Flipping is the process of buying a distressed property, whether residential or commercial, then renovating it cheaply and selling it to a waiting buyer. During the last crazy days of the real estate boom that lasted through the early 2000s, many people were jumping into the flipping market with whatever money they could get their hands on — funds from a home-equity line of credit, interest-only loans, borrowings from friends and family, you name it.

When the real estate market was hot, and lenders were happy to cough up money to borrowers with good credit — but not a particularly hefty amount of experience in real estate investing or renovation — flipping was a relatively easy and often lucrative game. But as the market began to slow by 2005, properties were sitting on the market longer because the market of people willing to buy the flips were starting to evaporate. Suddenly, these smart new real estate investors started to look like mopes.

In truth, good opportunities for real estate investing actually don't stop. There are opportunities in good markets and bad. But the overheated market that produced the flipping frenzy quickly separated the pros from the amateurs.