Home Flipping Hits 14-Year High

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While the real estate market in general is adapting to new challenges and market conditions, one segment of the market is going strong. Home flipping is boasting its best numbers in 14 years.

The newly released first-quarter 2020 U.S. Home Flipping Report from ATTOM Data Solutions shows that “53,705 single-family homes and condominiums in the United States were flipped in the first quarter. That number represented 7.5 percent of all home sales in the nation during the quarter, up from 6.3 percent in the fourth quarter of 2019 and from 7.3 percent in the first quarter of last year.” Those are the highest numbers since the second quarter of 2006.

The gross profit for home flips across the country also rose over the same time period, to $62,300. “That was up slightly from $62,000 in the fourth quarter of 2019 and from $60,675 in the first quarter of last year,” the report said.

If you’re looking to get in on the flipping trend, here are a few insights:

• You don’t need to buy a million-dollar fixer. “Homes flipped in the first quarter of 2020 were sold for a median price of $232,000.”
• Profits will be larger where the home prices are higher. “The highest first-quarter 2020 profits, measured in dollars, were concentrated in the West and Northeast. Among metro areas with enough data to analyze, 13 of the top 15 were in the those regions, led by San Francisco, CA (gross profit of $171,000); San Jose, CA ($165,000); Los Angeles, CA ($145,000); New York, NY ($141,899) and Honolulu, HI ($140,190).”
• The lowest profits were generally in southern metro areas, such as “Springfield, MO ($20,203); Daphne, AL ($20,650); Raleigh, NC ($21,250) and Durham, NC ($25,000).”
• Don’t think you have to turn the home around and sell it in 30 days. “The average time to flip nationwide is 174 days.”
• You don’t need to pay cash upfront for the home, as the percentage of flipped homes purchased with financing in the first quarter of 2020 was 40.5 percent.

Need some advice on investing and flipping? Get in touch today!  Kevin and Jennifer Hanley, REALTORS – The Hanley Home Team of Keller Williams Realty Atlantic Partners Southside – 904-515-2479 http://www.HanleyHomeTeam.com Team@HanleyHomeTeam.com

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Buying a Flip

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buying a flip, flip, flipped homes, flipping homes, Jacksonville, Jacksonville FL Real Estate, Jacksonville FL real estate agents, Jacksonville Real Estate, rehab, rehabbed homes

Have you recently fallen in love with a “flipped” home? Does the idea of moving into a cleanly renovated space excite you? To see an old home tuned up with brand new appliances, gleaming marble countertops, and fresh wood floors can make other homes seem shabby by comparison, but be careful before you make the leap. There are some precautions you want to take before you close.

“Flipped” or “rehabbed” homes are homes which real estate investors buy in order to renovate them and sell them for a profit. Sometimes these homes have been secured after short sales, foreclosures, surviving relatives, or even at auction. For real estate investors, part of the profit depends on how fast and affordably they can renovate the property. In seller’s markets, there’s even more pressure to make sure a home is ready to sell, fast.

While there’s nothing necessarily wrong with a flipped house, you will want to make sure you know a bit about the home’s history. Naturally, you’ll want to do all the due diligence you’d normally do when buying a home, but it can be useful to dig a little deeper. Here are some questions to ask:

1. What shape was the home in before it was renovated? Was it just outdated? Vacant? Trashed by squatters? Find out the state of the home when the flipper purchased it.

2. What deficiencies, damage, or other defects did the home have when the flipper bought it? Ask for a list of issues, if possible.

3. Who did the work on the house during the renovation? Contractors? Handymen? Did the flipper do the work personally? Are there invoices which detail the work completed and the money spent on the repairs? Were the appropriate permits secured?

4. Was anything left “as is”? What sort of issues were deemed too small or not vital to the renovation?

5. What was the legal history of the transfer of ownership? Short sales and foreclosures might have legal obligations on the flipper or other liens.

You shouldn’t shy away from a flipped home you love, but don’t go into the situation blind. We have experience working with buyers who have purchased flipped homes, and We’re be happy to help you navigate the questions. Let’s talk!

Kevin and Jennifer Hanley, REALTORS – The Hanley Home Team – Keller Williams Realty Atlantic Partners Southside 904-515-2479 http://www.HanleyHomeTeam.com