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5 Best Cities for Flipping Homes Right Now

BOSTON ( TheStreet) -- The rebounding U.S. real-estate market is leading to a renaissance in "home flipping" -- the investment strategy in which you buy distressed houses, make minor upgrades and resell the properties a few months later for quick gains.

"Right now is an ideal time for flipping, because we're seeing home prices bounce off of the bottom," says Daren Blomquist of RealtyTrac.com, which recently named the 25 Top U.S. Markets for Flipping Homes -- including some that offer more than 50% gross returns.

Made popular by reality-TV shows such as Flip This House>, home flipping looked easy during the housing boom when prices kept rising. The strategy became decidedly harder during the real estate bust that followed.

Now, flipping is enjoying a comeback because home prices have bottomed out in many U.S. locales and begun to rebound.

Blomquist says today's best markets for flippers soared during the boom and collapsed during the bust. Many are also in the so-called "Sand States" of Arizona, Florida and Nevada, which suffered through some of the nation's highest foreclosure rates in recent years.

"These markets all crashed pretty hard, so they've got lots of available distressed properties," Blomquist says. "But they're also perpetually popular with consumers because they're located in the warmer climates that many people want to move to."

Here's a look at the five metro areas RealtyTrac believes offer today's best opportunities for home flips (defined as buying and selling the same property within six months).

The site ranked each city based on how much gross profit local home flippers enjoyed in percentage terms on the average 2012 single-family sale, excluding renovations and other expenses beyond what investors initially paid for properties. All cities also had at least 500 home flips during 2012, as well as 9% or higher average annual home-price appreciation during 2013's first quarter.

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