The Breakdown | Explaining Southern California's economy
Business & Economy

SoCal home sales surge, but cash is king and "flipping" is back



A sold sign is posted on a fence in front of a newly constructed home in the Oakbridge housing development in Danville, California.
A sold sign is posted on a fence in front of a newly constructed home in the Oakbridge housing development in Danville, California.
David Paul Morris/Getty Images

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Southern California got clobbered during the housing downturn. But it’s still a great place to live, something that bargain-hunting investors have figured out. 

Case in point: February was the best year for home sales in Southern California in six years, reported real-estate analytics company DataQuick.

But even though the SoCal housing market is improving, it’s anything but normal.

So-called “absentee” buyers—investors and second-home shoppers—accounted for a record 31 percent of home sales in the region last month.

And all-cash buyers snapped up more than a third of all homes for sale.

“Flipping”—buying a home and then quickly reselling it—is also back in vogue. The number of homes sold and then resold in six months jumped from about 4 percent in February 2012 to 7 percent last month.

This is making it tough for everyday buyers to get in on the action, as they get priced out and housing inventories fall to new lows.

Follow Matthew DeBord and the DeBord Report on Twitter. And ask Matt questions at Quora.