Home flipping drops to 4-year low in 2020

Home flipping drops to 4-year low in 2020

Home flipping drops to 4-year low in 2020
The number of investors who are flipping homes in the U.S. is on the decline, according to a new report. The decline is likely due to a sharp increase in home prices and flippers concerned about narrowing profit margins. According to ATTOM Data Solutions' year-end 2020 U.S. Home Flipping Report, single family homes and condos that were flipped last year declined in volume by 13.1 percent from the previous year. In total there were 241630 properties flipped in 2020, the lowest amount since 2016.

Home flips are properties purchased by investors, often renovated and sold in an arms-length transaction within a 12-month period. The average flip in 2020 generated a gross profit of $66,300 or a 40.5 percent return on investment compared to the original acquisition price. This is down from 41.5 percent in 2019 and the lowest ROI since 2011.

Meanwhile, those looking for a new place to live will find conforming no-point 30-year fixed mortgage rates are averaging 3.0 percent and 15-year rates are near 2.375 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.