Flip This House, If You Can

Getting financed can be an issue, of course, since loan qualifications have tightened considerably in the last couple of years. When you're talking about investment properties, lenders want to see squeaky-clean credit reports, low debt-to-income ratios and sizable chunk of cash for a down payment.

"Some people who in the past may have done this separately are coming together and forming investment groups to purchase properties outright or to finance them," says Napoleon. "This way, risk is spread out."

In that mode, look for properties in neighborhoods that don't have many rentals; that keeps your competition down if you have to hold the property for a while.

"That's one of the little things you need to look for that the investor of a few years ago may not have paid attention to. He or she just figured that they'd sell in 90 days," says Molony.

And finally, why are those house-flipping shows still so popular?

"My wife loves them," says Molony. "But she watches them for the same reason lots of other people do. Not to learn how to make money, but to see how to economically fix up the house you have."

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