Did you know that the popularity of home flipping at any given point can serve as an indicator for the direction of our market? It’s true, and today we’re going to explain how this fact is reflected in what’s happening now.
Though shows centered on home flipping are still dominating American television, the number of people attempting to flip homes, themselves, is on the decline.
In total, about 45,900 single-family homes and condos were flipped in the third quarter of 2018, indicating a 12% decrease year over year and the lowest number of homes flipped in a quarter since Q1 of 2015.
Why does this matter, though? Well, home flipping projects generally represent about 5% of all home sales throughout the year. This drop in home flipping has served as the “canary in the coal mine” for today’s cooling market. And given that the popularity of flipping has been steadily dropping for three (nearly four) quarters now, it’s clear to see that this isn’t merely a fluke.
“While we don’t have a crystal ball, this much is clear: Our market is changing.”
Interestingly enough, this continued drop follows a similar pattern to what occurred the last time flipping lost popularity—following the rate hikes in mid-2013. Now that rates are set to rise once more, even after the recent decrease, it makes sense that fewer people are turning to home flipping as a means of income.
So, while we don’t have a crystal ball, this much is clear: Our market is changing. Whether you’re looking to buy or sell, now may be the time to make your move. Today’s decreased competition for sellers makes it a good time to list, while buyers should be aware that the chance to capture favorable rates won’t last forever.
If you have any other questions, would like more information, or are curious about how we can help you succeed with your real estate goals, feel free to give us a call or send us an email. We look forward to hearing from you soon.