Apr 18, 2024 - News

Fewer home flips in Atlanta as profits plummet

Data: ATTOM; Note: A flip is defined as any transaction between an unrelated buyer and seller within 12 months of a previous transaction; Chart: Axios Visuals

The past year saw fewer dumpsters in driveways in metro Atlanta neighborhoods as house flipping decreased, mirroring a national trend.

Why it matters: Flipped houses made up 14% of the home sales in metro Atlanta last year, which, like many Sun Belt cities, is a hotbed for investors looking to profit off the high demand of housing.

  • The renovated homes can help stabilize neighborhoods but can also help fuel resident displacement.

Zoom in: Metro Atlanta investors flipped 13,365 properties in 2023, a 10.1% drop compared to the previous year, according to a recent report by real estate data firm ATTOM. That's still 98.1% above 2018 levels.

  • Flippers made a 16.4% gross return on investment, the report says.

Zoom out: Metro Atlanta made up more than half of Georgia's 20,894 flips in 2023.

The big picture: In 2023, house flipping activity nationwide dropped 29.3%, the biggest annual decline since 2008, according to the report.

  • Return on investment, at 27.5%, hasn't been this bad since 2007. The ROI was down from 28.1% in 2022 and 35.7% in 2021.

Of note: Four Texas metros — Austin, Dallas, San Antonio and Houston — saw the weakest home-flip returns in 2023 among cities with at least 1 million in population, including a 4.1% loss in Austin, per ATTOM's report.

What's next: Buying a fixer-upper is one way for wishful homeowners to squeak out a deal in some U.S. markets, if they can beat investors.

  • In Atlanta, buying a house that needs some work could save $109,000, per a recent study by StorageCafe.

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