Both the number of homes flipped and average return on investment (ROI) on those transactions declined during the first quarter of 2017, according to ATTOM Data Solutions.
ATTOM’s Q1 2017 U.S. Home Flipping Report showed that 43,615 single family homes and condos were flipped — sold twice within a 12-month period — during the first quarter of 2017, down 8 percent compared with the previous quarter and down 6 percent from a year ago.
The number of homes flipped during the first quarter was the lowest number since the first quarter of 2015. However, the report found that the amount of home flipping loans hit a nine-year high.
“The business of financing for home flippers continued to grow in the first quarter of 2017 even as the home flipping rate plateaued compared to a year ago and average home flipping returns decreased for the second consecutive quarter,” ATTOM Data Solutions Senior Vice President Daren Blomquist said in a release.
“Home flippers financed an estimated $3.5 billion in purchases for homes flipped during the quarter, up from $3.3 billion in the previous quarter and up from $2.4 billion a year ago to the highest level since the fourth quarter of 2007.”
Home flips comprised 6.7 percent of all sales during the quarter, up from 5.8 percent in the previous quarter and unchanged from a year ago. Nearly 34 percent of the homes flipped during the quarter were purchased with financing, up from 31.9 percent in the previous quarter and up from 29.5 percent one year ago.