LAKE WORTH, Fla. -- Where there are weeds, Adam Raizin sees palm trees, bamboo and a glistening lap pool. Where there is mossy green carpet and white walls, he sees gleaming pine floors and a southwestern color scheme.
The decades-old, rusted blue sink in the garage? He pictures a cabana, complete with a wet bar and period bathroom.
Adam Raizin turns around up to a dozen homes annually in Lake Worth, Fla., and makes $30,000 to $60,000 on each, often splitting the profit with an investor.
(J. Pat Carter -- AP)
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Most importantly, on this piece of land with a Spanish-style home near a quaint town center, Raizin sees dollar signs, lots of them.
"I almost lost this house because I blinked. You can't blink, you can't get distracted," he said. "I always say, 'I can buy a house faster than people can pack a toothbrush,' and that's the only way you can do it when you see a deal."
Raizin finds heaps of deals, usually checking out a hundred or more potential buys a week before snatching the perfect fixer-upper that he can flip for an easy sale and a tidy profit.
A little paint, a new front door and windows, some landscaping and cosmetic touchups can bring him as much as $50,000 in six weeks.
"You always have to know that there are no guarantees and it might all fall apart. But you have to take the risk," Raizin said.
The risks, however, appear minimal in a sizzling real estate market with skyrocketing property values and waiting lists of eager buyers. The seemingly simple profits are luring everyone from savvy investors to charity groups, even as experts caution that rising interest rates could signal the end of the home "flipping" phenomenon.
"We made more money than we ever made doing pancake breakfasts and Christmas tree sales," said Mary Lynn Desjarlais, past president of the Kiwanis Club of South Sarasota, which started flipping homes about 10 years ago to raise money.
The club and its 40 members bought their first fixer-upper when prices were within easy reach -- less than $50,000 for a home with three bedrooms and two baths. The first few homes they flipped brought in about $10,000 each, but their profits soon doubled and tripled as property values spiraled upward.
When homes became too pricey, the Kiwanis turned their money toward mom-and-pop motels that could be converted into condominiums. Their latest project, Bow Point, could reap a 100 percent return on a $600,000 investment.
The money has allowed the charity to build new facilities for an organization that helps children and adults with disabilities, restart a Dial-a-Book library program for children and assist the health department in tracking kids' immunizations.
"We're in the nice position of asking, 'Where do we want to put our money? Who do we want to help?' " said Desjarlais, who is also a real estate attorney. "But the club is being cautious. They're not putting all their money in it."
Although Desjarlais believes a continued flood of baby boomers moving to Florida will keep home prices here on the rise, experts caution that a real estate bubble could turn the big gains from "flipping" into heavy losses. Some say a dramatic increase in investors trying to turn around homes over the past year shows the market has become overheated.
