"Flipping rate spikes to 9-year high, while average ROI (return on investment) falls to 8-year low"
It seems Americans have finally shed their post-recession fears and gotten back into the house flipping game.
The latest report from ATTOM Data Solutions reveals that the house-flipping rate spiked to a nine-year high in the first quarter of the year, with 7.2% of all home sales representing a flip – up from the previous quarter's 5.9%.
But it appears flippers are making less – way less – than they used to.
ATTOM’s report revealed that the average return on investment calculated by the cost of acquisition versus the cost of sale was 38.7% in Q1 – the lowest level in nearly eight years. This is down nearly 10 percentage points from one year ago.
Of course, there are always those who buck the trend.
In 11 markets, investors actually doubled their ROI on house flips. The standouts with the highest ROIs were Pittsburgh, Pennsylvania; Flint, Michigan; Shreveport, Louisiana; Scranton, Pennsylvania; and Knoxville, Tennessee.
The average flip sold for a median price of $215,000, ATTOM revealed, and the average gross flipping profit in Q1 was $60,000. The average timeframe to complete a flip was 180 days.
“With interest rates dropping and home price increases starting to ease, investors may be getting out while the getting is good, before the market softens further,” said Todd Teta, ATTOM’s chief product officer.
“While the home flipping rate is increasing, gross profits and ROI are starting to weaken and the number of investors that are flipping is down 11% from last year,” Teta continued. “Therefore, if investors are seeing profit margins drop, they may be acting now and selling before price increases drop even more.”
To view original article, visit Housingwire.
Most Home Sales Close – Here’s How To Keep Yours on Track
Some reasons are outside a seller’s control, like whether a buyer’s loan clears or whether they sell their own home in time. But there are a few proactive things you can do to help make sure your sale goes as smoothly as possible.
Selling a Luxury House? Here’s Why Now Is a Good Time
High-end buyers tend to feel less of the affordability pressure weighing on many households today, so they keep buying even when the wider market slows.
More Homes, Better Prices: A Buyer’s Summer
Sellers are reading market conditions and are pricing accordingly from the start rather than listing high and cutting later, and buyers are taking note and making bids.
The “Take It or Leave It” Attitude Is Fading from the Market – What That Means for You
That’s why whether you’re buying or selling today, there are two terms you’ll hear a lot: concession and incentive.
What Buying or Selling a Home Gives Back to Your Community
Want to know what a move would mean where you live? A local agent can show you the figure close to home.
The 1 Factor That Explains Everything Happening with Home Prices Right Now
The national average of 1.7% price growth is accurate, but it’s an average of two very different stories happening at the same time – the few areas experiencing mild declines and the overwhelming majority that are still seeing prices rise.