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Desert Companion

Into the Gray with the Vegas Flippers


Illustration by Delphine Lee

TR WitcherEditor’s note: In this six-column series, writer T.R. Witcher explores the issues around housing in Southern Nevada. This is the fifth installment. Read his other essays at



Your feelings about home flippers — the folks who snap up homes, make a bunch of largely cosmetic fixes, then sell them fast for a nice profit — may have less to do with the work they do and more with your own level of admiration for the swagger of entrepreneurs who see an opportunity to make a buck, take the risk, and, if lucky, reap the rewards. For some, flippers are vaguely distasteful, schemers perfuming rundown homes just enough to lure in an unsuspecting buyer. For others — certainly for the flippers themselves — they are unsung heroes transforming dilapidated ’hoods into desirable communities, one house at a time.

Jay Mirando always wanted to get into real estate. He worked as a dealer in Connecticut, and when the market crashed, he figured the place to be was Las Vegas, Phoenix, or Miami. You could buy a property and clean up. So he came here. It took him almost a year to find work as a dealer, but once he did, he bought an investment  condo for $74,000. He rented it out. Then he sold it for $160,000. It was, he says, “a good day at the office.”

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Mirando began flipping homes and eventually got his real estate license. Now he does 8-12 a year. It’s not rocket science, he says. “Buy something for less than what it’s worth, put some money into it, sell it for more than what it’s worth.”

“Three years ago, flippers were huge, we were appreciating so rapidly,” says Janet Carpenter, president of the Greater Las Vegas Association of Realtors. “They could come in, put in a few repairs, and turn around and put money in their pocket.” That was when housing values were rising north of 7 percent each year. Now we’ve slowed to 3-5 percent. “The profit margin’s not there.”

Most agree the stabilizing market is good for you and me — there’s less risk of entering an unsustainable boom. For flippers, though, it means there’s less margin for error. A couple years ago, there were all sorts of homes available through foreclosures and short sales. Homes at auction. Homes at probate court. “If you went to the courthouse, there’d be 30 houses,” Mirando says. “Now there are three or four.” And 20 investors bidding on them.

Flippers fall along a spectrum. At one end are your amateurs, the weekend warriors who take on a job or two a year, who perhaps live in their homes and spend months lovingly restoring them. At the other are a handful of “volume” flippers, the pros of the game who do at least half of the roughly 2,500 homes flipped in Las Vegas a year.

One of those pros is Josh Galindo, owner of the Galindo Real Estate Group. Galindo flipped his first home in 2008. Since then he has flipped between 650 and 750 homes. He says the changing market hasn’t much affected his work. “Flipping is a business of chance. And it’s controlled chance.” He’s used the same formula for buying homes since he began — he seeks an 8-10 percent margin per house, while allowing for a 10 percent margin of error on repair work.

The recent years of high-flying home valuation, he says, “created flippers who should have never been flippers. They didn’t have to buy the property properly. They could just buy it at any price. The formula for flipping is to buy a home below market value; when a market is increasing that means you don’t have to find as deep a discount” — because the home was increasing in value on its own. Now, not so much.

Or, as Mirando, who aspires to join the ranks of the volume flippers, puts it, “You can’t bet on appreciation.”



The textbook flip is easy enough: Find a house with deferred maintenance in a rough neighborhood. Figure out the all-important “after-repair value,” or ARV — the value of the house after you’ve fixed it up. Take 80 percent of the ARV. Subtract the costs of repairs. That’s what you should pay for the house. So if you find a house for $130,000 and put $30,000 in, you want to sell it for $200,000. A good rule of thumb for flips is 90 days, says Galindo: 30 days to renovate, 30 to market, 30 to close. After closing costs, you can make a tidy profit in a few months and move on to the next one.

Of course, there is no textbook flip. And while it all looks like a well-oiled machine for the top guys, there are risks. Flipped homes get broken into all the time. General contractors and work crews often nickel and dime you. And you usually have a good chunk of your own money on the line. Flippers often finance their deals with “hard money” loans — as in, hard to pay back — one year, high-interest, collateral-based loans, in which the only benefit for borrowers is that lenders don’t care who the borrower is. They’re great if you can renovate and sell a home in less than a year. If you can’t? Unless you have deep pockets, you’re screwed.

