A report from Curbed Los Angeles in California. "CoreLogic analyst Anrew LePage suggests the slower rate of price growth may have a lot to do with the fact that home values are entering uncharted territory. Many buyers, says LePage, may be waiting for a drop in prices before purchasing; others may simply be priced out of the market. If would-be home shoppers are choosing not to buy, that could explain underwhelming sale numbers in the last year. Across all of Southern California, home sales have dipped on a yearly basis in each of the last 10 months."

"LePage says such a lull is to be expected: 'Sixteen years ago, a few years before the last cycle’s peak, the market might have experienced a similar slowdown had it not been for the widespread availability of very risky home financing that let buyers stretch to their financial max.'"

From Forbes. "In the real estate game, there's no shortage of wannabe Warren Buffetts and Sam Zells who get their start flipping houses for a quick return on investment. According to Attom Data Solutions, 7.2 % of all U.S. home sales during Q1 2019 were flipped homes, the highest rate in nearly a decade. But it's a cottage industry ripe for mortgage fraud that only gets exposed when an investment goes south, legal experts say."

"Miami real estate attorney Josh Migdal said rising housing prices is making it harder for average Americans to buy homes and properties are staying on the market longer than anticipated. In some cases, home flippers can't make mortgage payments and banks initiate the foreclosure process, which is when instances of fraud come to light, Migdal adds."

"'Home flippers are in a tough spot,' Migdal said. 'Their strategy of buying a house, putting some work into it and then quickly selling it for a return only works when there is an an appropriate supply and demand level.'"

"In South Florida, an oversupply of homes for sale has priced out most buyers out of the market, Migdal said. 'We are left with home flippers stuck with their inventory,' Migdal said. 'The mortgage fraud comes into play when some of these individuals don't tell banks that they are actually home flippers.'"

"Migdal said some home flippers represent themselves as the typical home buyer and falsely claim they intend to live in the property. 'This is called occupancy misrepresentation,' Migdal said. 'These are impossible for a bank to detect until the home flipper winds up in foreclosure. I expect fraud will bubble to the surface between now and 2020 as the housing market declines and home flippers begin to flop.'"

"Paul Levin, a California-based lawyer specializing in mortgage fraud cases, said it could take years for banks to uncover mortgage fraud by home flippers. In some cases, home flippers use straw buyers to purchase the property and obtain a bank loan, Levin said. 'If you make a loan on day one and then it defaults six months later, there is a long procedure that winds itself through the courts,' Levin said. 'It is only in the latter stages of the process, that the fraud is detected.'"

"Levin's job is to pursue legal remedies against other parties involved in a fraudulent home sale involving flippers. 'It could be closing agents and other loan originators that broker and sell loans to securitized pools or larger institutions,' Levin said. 'It could also be sellers and developers that pay kickbacks to buyers.'"

"During the last housing boom before the 2008 real estate crash, Florida home flippers committing fraud were buying condominiums. Today, they are buying single family homes, Levin said. 'Home flipping fraud is always a constant,' he said. 'But lenders don't go after the bad actors. They have a business model that accepts some losses.'"

The Jersey Journal in New Jersey. "A Jersey City man has been indicted on more federal charges accusing him of running a $30 million mortgage fraud scheme involving properties in Jersey City and elsewhere in New Jersey, U.S. Attorney Craig Carpenito announced Wednesday. On Tuesday, Anthony Garvin, 49, of Jersey City, was charged in a superseding indictment with one count of bank fraud conspiracy and five counts of bank fraud. He was indicted on one count of bank fraud conspiracy and one count of bank fraud on Jan. 11, 2019, Carpenito said."

"Garvin was initially indicted only on the the conspiracy charge on Nov. 17, 2017. He was arrested along with Christopher Goodson of Newark. Garvin and co-conspirators allegedly used fraudulent documents to purchase properties in mortgage default and then used more fraudulent documents to secure multiple loans for the resale of individual properties to 'straw buyers' and then pocketed the money that was provided by financial institutions, officials said."

"From January 2011 through November 2017, Garvin and others engineered fraudulent short sale 'flips' of various New Jersey properties and also fraudulently obtained numerous home equity lines of credit, or 'HELOC' loans, using fraudulent documents and information, according to court documents."

"The conspirators allegedly arranged simultaneous fraudulent transactions for individual properties. In the first transaction, which involved the sale by the current owner, the conspirators convinced the financial institution holding the mortgage to accept the sale of the property at a loss, usually to a buyer who was secretly a conspirator or an entity controlled by the conspiracy, according to court documents."

"In the second transaction, the conspirators flipped the same target property from the first buyer to a second buyer, who typically obtained a mortgage from another financial institution using false loan applications, pay stubs, bank account statements and title reports provided by members of the conspiracy. The resale frequently closed for as high as double the price of the purchase, according to court documents."

"Garvin and others allegedly rigged the short sale process at each step to maximize profits and keep the victim financial institutions in the dark. The conspirators used various phony documents and misrepresentations, including generating false pre-approval letters from a New Jersey corporation controlled by a conspirator and generating phony, backdated deeds, according to court documents."

"To obtain HELOC loans, the conspirators allegedly submitted loan applications in the name of straw borrowers, who did not reside at the properties, and used fraudulent information – including false pay stubs and tax information – to make it appear the straw borrowers made more money than they really did. Conspirators often applied for multiple HELOC loans on the same property nearly contemporaneously, withholding from each lender the existence of other applications, according to court documents."

"Conspirators then disbursed the funds received from financial institutions — which totaled millions of dollars — into various accounts they controlled to and split the profits."