Most people buy houses to live in them. Some people buy them to make short-term profits. The profit on a median-priced home nationwide, which cost $350,000 in the second quarter, was 47.4%. People who take the risk of flipping homes did very well in the second quarter of 2023. (These are each state’s worst county to live in.)
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“Just when it looked like the housing market was flattening out, prices spiked again, which pushed seller profits back up to nearly their highest level in the past decade,” said Rob Barber, CEO of property data provider ATTOM. This is mostly because there is little inventory, and even though mortgages are near 7%. Home flippers often pay cash, however.
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The profit yield of a home purchased and one sold rose in 107 of the 156 markets compared to the first quarter.
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The largest raw profit margins by city were in San Jose, San Francisco and San Diego, with profits of $600,00, $416,000 and $325,500, respectively, followed by Seattle at $285,000 and Naples, Florida, at $265,905. The west coast cities on the list are among the markets in the United States with the highest median prices.
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On the other hand, the houses with the lowest price increases in the second quarter were in Shreveport, Louisiana, at $14,000; Beaumont, Texas, at $24,943; Rockford, Illinois, at $38,140; McAllen, Texas, at $41,407; and Toledo, Ohio, at $43,000. Once again, no surprise. These are among the cities with the lowest home prices.
The Market Where the Most People Make Money Flipping Houses
© Michael Vi / iStock via Getty Images
Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
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