Aspiring house flippers are constantly looking for prime locations where their investments can yield substantial returns, and recent data indicates that certain areas are emerging as hot spots for house flipping.
Because of its low remodeling costs, high sales rates, and 20% return on investment, Arizona ranks as the top state for real estate investors seeking to maximize their profits in a booming housing market, according to a study from Highland Cabinetry.
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"Choosing the best state is based on preference," said James McAllister, a spokesperson for the company. "It's important to realize that the average sales price is dependent on the investment house flippers make. This means that lower remodeling prices are good for house buyers and sellers."
Top 10 States For House Flippers
| State | Most expensive remodeling price | Cheapest remodeling price | Average remodeling price | House sales per capita | Average house sale price | Score |
| Arizona | $67,412 | $60,975 | $64,194 | 76.8 | $429,787 | 72 |
| Florida | $62,377 | $55,532 | $58,954 | 73.6 | $396,318 | 69.6 |
| Colorado | $66,771 | $61,879 | $64,325 | 58.5 | $548,602 | 69.6 |
| Hawaii | $84,997 | $79,934 | $82,466 | 26.2 | $856,327 | 69 |
| Idaho | $60,531 | $59,584 | $60,058 | 64.5 | $449,952 | 68.3 |
| North Carolina | $63,059 | $58,396 | $60,728 | 75.7 | $328,181 | 68 |
| California | $93,196 | $73,567 | $83,382 | 30.1 | $782,695 | 67.8 |
| South Carolina | $63,132 | $61,789 | $62,461 | 77.3 | $292,948 | 67.3 |
| Washington | $75,144 | $68,962 | $72,053 | 46.5 | $588,986 | 66.8 |
| Tennessee | $62,913 | $58,596 | $60,755 | 72.5 | $316,473 | 66.4 |
| National Average | $71,777 | $63,806 | $67,791 | 46.9 | $360,643 | 58.7 |
Source: Highland Cabinetry
According to real estate data provider ATTOM's 2024 U.S. Home Flipping Report, home flipping activity and profits rose across the U.S. in the first quarter. The report showed that 67,817 single-family homes and condominiums were flipped in the first quarter, accounting for 8.7% or one of every 12 home sales nationwide from January through March.
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The latest share of home sales was up from 7.7% in the fourth quarter of 2023 but still down from 9.8% in the first quarter of last year.
The typical first quarter profit margin stayed about 25 percentage points below the peak high in 2016. Gross profits on a typical flip increased to $72,375, down from a high of about $80,000 reached in 2022 but up from $65,000 in the fourth quarter of 2023 and about $10,000 higher than last year's low point.
"The latest numbers show that investors still face an uphill climb to clear significant profits after expenses," ATTOM CEO Rob Barber said. "They, like others, also face tenuous times amid a housing market boom that's cooled down over the past year. But we now have a year's worth of a trend showing that things have started to turn around for the flipping industry, with clear signs of increasing interest flowing into the market."
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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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