Attom Data Solutions [1] announced that 53,705 single-family homes and condos were flipped during Q1 2020—representing 7.5% of all home sales during the quarter.
This is an increase from 6.3% in Q4 2019 and 7.3% in Q1 2019. The most recent data is the highest level since Q2 2006.
The profit on the average home flip across the nation increased in the quarter to $62,300, which is up slightly from Q4 2019’s $62,000 and Q1 2019’s $60,675.
“Home flipping has gradually taken up a larger portion of the housing market over the last couple of years. But profits are down and are lower than they’ve been since the dark days following the Great Recession, which is a sign that investors aren’t keeping up with price increases in the broader market,” said Todd Teta, Chief Product Officer at ATTOM Data Solutions. “Enter now the Coronavirus pandemic and the prospects for home flipping are notably uncertain, at least in the short term. We should know a lot more in a few months about whether home prices drop and investors get hit hard, or whether they can increase their profit margins.”
Home flips as a portion of all home sales rose from Q4 2019 to Q1 2020 in 122 of the 140 (87.1%) metros studied in the report.
The largest quarterly increase in home flipping was in Boston, which rose to 80.2%. Close behind was Springfield, Massachusetts (76%); Olympia, Washington (73%); York, Pennsylvania (71.4%); and Minneapolis (69.3%).
The only decline in annual flipping rates among metros with a population of at least 1 million were San Antonio (-12.9%); Austin (11.8%), Oklahoma City (-6.1%); and Houston (-0.6%).
Home flipped during Q1 2020 were sold for an average price of $232,000, with a gross flipping profit of $62,300 above the median purchase price of $169,700.
However, with purchase prices on investment properties continuing to rise faster than resale values, the 367% return on sales prices against Q1 2020 was down from 39.5% in Q4 2019 and 40.9% in Q1 2019.