HOUSINGNEWS REPORT
ORLANDO REAL ESTATE RECOVERS ITS MAGIC
The lack of distressed discounts for investors is translating into lower profits from home flipping in the Orlando area, according to the ATTOM Data Solutions Q2 2018 Home Flipping Report. The average gross flipping profit was $57,000 per flip for homes flipped in the second quarter,
down from an average gross flipping profit of $62,000 in Q2 2017. The average gross flipping profit of $57,000 represented a 39.3 percent gross return on investment per flip, down from 50.4 percent in Q2 2017 to the lowest level since Q2 2011 — a seven-year low.
With shrinking home flipping profits has come a decrease in home flipping activity. A total of 735 single family homes and condos were flipped in the Orlando metro area in Q2 2018, representing 6.0 percent of all sales — down 19 percent from a year ago, according to ATTOM. The 735 home flips in Q2 2018 were less than one- third of the peak 2,354 home flips in Q3 2005. While investors may not be flipping homes as much as in the last housing boom, a high percentage of cash sales in the Orlando area indicates that investors are still quite active. All-cash purchases accounted for 35.0 percent of all sales in Q2 2018, well above the national rate of 27.4 percent and up slightly from 34.7 percent a year ago. Nimkoff said he has seen two types of investors working the Orlando market: the ones that bought properties between 2008 and 2010, rented them out and are still holding them in portfolio; and what he called “direct buyers”, national companies that have
HOME FLIPPING PROFITS BY ZIP Q2 2018 Q2 2018 GROSS HOME FLIPPING RETURN ON INVESTMENT
-50.8%
352.4%
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SEP 2018 | ATTOM DATA SOLUTIONS
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