California flipping is back in a big way

A total of 6,000 homes have been flipped in the state over a 12-month period ended in April, according to PropertyRadar. That's the highest level since late 2005 when the housing market was reaching near-frenzied proportions. In case you're a little hazy, flipping is when a property is bought and sold within a six-month period. One of the problems with flippers is that they are willing to pay all cash, which means that potential bidders requiring a loan could get passed over. The flippers say that they're buying homes that often get bypassed. From the WSJ:

While flipping is re-emerging nationwide, brokers say it is happening most in California, where home prices have risen sharply over the past year. Six of the 10 largest price gains in major U.S. cities over the past year have been in California, according to Zillow. In April, home values rose by 25% from a year earlier in San Jose, San Francisco and Sacramento, and by 18% in Los Angeles. "When prices rise, this trade works. It's not anything more sophisticated than that," said Christopher Thornberg, an economist with Beacon Economics in Los Angeles. Prices are shooting up due to the short supply of homes for sale, which partly reflects the reluctance of homeowners to list homes at prices down sharply from their peak.

L.A.-area home prices jumped 16.6 percent in March compared with a year earlier, according to the Case-Shiller index, part of a 10.9 percent increase nationally that's the biggest gain in seven years.