History

• In the early 2000s a housing boom hit the United States, as contractors were busy constructing and renovating. The bubble collapsed around 2005, two years after the Department of Housing and Urban Development created the anti-flipping rule.
  
  

The Rule

• The anti-flipping rule, published in the Federal Register, aimed to prevent the practice of flipping on properties being financed with a mortgage insured by the Federal Housing Administration.
  
  

Misconceptions

• According to the House Flipping Online website, the anti-flipping rule did not prohibit or regulate property flipping on mortgages not insured by the FHA. Those transactions remained legal as long as the seller stayed away from loan fraud or any practice deemed illegal by federal law.
  
  

Revisions

• In early 2010, the FHA revised the anti-flipping law to waive the long-standing 90-day window between buying and selling a home. Its goal was to help local communities burdened with too many bank-owned and foreclosed homes, with hope to revisit the issue again in one calendar year.
  
  

Expert Insight

• According to Bankrate.com, the anti-flipping law impeded the resale of homes, unfairly affecting small entrepreneurs and giving homeowners who needed to exit their homes quickly a much smaller pool of potential buyers.