Nearly 60,000 U.S. single-family homes and condos were flipped in the second quarter of 2019, up 12.4 percent from the previous quarter, but down 5.2 percent from a year ago, according to ATTOM Data Solutions Q2 2019 U.S. Home Flipping Report.
ATTOM said the homes flipped in the second quarter represented 5.9 percent of all home sales during the quarter, down from a post-recession high of 7.2 percent in the previous quarter, but up from 5.4 percent a year ago.
“Home flipping keeps getting less and less profitable, which is another marker that the post-recession housing boom is softening or may be coming to an end,” ATTOM Chief Product Officer Todd Teta said in a release. “Flipping houses is still a good business to be in, and profits are healthy in most parts of the country.
“But push-and-pull forces in the housing market appear to be working less and less in investors’ favor,” Teta added. “That’s leading to declining profits and a business that is nowhere near as good as it was a few years ago.”
According to the report, homes flipped in the second quarter typically generated a gross profit of $62,700, up 2 percent from the previous quarter, but down 2 percent from a year ago. The typical gross flipping profit of $62,700 in the second quarter translated into a 39.9 percent return on investment (ROI), down from a 40.9 percent gross flipping ROI in the previous quarter and from a margin of 44.4 percent one year ago.
Seventy-percent of metropolitan areas posted a year-over-year increases in flipping rates in the second quarter, including Raleigh, N.C. (up 72 percent); Charlotte, N.C. (up 54 percent); Atlanta (up 46 percent); San Antonio (up 46 percent) and Tucson, Ariz. (up 43 percent).
ATTOM said the number of homes flipped reached new peaks in the second quarter in 10 metropolitan areas, including in Charlotte, N.C.; San Antonio; Pittsburgh; Oklahoma City; and Raleigh, N.C.
Homes flipped in the second quarter took an average of 184 days to complete the flip, up from an average of 180 days for homes flipped during the previous quarter and up from an average of 183 days a year ago.