$10 billion in suspicious “flipping” deals in Florida alone during the housing boom. Are we up to the same tricks again?

Q: What is short-sale flipping?

A: Buying a distressed property from a bank just before foreclosure, then selling the property immediately. A short-sale is a lender’s sale of a property for less than the amount of the mortgage owed.

According to a study of 18,000 property sales by the Herald-Tribune, 250 properties were sold multiple times within the year, and 20% of those were resold within 24 hours after a short-sale was granted by the bank.

Approximately  half of the multiple sale flips so far this year were in Sarasota County. Half of that half were property flips (sold twice within a month) made by real estate agents, real estate attorneys, or mortgage brokers.

Banks lost $1.7 million in the 50 flips made within 24 hours of the short sales so far this year.  In other words, $1.7 million was made in profit by short sale flippers – just from shuffling paperwork and making a few phone calls. That works out to be on average, $34,000 in profit per property.

Those numbers are from Sarasota and Manatee counties in Florida. Just two counties in America – and 2009 isn’t over yet.

Is this the same behavior that got us in trouble in the first place? With the mortgage bank bailouts this year, did tax payer’s essentially pay the $1.7 million in short sale flip profits?