Explain 'property flipping'.

Property flipping refers to the practice where an investor purchases a property, typically an undervalued or distressed one, makes improvements or renovations, and then sells it shortly after for a higher price, aiming to generate a profit from the transaction. This strategy often relies on the investor's ability to identify properties with potential, estimate renovation costs accurately, and navigate the real estate market effectively.

Successful property flipping requires not only a keen understanding of real estate trends but also knowledge about home improvements that maximize value, budget management, and sometimes the ability to manage properties during the renovation phase. Investors usually aim to complete these transactions within a relatively short time frame to capitalize on favorable market conditions and minimize holding costs such as mortgage payments, property taxes, and utilities associated with the property.

In contrast, the other choices do not align with the concept of property flipping. For instance, long-term rentals involve holding property for an extended period to generate stable income, while auctioning properties revolves around selling them through bidding rather than direct sales after renovations. Refinancing involves restructuring the existing mortgage rather than selling the property.