Some flippers find their houses the way the rest of do, on the Multiple Listing Service. But about half of home flips are found through wholesalers: individuals or firms who contact homeowners to see if anyone wants to make a deal. Maybe you’ve got a lot of deferred maintenance. Maybe you just need to get out of your house. If you’ve defaulted on your payments, expect to hear from the wholesalers (notice of default is public record). Or maybe they’ll just call you cold — we’re seeing more of that in Vegas as low-hanging fruit gets plucked.

The wholesalers need the homeowners to sell for less than the house is worth, and they’re willing to pressure homeowners: Your house is kind of falling apart, you won’t get any better than what I’m offering you now. Homeowners may think they’re selling to the wholesalers, but the wholesaler is just the middleman linking home to flipper.

Wholesalers are like Wolf of Wall Street types selling penny stocks back in the ’80s — ambitious and tenacious, sometimes unscrupulous. “These people prey on the elderly,” Galindo says. “They’ll watch the death records, so if the husband or wife dies, they’ll go and attack that house. They’ll prey on the uneducated. They’re dangerous.”

But if that’s true, such practices reflect poorly on flippers themselves, who may profit on homes that were obtained through shady, though still legal, means. “It’s kind of like the blood diamond thing,” Galindo admits. “‘I didn’t hire the labor in Africa to dig that out, all I did was buy it.’ But, ultimately, you’re part of the system. But the reality is, everybody is doing legal business.” He says he finds most of his inventory from MLS or on his own.



Flippers are viewed with skepticism because of the perception that they merely perfume the pig — slap a coat of paint on an aging house and put in new stainless steel appliances, all the while ignoring existing structural issues (especially in the vintage homes of the 1950s and 1960s) — so the buyer gets a nice-looking home that may have a bad roof or need a new sewer line.

The flippers contend that it’s hard to hide structurally deficient homes from anybody — and Mirando argues the dry desert conditions of Las Vegas preserve homes pretty well. (But if you’re buying a flip in Downtown, make sure your agent is experienced in dealing with older homes.)

The bigger issue with flippers is aesthetic. If you peruse the listings on Redfin or Zillow, you can easily spot the flipped homes. They’re gray. The walls are gray. The faux wood floors are gray. The carpet is gray. The fixtures are white or black. The kitchen cabinets are white Shaker. There is invariably no landscaping in the backyard.

Gray is easy. It’s neutral. It’s cheap. And the resulting flipped home feels much the same, equal parts polished and phony. It feels like you’re getting a great deal on a sweet custom crib in some up-and-coming neighborhood. But there’s more choice at your KB Homes design studio.

Realtor Steve “Downtown Steve” Franklin recently threw a little shade at the flipping industry on Facebook: As the real estate market has cooled a bit, it’s nice to see flipper homes ... with their bland sameness flips ... sitting on the market longer. I am seeing their places lingering for months ... even after multiple open houses and price reductions. I like to see them get stung ever so slightly with their soul sucking flips. Y’all can leave, I think we have enough granite countertops, laminate floors, and useless gravel back yards now.

When I asked him to elaborate, he credits flippers with saving vacant houses after the crash, houses that were being destroyed by squatters. But he contends flippers working Downtown should restore homes, inside and out, preserving their vintage details, and not rehab homes, where you wipe the slate clean. “You’re entering a market in Las Vegas that is unique,” he says. “Take that into consideration, and maybe change your formula to mirror what people are coming down here for.”

I asked Galindo and Mirando about all the gray. Galindo puts it this way: “What the consumers have to realize, a flipper’s job isn’t to deliver an HGTV product that has these incredible designer finishes. At its core, the flipper’s job is to deliver a clean, updated, move-in ready home.” So you go with whatever inoffensive style is on trend.

Still, he prides himself on tailoring his interiors to the markets — muted mochas and cappuccinos for seniors in Sun City Summerlin, something livelier for first-time homebuyers in Spring Valley. He wants to make sure the next buyer will get five years of use out of it.

