Property data curator ATTOM released its third-quarter 2024 U.S. Home Flipping Report, showing 74,618 single-family homes and condominiums nationwide were flipped in the third quarter.
Those transactions represented 7.2 percent, or one of every 14 home sales, nationwide during the months running from July through September of 2024.
The latest portion of flipped properties was down from 7.6 percent of all sales during the second quarter of 2024, extending a common pattern seen during annual spring and summer buying seasons when other types of home sales spike. The flipping rate returned to the 7.2 percent level recorded in the third quarter of last year.
However, while the flipping rate followed historical trends, profits turned downward for investors who buy, renovate and quickly resell homes following a period when their fortunes had been improving.
“Home flippers just can’t seem to shake the doldrums. After more than a year when things were getting better, they turned notably worse again over the summer,” ATTOM CEO Rob Barber said in a release. “One quarter’s worth of numbers isn’t enough to make any grand statements about another downturn. The next six months should speak more to that, especially amid an ongoing tight housing market that should work in their favor. But as interest rates remain double what they were a few years ago and inflation keeps raising renovation costs, investors continue to have a tough time making the kind of profits that would lure more into the game.”
Latest data showed home flipping nationwide generated just a 28.7 percent return on investment before expenses on homes re-sold during the third quarter of this year. That was down from 31.2 percent in the second quarter of 2024 after six straight quarterly increases that had signaled a marked improvement for the flipping industry.
The typical profit margin on homes flipped during the third quarter of 2024 – based on the difference between the median purchase and median resale price for home flips – slid down to only half of the mid-50 percent peak hit in 2016. It also stayed within a range that could easily be wiped out by carrying costs that include renovation expenses, mortgage payments and property taxes, exposing again the struggles U.S. home flippers are having in turning healthy profits.
Gross profits on typical flips around the country, meanwhile, decreased to about $70,000. That was down roughly $5,000 from the prior quarter and $10,000 from highs reached two years ago, although still up slightly from the third quarter of 2023, according to ATTOM.