With more than 126,000 house-flipping investors in 2016 – the highest rate since 2007 – and an average gross profit of nearly $63,000, also a new ceiling since 2000, the personal-finance website WalletHub took an in-depth look at 2017’s Best Places to Flip Houses.
To help serious real-estate investors find the best markets to list their flipped properties, WalletHub’s data team compared the 150 largest U.S. cities across 22 key metrics. The data set ranges from median purchase price to average full home remodeling costs to housing-market health index.
Pittsburgh, Pennsylvania, has the highest average gross return on investment, 130 percent, which is 5.9 times higher than in San Jose, California, the city with the lowest at 22 percent.
|Best Cities to Flip Houses||Worst Cities to Flip Houses|
|1||El Paso, TX||141||Honolulu, HI|
|2||Sioux Falls, SD||142||Boston, MA|
|3||Fort Wayne, IN||143||San Jose, CA|
|4||Peoria, AZ||144||New York, NY|
|5||Oklahoma City, OK||145||Oxnard, CA|
|6||Tampa, FL||146||Los Angeles, CA|
|7||Grand Rapids, MI||147||San Francisco, CA|
|8||Boise, ID||148||Newark, NJ|
|9||Greensboro, NC||149||Yonkers, NY|
|10||Springfield, MO||150||Oakland, CA|
Best vs. Worst
- Cleveland has the lowest median purchase price, $46,250, which is 14.1 times lower than in San Jose, California, the city with the highest at $654,250.
- Memphis, Tennessee, has the highest share of home flips, 11.67 percent, which is 3.9 times higher than in Pittsburgh, the city with the lowest at 3.03 percent.
- Seattle has the highest housing-market health index, 9.833, which is 50 times higher than in New Orleans, the city with the lowest at 0.197.
- Orlando, Florida, has the most real-estate agents (per 100,000 residents), 163, which is 16.3 times more than in Brownsville, Texas, the city with the fewest at 10.
- Little Rock, Arkansas, has the lowest average full home remodeling costs, $75,888, which is five times lower than in Atlanta, the city with the highest at $375,734.
Five Arizona cities ranked in the top fifty (50) cities that Wallethub ranked and all ranked in the top 1o0. Peoria, Az ranked in the top 5 coming in at number 4.
|Rank||City||Total Score||‘Market Potential’ Rank||‘Renovation & Remodeling Costs’ Rank||‘Quality of Life’ Rank|
If you’re among the millions of HGTV viewers who’ve seen an episode of “Flip or Flop,” you’ve probably thought about the thrill of gutting a house and turning a five- or six-figure profit. But before you demo that pink-tiled ’80s kitchen, you need a stern reality check from the Property Brothers. Any experienced home flipper would caution you that transforming a real-estate beast into a bankable beauty is never as easy as it looks on TV.
In other words, don’t get your hands dirty until you’ve learned a thing or two about real estate, construction and how much damage your project could do to your wallet — and to the beam that’s keeping the roof from collapsing. Breathing new life into a low-cost property won’t necessarily return your full investment and allow you to pocket another $62,624, the average gross flipping profit in 2016. While home flipping enjoys its highest rate since 2007, according to RealtyTrac, the current homeownership rate is near the previous half-century low of 62.9 percent, which may translate to fewer potential buyers off the bat, depending on the location of your revamped property.
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