House Flipping Volume In St Louis Down From Year Ago

During the first quarter of this year, there were 600 home “flips” in St Louis or about 8.6% of the homes sold in St Louis, according to data just released by ATTOM Data Research.  This rate of flipped homes is up 5% from the prior quarter, however, is down 7% from a year ago. The decline certainly doesn’t have anything to do with a lack of interest by investors in flipping, it has more to do with a low inventory and declining mortgage delinquency and foreclosure rates reducing the opportunities.

What is a “flipped” home?

In the report issued by ATTOM Data Research, any home or condo that was sold during the first quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months as well, was considered a “flip”.  Since homeowners don’t tend to buy a home only to turn around and resell it within a year, when this does occur it is typically the result of an investor buying a property, renovating it, then reselling it.

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House Flipping Activity In St Louis Last Year Same As Year Before

Flipping houses, something that went from something a few professional speculators only did years ago when I was actively buying homes for resale, became somewhat of a national pastime during the real estate boom years in the 2000 – 2007 period.  House flipping in St Louis, while being done less than 10 years ago at nearly the peak of the bubble market, is still alive and well in St Louis.  As the table below shows, during 2015 there were 2,386 homes flipped in the St Louis metro area, just about the same exact number as there were in 2014.

For the purposes of this article, a property that is sold, in an arms-length sale, for the second time within a 12-month period is considered a home flip.

St Charles County saw decline in house flipping…

As the data below illustrates, St Charles county was the only county in the St Louis core market that saw a decline in house flipping during 2015 from the year before and Franklin county saw the largest increase.

Gross profit on flips..

The second table down, shows the median gross profit, as well as return on investment (ROI) for house flips during 2015 by county.

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