Home flipping activity and profits rise across the United States in the first quarter of 2024

According to ATTOM’s first-quarter 2024 U.S. Home Flipping Report, 67,817 single-family homes and condominiums in the U.S. were flipped. Those transactions accounted for 8.7 percent, or one out of every 12 home sales overall, from January to March 2024.

The current figure was up from 7.7 percent of all house sales in the United States during the fourth quarter of 2023, marking the second consecutive quarterly increase. At the same time, the percentage was still lower than 9.8 percent in the first quarter of last year.

As flipping rates rose, fortunes improved for investors who bought and swiftly sold residences. According to the most recent data, home flippers earned an average of 30.2 percent gross profit countrywide before expenses on homes sold in the first quarter of this year, the third time in four quarters that margins climbed after six years of mostly constant reductions.

The normal first-quarter profit margin for home flips, calculated as the difference between the median buy and median resale price, was roughly 25 percentage points lower than the peak in 2016. It also remained within a range that might be easily depleted by carrying costs such as renovation fees, mortgage payments, and property taxes.

However, it was up from the fourth quarter of 2023 and a decade-low of almost 25% in the first quarter of last year.

Gross revenues from typical flips across the country jumped to $72,375. The figure stayed lower than the high of around $80,000 in 2022. However, it increased from $65,000 in Q4 2023 to almost $10,000 higher than the previous year’s low.

“The latest numbers show that investors still face an uphill climb to clear significant profits after expenses,” stated ATTOM CEO Rob Barber. They, like others, are facing difficult times amidst a property market bubble that has slowed over the last year.

But we now have a year’s worth of data indicating that things have begun to improve for the flipping sector, with obvious indicators of increased demand streaming into the market.

Profits and profit margins have continued to grow over the last year, indicating a renewed trend of investors benefiting from price swings in their favor between purchase and resale.

In the first quarter of 2024, the average countrywide sales price for flipped homes was $312,375, up 4.1 percent from the fourth quarter of 2023. The surge surpassed the 2.1 percent spike in median prices that recent home flippers were experiencing when purchasing their properties. Similar gaps appeared annually, resulting in quarterly and yearly improvements in investment returns.

ATTOM examined sales deed data for this report. A single-family house or condo flip was defined as any arms-length transaction that ensued in the quarter and followed a previous transaction on the same property during the preceding 12 months.

The moderate gross flipping profit is the difference between the purchase and flipped prices (excluding rehab expenditures and other expenses; flipping veterans say range between 20% and 33% of the property’s after-repair worth).