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31 » VISIT US ONLINE @ DSNEWS.COM HOME FLIPPING DROPS TO FIVE-YEAR LOW IN Q3 Home flipping sales declined nationwide both quarter-over-quarter and year-over-year, hitting their lowest level since the second quar- ter of 2009, according to RealtyTrac's Q 3 2014 U.S. Home Flipping Report. e number of home flipping sales, or those in which a home is purchased and sold within 12 months, represented 4 percent of all single-fam- ily home sales in the U.S. in the third quarter, down from 4.6 percent from Q2 2014 and from 5.6 percent in the third quarter of 2013, accord- ing to RealtyTrac. e average gross return on investment for flipped homes in Q 3 was 36 percent, a slight in- crease from 35 percent in Q2 but a slight decline from 37 percent from the same quarter last year, according to RealtyTrac. e average gross profit per home flipped for investors was $75,990 in the third quarter, RealtyTrac reported. "Flipping returned to its historic norm of 4 percent in the third quarter as home price appreciation cooled in many of the hot flip- ping markets across the country," said Daren Blomquist, VP of RealtyTrac. "Meanwhile, the record-high average profits per flip in the quarter demonstrate that flippers are still filling an important niche in an aging housing market with historically low levels of new homes being built. e most successful flippers are buying older, outdated homes in established neighbor- hoods and rehabbing them extensively to appeal to modern tastes." e top five metropolitan areas with the most home flips were Miami (1,190), Phoenix (1,147), New York (1,070), and Tampa (789) with Tampa being the only one of those five that saw a year-over-year increase in home flips in Q 3, according to RealtyTrac. e top five metros that saw the highest year-over-year increase in home flips were Louisville, Kentucky (117 percent), Kansas City (66 percent), Boston (40 percent), New Orleans (38 percent), and India- napolis (35 percent). Metro areas with the highest return on investment for home flips in Q 3 were Baltimore (88 percent), Pittsburgh (79 percent), Detroit (61 percent), Richmond, Virginia (60 percent0, and Mobile, Alabama (59 percent), according to RealtyTrac. San Francisco, San Jose, Los An- geles, New York, Seattle, and San Diego posted the highest average gross profit among metros per home flip, all with more than $125,000 per home flip. "e markets with an increase in flipping tend to be those with older, distressed inventory still available that flippers can often buy at a dis- count and add value to," Blomquist said. "ose discounted distressed properties have become harder to find, but a recent jump in scheduled foreclosure auctions could provide more fodder for flippers in the next three to six months." e national average amount of time it took to complete a home flip in the third quarter was 185 days, a slight decrease from 187 days in Q2 but an increase from 133 days from the third quarter of 2013, RealtyTrac reported.

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