Flipping without flopping
New survey homes in on Dallas as No. 3 city to flip a house for profit
Over the years, TV shows like Flip or Flop and Good Bones have somewhat glamorized the practice of flipping houses for a profit.
But at its foundation, how wise is house-flipping as an investment strategy? Well, if you’re buying property in Dallas, it might pay off handsomely.
Realtor.com ranks Dallas as the third best place in the country for flipping houses. Only top-ranked Columbia, South Carolina, and second-ranked Phoenix eclipse Dallas on the list. Raleigh, North Carolina and Columbus, Ohio round out the top five.
To come up with the list, the respected real estate site looked at the median profit for flips in the 150 largest metro areas compared with the same time a year ago. To be included, a metro had to have had at least 50 flips from April to June. A home flip is defined as the same property being resold within 12 months of the most recent purchase.
In Dallas, Realtor.com found the median profit for a flip was $71,383, with a median list price of $396,500 in September. The median year-over-year profit percentage grew 6.6 percent.
“While prices have risen over the past year or so, buyers still don’t need to be millionaires to own new homes,” Realtor.com says of the Dallas market. “Since competition isn’t as fierce for older homes that may need some work, flippers can get a fixer-upper for less than $150,000.”
The site notes that although the number of home flips across the country has reached record levels, profits are shrinking.
“There is opportunity, but you’ve really got to be smart in where you purchase and know that market,” Charles Tassell, chief operating officer of the National Real Estate Investors Association, tells Realtor.com. “Finding the right spot is the hard part right now.”
The worst place to flip a house right now? According to the survey, that dubious distinction goes to Chattanooga, Tennessee, where flippers are losing about 21.2 percent.