House Flipping Volumes
ATTOM reports that so far “153,727 single family homes and condos” have been flipped in 2017. That is almost identical to the high set in 2016. 48,685 of those were flipped in the third quarter alone. However, nationally ATTOM’s data shows the home flipping rate has dipped to just 5.1%.
Yet, in almost half of America’s major metros home flipping has been increasing. Some of the biggest surges were seen in Baton Rouge, LA (up 140%), Salem, OR (up 51%), and Indianapolis, IN (up 51%). Cities where home flipping declined included; Los Angeles, Miami, Washington DC, Boston, and San Francisco.
Home Flipping Returns
While home flipping returns declined to just 47.7% in the third quarter, the average gross profit remained a strong $66,448, thanks to higher home prices.
On a percentage basis, the best performing markets in Q3 for ROI included:
- Pittsburgh (147.7%)
- Baton Rouge (122.2%)
- Philadelphia (114%)
- Baltimore (101.5%)
- Cleveland (98.6%)
Hard and private money lenders are excited to put their money to work in these areas.
Metros with the lowest ROI included:
- Austin (18.7%)
- Reno (22.3%)
- Dallas (22.7%)
- Kansas City (24%)
- Salt Lake City (24.9%)
On a local note, Las Vegas-area flippers booked average gross profits of $59,503, giving them a 36.5 percent return on investment, in the three months ending Sept. 30. That’s compared with gross profits of $46,516, and a 30.4 percent return, in the same period last year.
Even the weakest performing housing markets appear to be delivering strong double digit returns for house flippers. There is big money to be made in flipping US real estate. Yet, it is also worth noting that where the best profits are continue to shift. ATTOM also reports that the number of flips the average investors are doing has fallen to its lowest rate since 2008, at just 1.251 per investor. That may reflect seasonal changes, but also the number of new investors which are getting into the business, and levels of competition.