The Top 10 Zip Codes For Home-Flipping Profits

Real Estate

Kirkland, Washington, the Seattle suburb that had one of the nation’s first clusters of Covid-19 cases at its Life Care Center nursing home early last year, led the U.S. for home-flipping profits during 2021’s second quarter, according to an AATOM report ranking the nation’s zip codes.

A typical home flip in the 98033 zip code, which is the section of the city bordering Lake Washington where waterfront homes have views of the Seattle skyline, had a profit of $516,500, the AATOM report said on Friday. Home flippers are real estate investors who buy a home, often a fixer-upper, and renovate it to sell at a profit.

Citywide, homes in Kirkland sold at a median price of $715,900 in the second quarter, more than double the U.S. median price for the same period, according to data from the National Association of Realtors. Prices rose 25% in Kirkland from 2020’s second quarter, a faster pace than the 23% gain nationwide, NAR said.

The No. 2 market in the AATOM report was the 15317 zip code in Canonsburg, Pennsylvania, with a typical profit of $426,082 for a home flip. Next was the 46074 zip code in Westfield, Indiana, with $404,618 of profit, the 19709 zip code in Middletown, Delaware, at $373,280, and 20001, the Brightwood Park neighborhood in Northwest Washington D.C., at $372,500 of profit, the report said.

Ranking five through 10, the 68022 zip code in Elkhorn, Nebraska was next, at $372,500 of profit, followed by 07871 in Sparta, New Jersey, at $326,755, 34120 in Naples, Florida, at $322,500, 68046 in Papillion, Nebraska at $308,000, and 73034 in Edmond, Oklahoma at $296,000, the AATOM report said.

Nationwide, 79,733 single-family homes and condominiums were flipped in the second quarter, representing 4.9% of all home sales, or one in 20 transactions, the AATOM report said. 

That’s up from 3.5%, or one in every 29 home sales, in the first quater – the first increase in more than a year – but was down from 6.8%, or one in 15 sales, in 2020’s second quarter, the report said.

As the flipping rate rose from the prior quarter, profit margins dipped to a 10-year low, as prices for homes and building material surged, AATOM said.

While the gross profit on the typical home flip nationwide increased to $67,000 in the second quarter – up 2.4% from $65,400 in the first three months of 2021, and 3.1% from $65,000 in 2020’s second quarter, the return on investment fell, the report said.

The typical home-flipping project had a 34% return on investment, or ROI, in the second quarter, the lowest point since 2011’s first quarter, the report said.

That was down from 37% in the first quarter, and it was 7 percentage points below the second quarter of 2020, the largest year-over-year drop since mid-2014, the report said.

Products You May Like

Articles You May Like

Stocks making the biggest moves midday: Tesla, PayPal, Pinterest and more
Stocks making the biggest moves midday: Pinterest, Sonos, Anthem and more
Fed limits trading by top officials in wake of ethics scandal
Court hears oral arguments in muni advisor exemption lawsuit
Top Wall Street analysts see upside in these stocks as earnings season continues

Leave a Reply

Your email address will not be published. Required fields are marked *