FHA has extended the Property Flipping Waiver through December 31, 2012. All terms of the existing Waiver will remain the same. The Waiver continues to be limited to sales meeting the following conditions:

 •          All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction.

•          In cases in which the sales price of the property is 20 percent or more above the seller’s acquisition cost, the Waiver will only apply if the lender meets specific conditions and documents the justification for the increase in value.

This is great news.  The exception is if the first sale is a short sale where the seller qualifies for the HAFA program.  Then the flipper/investor has to hold onto the property for 90 days.