As for Mirando, he says he’s changing his gray ways after he realized one of his clients didn’t much care for the color. She liked homes with more personality. Gray is a solid palette, but it has no soul. “It doesn’t feel like a home,” he says. “It feels like a hotel room.” He’s looking to warm up his color palette.



Between the flippers and the large home or apartment developers, there may be space for smaller, “micro” homebuilders to flourish. Ed and Shelly-Ann Weigert moved to Vegas five years ago from New York. They had done some home flips back East, and they tried a few here, as well. “I know both sides, the architecture and the building side,” Ed says. “Why don’t I do this from scratch?”

Ed went to work for luxury contemporary home developer Blue Heron; Shelly-Ann is a nurse. They flipped some homes in their spare time. Ed handled the construction, Shelly-Ann the interior design.

But they were more interested in really getting into the bones of the homes they were fixing up. “A lot of these flippers, they hide something behind the wall. We can’t cover something up,” Ed says. “Houses in worse shape are easier — it’s better for us, because it’s all coming out.”

“If it smells like mold and cats, we’ll take it,” Shelly-Ann adds.

A few years ago, while working on a place in the Huntridge neighborhood, they realized that it might be better to tear down a distressed home and build something new. There is no shortage of clunker homes in Downtown. They bought an old house on Yucca, knocked down everything save the concrete foundation, then went to work. They designed a new, energy-efficient modern home — think of it as Blue Heron lite — and sold it for $325,000, for a profit of about $40,000 after closing costs.

That’s not a steal, but it is a house every bit as affordable and new, and more stylish, than homes on the edge of town. Maybe it is a steal.

What the Weigerts represent is a new vision for Downtown Las Vegas, where teardowns are not common: a more contemporary design language, more unique than flips, but not so large or outscaled that it feels like a McMansion. They are hoping to move full-time into new-home builds like this over the next couple of years and already have a name for their business: Halcyon Homes of NV. “Vegas gave us so much,” Shelly-Ann says. “I want to give back.”



The demand is there. For some it’s an affordable(ish) way to get into a solid(ish) home that they might not otherwise be able to swing. A generation of homebuyers weaned on HGTV wants to try living in a flipped home (if not trying to fix it up themselves). In Downtown, people can grab a flipped home because they’re drawn to the allure of urban living, Vegas style; the house’s bones may not be in the greatest shape, but the interior looks up to date. Maybe that’s enough. 

GLVAR president Carpenter puts it this way: The average homebuyer has no imagination. They can’t walk into a distressed home and see the possibilities. So the flipper does them a service. “They have to see it already done, and they fall in love.”

Mirando has no doubt the flippers are on the side of the angels every bit as much as they are the angles. He knows that there’s value when you take one house — a house so bad even the squatters won’t stay — and you fix that house, and then maybe that one house turns the block around, and that one block may turn a whole neighborhood.

I asked Carpenter if she was aware of a single home flip turning around a neighborhood. She responded emphatically: No. But Mirando and Galindo both contend flippers have helped improve neighborhoods from Maryland and Russell to Charleston Heights.

Speaking about the ’hood around Sandhill and Tropicana, Galindo says, “I would say the flipping industry of this city has singlehandedly revamped the entire area.” He goes on: “Every time we stamp our foot across the valley that’s one more home that’s going to stay filled with somebody who cares about it for 5-7 years, further stabilizing neighborhoods. We’re huge. We’re the carp in the lake, cleaning it up.”

I asked Mirando what makes him most satisfied. He likes the rush of a good deal. He likes helping out somebody who’s trying to get into a home. But, no lie, he really likes the money. He wants to get into that high-volume world of 40-50 a year. Then he wants to get into commercial — because you can do cooler stuff there. Like the Starbucks we’re sitting in near the Silverton off Blue Diamond. It looks like a high-end ski lodge in Aspen. Now those are some dope finishes inside.

Flipping homes is a way to keep upping his own game.

“I like leveling up in life.”

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