Home flips hit 6-year high
Home flipping in the second quarter of 2016 increased sharply from the first quarter and hit a new 6-year high.
The latest data from ATTOM Data Solution’s RealtyTrac shows that there were 51,434 single-family homes and condos flipped in the three months to the end of June 2016, up 14 per cent from the previous quarter and up 3 per cent from the second quarter of 2015.
The proportion of sales that were flips (5.5 per cent) declined from the first quarter (6.7 per cent) but was up slightly from a year earlier (5.4 per cent).
“Home flipping is becoming more accessible for smaller operators thanks to an increasingly competitive lending environment with more loan options for real estate investors, who are also benefitting from the historically low mortgage interest rates,” said Daren Blomquist, senior vice president at ATTOM Data Solutions. “That favorable lending environment for flippers has helped to fuel the recent flipping frenzy we’ve seen over the past five quarters.”
The majority of the transactions were in cash (68.3 per cent) but the trend is towards greater use of financing.
With 39,775 investors completing at least one flip in the second quarter of 2016, it was the highest level since 2007. The average profit per flip increased to $62,000 from $57,900 a year earlier.
Renters losing confidence amid high prices, tight supply
Renters continue to be under pressure when it comes to moving into home ownership and concern over high home prices and tight supply weigh heavily.
The National Association of Realtors’ latest report shows that despite 78 per cent of homeowners saying now is a good time to buy, that figure is down from 80 per cent in June and 82 per cent in March. For renters, the figure is 60 per cent, down from 68 per cent at the end of last year.
“Very affordable mortgage rates and strong job gains among young adults should be translating to a higher rate of homeownership. It’s not, and as a result, sales to first-time buyers remain stuck below a third of all sales,” commented Lawrence Yun, NAR chief economist.
He said that even though home loans
are at historic lows, tight inventories continue to push prices higher but he added that first-time buyers may not realize that mortgages are available without a 20 per cent downpayment.
Sotheby’s gets geeky with new marketing initiative
Realogics Sotheby’s International Realty (RSIR) has announced an innovative move to help its listings reach new potential buyers.
The firm has partnered with technology website GeekWire for a marketing initiative called ‘Geek Home of the Week’ which will see homes featured on the site with readers able to vote to select a winner.
“The tech community is clearly an economic driver and GeekWire is an industry leader to reach this consumer,” said Dean Jones, President and CEO of RSIR. “Our platform is fun, informative and a functional way to see what’s trending in real estate. We’re just getting started.”
GeekWire attracts 1 million unique visitors a month and has 25,000 active subscribers, which puts the listings in front of a lot of eyes!