When it comes to flipping real estate, Connecticut showed strong growth in 2015. Two metro areas also showed high levels in terms of price and activity.
The study by RealtyTrac, a provider of housing data, said among states with at least 1,000 single family homes flipped in 2015, those with the biggest year-over-year increase in share of flips were Connecticut (up 23 percent); Oregon (up 21 percent); Maryland (up 19 percent); Illinois (up 18 percent); and New Jersey (up 17 percent).
A home flip is defined as a property that is sold in an arms-length sale for the second time within a 12-month period based on publicly recorded sales deed data collected by RealtyTrac in more than 950 counties, accounting for more than 80 percent of the U.S. population.
And the trend isn’t exactly good news.
“When home flipping numbers go up, it is usually an indication that the housing market is in trouble,” said Matthew Gardner, chief economist at Windermere Real Estate. He said the problem with a rise in home flipping is that these sales artificially inflate home prices, making housing even less affordable for buyers and increasing the risk of a bubble
Metro areas with the biggest year-over-year increase in share of flips were Lakeland, Florida (up 50 percent); New Haven, Connecticut (up 45 percent); Jacksonville, Florida (up 41 percent); Homosassa Springs, Florida (up 40 percent); and Akron, Ohio (up 37 percent).
Markets with the biggest increase in average flipping gross return on investment in 2015 compared to 2014 were Boise, Idaho (85 percent increase); Hartford (51 percent increase); Ocala, Florida (49 percent increase); Homosassa Springs, Florida (41 percent increase); and Huntsville, Alabama (39 percent increase).
