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.
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.