Real estate analytics first ATTOM Data Solutions found that fix-and-flips deals represented 7.2 percent of all home sales during the first quarter — the highest rate since the winter of 2010.
The rate of real estate investors that are fixing and flipping homes hit a near-decade high in the first quarter of 2019, according to a recent report from ATTOM Data Solutions.
In its first quarter 2019 Home Flipping report, ATTOM found that fix-and-flips deals represented 7.2 percent of all home sales during the first quarter — the highest rate since the winter of 2010. While flipping might be making a comeback as of late, ATTOM notes that gross profits fell.
Investors that homes flipped in the first quarter of 2019 saw an average gross profit of $60,000, which is a dip of about 12 percent from an average gross flipping profit of $62,000 in the previous quarter. That margin is also down from $68,000 in the first quarter of 2018 and hit its lowest average profit since the winter of 2016.
Providing a more detailed analysis, ATTOM analyzed the top 10 U.S. markets that had 50 or more flips in the first quarter of 2019 and with a population greater than 200,000 people.
The Memphis, Tennessee, metro is atop the U.S. flipping charts with a 13 percent home flipping rate, according to ATTOM. That’s up 10 percent from the previous quarter, however, Memphis is the only metro in the top 10 to report an annual decline of 9 percent.
Huntsville, Alabama, and Phoenix, Arizona, follow up Memphis with an 11.4 percent flipping rate, followed by Atlantic City, New Jersey at 11.1 percent, Las Vegas at 10.9 percent, Durham, North Carolina at 10.6 percent and Raleigh, North Carolina at 10.3 percent.
In total, ATTOM found that 85 out of 138 metro areas analyzed in the report posted a year-over-year increase in their home flipping rate in Q1 2019, including Columbus, Georgia, which is up 83 percent; Raleigh, North Carolina up 73 percent and Charlotte, North Carolina, up 65 percent.
While ATTOM found that flipping rates are up quarterly in every metro area, the annual percent change in gross returns has declined in every metro area in the top 10, with the exception of Clarksville, Tennessee.
Among its broader analysis of 138 metro areas with at least 50 home flips completed in the first quarter of 2019, those with the highest average gross flipping ROI were Pittsburgh, Pennsylvania at 131.2 percent, Flint, Michigan at 127.6 percent and Shreveport, Louisiana at 112.5 percent.
Homes flipped in the first quarter of 2019 took an average of 180 days to complete, which is an uptick from the average 175 days for homes flipped in Q4 2018 but down from 182 days in the winter of 2018.
Among the 138 metro areas ATTOM studied, those with the shortest average days to flip were McAllen-Edinburg, Texas at 127 days; Memphis, Tennessee at 136 days and Raleigh, North Carolina at 142 days.
For more information, check out ATTOM’s full report here.