Flipped Houses In St Louis Jumps Nearly 14 Percent During First Quarter

There were 542 homes “flipped” in the St Louis metro area during the first quarter of 2020, or 8.5% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is an increase of 13.8% from the prior quarter and is a decrease of 2% from a year ago.  The median gross profit was 52,900 a 60.8% gross ROI.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be 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.  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.

  

St Louis House Flipping – 1st Quarter 2020

St Louis House Flipping - 1st Quarter 2020© 2019 – St Louis Real Estate News, all rights reserved

Bernie’s Plan For Housing Likely To Negatively Impact Investors

Let me begin with this is not a political statement and the purpose of this site is not about politics but about real estate.  Having said that, this morning I came across the plans for the housing market that Bernie Sanders is proposing if he is elected President which I had not seen before.  Upon reviewing his plan (it is on his official site) I realized that while many of the components of it sound good (like “End homelessness and ensure fair housing for all”) many of his promises in this area sound like things that would negatively impact investors and the housing market as a whole.

The following are the Key Points to the Bernie Sanders housing plan from his website (I have included the complete list):

  • End the housing crisis by investing $2.5 trillion to build nearly 10 million permanently affordable housing units.
  • Protect tenants by implementing a national rent control standard, a “just-cause” requirement for evictions, and ensuring the right to counsel in housing disputes.
  • Make rent affordable by making Section 8 vouchers available to all eligible families without a waitlist and strengthening the Fair Housing Act.
  • Combat gentrification, exclusionary zoning, segregation, and speculation.
  • End homelessness and ensure fair housing for all
  • Revitalize public housing by investing $70 billion to repair, decarbonize, and build new public housing.

Under the “When Bernie is president, he will” section are some of the things he plans to do to accomplish the above goals (this list is rather extensive on his site so I have only included a sampling of the items that appear will negatively impact investors and homeowners):

  • Enact a national cap on annual rent increases at no more than 3 percent or 1.5 times the Consumer Price Index (whichever is higher) to help prevent the exploitation of tenants at the hands of private landlords.
  • Allow states and cities to pass even stronger rent control standards.
  • Implement a “just-cause” requirement for evictions, which would allow a landlord to evict a tenant only for specific violations and prevent landlords from evicting tenants for arbitrary or retaliatory reasons.
  • Place a 25 percent House Flipping tax on speculators who sell a non-owner-occupied property, if sold for more than it was purchased within 5 years of purchase.
  • Impose a 2 percent Empty Homes tax on the property value of vacant, owned homes to bring more units into the market and curb the use of housing as speculative investment.

Again, this is not a political piece, but given the strong housing market we have enjoyed over the past several years, which has helped many Americans build equity and recover wealth lost during the housing bubble burst of 2008, I think it’s worth noting proposed plans, by any party or power, that could negatively impact the market. Also, these are just talking points from someone running for office, so whether it’s Bernie Sanders or any other candidate, or even the current President, Donald J. Trump, they can all have ideas but getting them implemented takes cooperation of Congress and that is not always so easy so it doesn’t mean any of their plans ever actually come to fruition.

 

 

St Louis House Flips Continue To Decline

There were 762 homes “flipped” in the St Louis metro area during the third quarter of 2019, or 6.3% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is a decline of 15% from the prior quarter as well as a 5% decrease from the prior year.  As our table below shows, on a national level, house flipping accounted for just 5.4% of the homes sold during the 3rd quarter of this year, which is a 9% decrease from the quarter before and a 4% increase from a year ago.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be 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.  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.

  

St Louis House Flipping – 3rd Quarter 2019

St Louis House Flipping - 3rd Quarter 2019© 2019 – St Louis Real Estate News, all rights reserved

St Louis Is Number One Market For Flipping Homes

St Louis is the top marketing for flipping homes, according to an article published yesterday on Realtor.com.  It’s not all just flipping activity however in the article a very notable and credible St Louis industry source (unabashed self-promotion) stated that “flipping is more common in homes in the $175,000-plus range, while many of those listed for $125,000 and less are being turned into rentals, says Norman.”

The Realtor.com article gave an overview of the market data I produced for them so I wanted to share the market data behind the overview.

St Louis Neighborhoods With Large Investor Presence:

  • 63137 Zip Code Area (Bellefontaine Neighbors/Glasgow Village) – 43.5% of housing units are investor-owned
  • 63135 Zip Code Area (Ferguson) – 39.2% of housing units are investor-owned
  • 63033 Zip Code Area (Florissant Area) – 21.8% of housing units are investor-owned

Home Prices In St Louis’ Active Investor Markets:

House Flipping In St Louis Drops 12 Percent In 2nd Quarter

There were 902 homes “flipped” in the St Louis metro area during the second quarter of 2019, or 7.5% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is a decline of 12% from the prior quarter but is an 8% increase from the prior year.  As our table below shows, on a national level, house flipping accounted for just 5.9% of the homes sold during the 2nd quarter of this year, which is an 18% decrease from the quarter before and a 9% increase from a year ago.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be 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.  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.

  

St Louis House Flipping – 2nd Quarter 2019

St Louis House Flipping - 2nd Quarter 2019© 2019 – St Louis Real Estate News, all rights reserved

Flipped Homes in St Louis Down From Year Ago

There were 528 homes “flipped” in the St Louis metro area during the first quarter of 2019, which equated to 7.7% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Research.  This is down 14% from the 1st quarter of 2018 but does reflect a 3% increase from the prior quarter.  As our table below shows, on a national level, house flipping accounted for 7.2% of the homes sold during the 1st quarter of this year, which is a 23% increase from the quarter before and an 8% increase from a year ago.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be 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.  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.

  

St Louis House Flipping – 1st Quarter 2019

St Louis House Flipping - 1st Quarter 2019

Number Of St Louis Home Flips Declines in 2018 From Year Before

There were 3,143 home “flips” in the St Louis metro area during 2018, according to data just released by ATTOM Data Research.  With 7.4% of homes sold in St Louis being a flip in 2018, this is a decline of 3.7% from a year ago.  The peak number of flips in St Louis came in 2005 when there were 4,426 homes flipped.

What is meant by “flipped” home?

ATTOM Data considers any home or condo that was sold during the third quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months as well as 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.

  

St Louis House Flips 2018

St Louis House Flips 2018

St Louis House Flips Average Gross Profit

St Louis House Flips Average Gross Profit