ENTREPRENEURSHIP

Home Flipping Dipped Last Quarter Despite Jump In Profits

It’s too soon to say whether the drop in flipper activity — which was still the second highest in two decades — is a sign of a broader slowdown.

With the industry and the market changing faster than ever, make plans to come together with the best community in real estate at our flagship event. Join us at Inman Connect New York, Jan. 24-26, and punch your ticket to the future. Check out these just announced speakers for this must-attend event. Register here.

The percent of homes sold that were flipped slowed alongside an overall cooling real estate market during the second quarter, but remained at the second-highest level in more than two decades, according to a new report.

While 1 in every 10 homes sold in the first three months of the year was flipped, the rate fell to 1 in every 12 sold in the second quarter, according to property information database Attom. 

It remains to be seen whether the dip was a temporary move off an all-time high in the first quarter or if the fix-and-flip market will face the same broader slowdown as the nation faces uncertainty over home values, inflation and the cost of financing.

“The big question is whether the fix-and-flip market will begin to lose steam as overall home sales have declined dramatically over the past few months, and the cost of financing has virtually doubled over the past year,” said Rick Sharga, executive vice president of market intelligence for Attom.

Between April and July, 115,198 homes were flipped, which represents about 8.2 percent of all home sales during that time.

The median sales price of a flipped home reached its highest ever point: $328,000, up 21.5 percent from a year before.

Gross profits were $73,700, up 10 percent from the first quarter and the same time last year. That was a 29 percent return on investment compared to the purchase price, according to the report.

Markets with largest flipping rates 

  • Tucson, Arizona (14.5 percent)
  • Phoenix, Arizona (14.1 percent)
  • Jacksonville, Florida (13.8 percent)
  • Atlanta, Georgia (13.6 percent)
  • Gainesville, Florida (13.5 percent)

“Fix-and-flip activity is mirroring overall housing market trends, with much of the activity, and the highest returns largely coming from the West and Southeast,” Sharga said. “In fact, even though the highest gross profits came from the most expensive states, 14 of the 18 states where flips accounted for a higher percentage of overall home sales than the national average were in the South, Southeast, and Western states.”

Email Taylor Anderson

Get Inman’s Property Portfolio Newsletter delivered right to your inbox. A weekly roundup of news that real estate investors need to stay on top, delivered every Tuesday. Click here to subscribe.

window.fbAsyncInit = function () {
FB.init({
appId: ‘267158050139450’,
cookie: true, // enable cookies to allow the server to access
// the session
xfbml: true, // parse social plugins on this page
version: ‘v2.9’
});
};
// Load the SDK asynchronously
(function (d, s, id) {
var js, fjs = d.getElementsByTagName(s)[0];
if (d.getElementById(id))
return;
js = d.createElement(s);
js.id = id;
js.src=”https://connect.facebook.net/en_US/sdk.js”;
fjs.parentNode.insertBefore(js, fjs);
}(document, ‘script’, ‘facebook-jssdk’));
//load analytics.js
!function () {
var analytics = window.analytics = window.analytics || [];
if (!analytics.initialize)
if (analytics.invoked)
window.console && console.error && console.error(‘Segment snippet included twice.’);
else {
analytics.invoked = !0;
analytics.methods = [‘trackSubmit’, ‘trackClick’, ‘trackLink’, ‘trackForm’, ‘pageview’, ‘identify’, ‘group’, ‘track’, ‘ready’, ‘alias’, ‘page’, ‘once’, ‘off’, ‘on’, ‘timeout’];
analytics.factory = function (t) {
return function () {
var e = Array.prototype.slice.call(arguments);
e.unshift(t);
analytics.push(e);
return analytics
}
};
for (var t = 0;
t < analytics.methods.length;
t++) {
var e = analytics.methods[t];
analytics[e] = analytics.factory(e)
}
analytics.load = function (t) {
var e = document.createElement("script");
e.type = "text/javascript";
e.async = !0;
e.src = ("https:" === document.location.protocol ? "https://" : "http://") + "cdn.segment.com/analytics.js/v1/" + t + "/analytics.min.js";
var n = document.getElementsByTagName("script")[0];
n.parentNode.insertBefore(e, n)
};
analytics.SNIPPET_VERSION = "3.0.1";
analytics.load("qGZ5B2F63B1nZc50lU1XNNA9LOEVxt61");
}

}
();
analytics.ready(function () {
ga('require', 'linker');
ga('linker:autoLink', ['events.inman.com']);
});
(function(d, s, id) {
var js, fjs = d.getElementsByTagName(s)[0];
if (d.getElementById(id)) return;
js = d.createElement(s); js.id = id;
js.src = “//connect.facebook.net/en_US/sdk.js#xfbml=1&appId=1488799148013723&version=v2.3”;
fjs.parentNode.insertBefore(js, fjs);
}(document, ‘script’, ‘facebook-jssdk’));



Source link

Show More

Leave a Reply

Your email address will not be published.

Back to top button