Buying a house, renovating it and reselling it as quickly as possible is the wordier way of saying flipping. In the time leading up to the housing market collapse that began in 2007, flipping was at a peak. In the first quarter of 2005, flipped sales accounted for 6.4% of all home sales before dropping to around 3% in the third quarter of 2008. In the first quarter of 2016 that percentage had risen to 4.4%.
Nationally, flipping a house in the first quarter of this year yielded a median gross profit of $56,000, about 17% higher than the $48,000 profit in 2005. On a percentage basis, the current median gross profit of 41.1% is lower than the 47.0% median in 2005. The time it takes to flip a house has also increased, from about 150 days to 154 days, since the second quarter of 2006.
CoreLogic has crunched the data and lists these as the top five metropolitan areas for flipping a house based on the percentage of flips:
- Memphis, Tenn.: 8.8%
- Fresno, Calif.: 8.3%
- Lakeland-Winter Haven, Fla.: 7.54%
- Virginia Beach-Norfolk-Newport News, Va.: 7.38%
- Miami-Miami Beach-Kendall, Fla.: 6.85%
Among the 20 metro areas with high flipping percentages, the highest gross profit percentages are posted in Chicago (68.4%); Richmond, Va. (68.2%); Palm Bay-Melbourne-Titusville, Fla. (67.4%), Virginia Beach (59.5%); and Jacksonville, Fla. (58%). The lowest numbers of days to flip among the 20 cities are posted in Memphis (111 days) and San Jose-Sunnyvale-Santa Clara, Calif. (114 days).
The five metro areas with the lowest percentage of flipped homes are:
- Hartford-West Hartford-East Hartford, Conn.: 1.75%
- New Haven-Milford, Conn.: 1.79%
- Bridgeport-Stamford-Norwalk, Conn.: 1.87%
- Worcester, Mass.: 2.22%
- Rochester, N.Y.: 2.24%
The highest gross profit margins among this group are posted in Hartford (84.0%); Pittsburgh (80.3%); Montgomery County, Pa. (75.5%), Bridgeport (74.6%); and Newark, N.J. (73.8%). The fastest turnarounds are available in Winston-Salem, N.C. (140 days) and Honolulu (148 days).
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