D.C. Neighborhoods Are Big Money Makers For House Flippers
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LANHAM, Md. (WNEW) — House flipping is an increasingly popular endeavor in D.C., and several District neighborhoods are on a new list of the biggest house flipping money-makers in the U.S.
If you’re not an HGTV fan, house flipping is when a home is purchased and then quickly resold for a profit. Usually, a lot of repairs and upgrades are involved.
The real estate brokerage firm Redfin analyzed 11 housing markets for its report, and the average return on a flipped home in 2013 was well over $100,000.
But flippers made the most money in the Petworth area of D.C., bringing in about $312,400 per flip.
Brookland/Catholic University was third on the top 10 list ($271,900), Fort Totten was sixth ($233,300) and the Stadium/Armory area came in seventh ($230,400).
Rounding out the top 10 were neighborhoods in Portland, Oregon, Los Angeles and San Francisco.
The Canton area of Baltimore was number 20 on the list ($145,600).
The report also says that D.C. is one of the markets, including Philadelphia and Atlanta, that have seen flipping activity increase this year when compared with year-to-date activity in 2013.
However, “while big gains in home prices have created big opportunities for flippers, the number of homes being flipped is nowhere near the volume of 2005, which was the peak flipping year at 101,800 homes,” Redfin reports.
Back then, “homebuyers could easily access zero-down financing, which led to heightened activity from amateur investors who bought several homes without any upfront costs, and who planned to resell them at a profit,” according to Redfin chief economist Nela Richardson.
Nowadays, more flippers are developers, corporate investors or experienced, all-cash buyers.