Though exact numbers are hard to find, one indicator that shows how active the trend of flipping may be is the homeowner vacancy rate.

The U.S. Census Bureau shows that the number of empty households in Cochise County rose from 2.9 percent in 2000 to a two-year average of 3 percent from 2006 to 2008.

According to Robert Carreira, director of the Center for Economic Research at Cochise College, this might indicate that investors are buying houses and leaving them unoccupied while they fix them up, and prepare to sell or rent (flip) the properties.

According to Carreira, the large number of houses being sold by investors who could no longer pay to fix them up increased the supply of overall houses in the wake of the housing bubble bursting. That in turn decreased the prices of these properties, which only worsened the real estate market.

Any investor looking to flip or rent out a house now can do so, but only if he or she is willing to hold on to their properties for a longer period of time than they would have had to endure in the boom period of house flipping – between 2003 and 2007.

"Those engaging in the [house flipping] practice will need to wait until foreclosures are cleared out and values are restored in order to profit, and that may take several years," Carreira said.

This is the exact situation Tina Miller, owner of Tombstone Mercantile and homes at 111, 113, 117 and 119 North Ninth Street has encountered in the last few years.

"I was going to sell [the renovated houses] a couple years ago," Miller said. "But the market crashed, and that's when I decided not to sell."

Purely as a business decision, Miller has decided to hold on to her properties, keep them as assets and rent them out to locals to receive a steady monthly income.

"I make a profit every year—it's a good return on your money," said Miller. "You can generally make a seven to ten percent return on your money."

A house which costs, for example, $100,000, could mean a yearly income of $10,000 depending on the rate of return.

Returns on investments rely heavily on how much money is put down initially and on how much mortgage is owed on the property. The lower the mortgage, the higher the monthly return on an investment will be.

Miller said she doesn't plan on selling any of her houses at least for another two years, but also said that if the market is good at that time she might sell her properties and live on that money. Otherwise, she will continue collecting her monthly rent.

Miller warns that renovating a property is not the most economic way of purchasing a house, and in many cases, it makes sense to buy a new property.
She advises all prospective home renovators to thoroughly inspect a prospective investment in property and pay particular attention to the structure—both the foundation and roof.

"You have to remember, when you're fixing up a place, you have to tear it down and rebuild it," she said.

"There are always mysteries that you catch—it's a puzzle," she said. "There are always electrical or plumbing surprises."

Despite the hardships, Miller renovates properties because she enjoys preserving the history of the houses and old buildings.

A competing philosophy in real estate is to resell properties after minimal restorative work has been done.

"It's not so much to completely remodel but some investors pick up a property at an auction or trustee sale for cash at a discount price and then they clean it up, do minimal repair work and can sell it to a buyer using owner or conventional financing," said Barbara Highfield, owner and designated broker for Tombstone Real Estate.

Highfield believes this process provides reasonably affordable housing for the public and cleans up the community by fixing up properties that needed attention while providing a profit to the owner.

Highfield's brokerage firm just put a property up for sale at $49,000.

"The place is a dump—junk everywhere inside and mostly out," she said.
"It is now bank owned and...we are getting it cleaned out, but an investor will likely pick it up for somewhere in the $40 [thousands], spend $10k to fix it up minimally and sell it in the $60 [thousands]."