ATTOM Data Solutions’ Q1 2017 U.S. Home Flipping Report revealed that 43,615 single family homes and condos were flipped during Q1 2017, which was an 8% decrease from the previous quarter and a 6% decrease from a year ago. Home flips in Q1 2017 accounted for 6.7% of all single family home and condo sales during the quarter, up from 5.8% in the previous quarter and unchanged from a year ago.
A home flip is defined as a property that is sold in an arms-length sale for the second time within a 12-month period. One-third (33.3%) of all single family homes and condos flipped in Q1 2017 were purchased by the flipper with financing, up from 31.9% in Q4 2016 and up from 29.5% in Q1 2016 to the highest level since Q3 2008, when 37.6% of completed home flips were purchased by the flipper using financing.
“The business of financing for home flippers continued to grow in the first quarter of 2017 even as the home flipping rate plateaued compared to a year ago and average home flipping returns decreased for the second consecutive quarter,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “Home flippers financed an estimated $3.5 billion in purchases for homes flipped during the quarter, up from $3.3 billion in the previous quarter and up from $2.4 billion a year ago to the highest level since the fourth quarter of 2007 — a more than 9-year high.”
Among 85 metropolitan statistical areas with at least 90 completed home flips in Q1 2017, those with the highest share originally purchased by the flipper with financing were Colorado Springs, Colorado (69.3%); Denver, Colorado (54.8%); Seattle, Washington (51.6%); Boston, Massachusetts (51.3%); and Providence, Rhode Island (47.3%).
The District of Columbia had the highest home flipping rate in the nation in the first quarter (10.7%), followed by Nevada (9.8%); Alabama (9.0%); Tennessee (8.9%); Maryland (8.5%); and Missouri (8.0%).