5. New Castle County, Del.
> Return on investment: 52.8%
> Increase in foreclosures: 28.6%
> Unemployment rate: 5.9%
> Number of flips: 117
Home flippers in New Castle County were able to turn a 52.8% gross profit on homes they purchased for an average price of $127,795 between April 2013 and March 2014. The median home price in the area of $174,800 in the same 12 months far exceeded the estimated median household income of $63,022 for 2014. The relatively high risk home buyers are taking may in part explain the recent rise in foreclosures, which increased by nearly 29% between the first quarter of last year and the first quarter of 2014. While the higher foreclosure rate indicates area homeowners may be struggling, the increased number of distressed properties is good news for home flippers.
4. Campbell County, Ky.
> Return on investment: 69.9%
> Increase in foreclosures: 238.5%
> Unemployment rate: 6.3%
> Number of flips: 163
The median home price in Campbell County was $90,800 in the 12 months through March 2014, among the lower median prices nationwide. The area’s estimated median income for 2014 was comparably low as well, at slightly less than $60,000. This suggests homebuyers did not commit to mortgages well in excess of their income. And yet, foreclosures in Campbell County increased dramatically in recent months, jumping by 238% between the first quarter of 2013 and the first quarter of 2014, boosting the potential inventory for home flips. More distressed homes may help flipping activity return to 2013 levels, when more than 10% of all home sales were flips. Flipped homes accounted for just 3.4% of sales as of the beginning of 2014.
3. Baltimore County, Md.
> Return on investment: 70.8%
> Increase in foreclosures: 32.3%
> Unemployment rate: 6.1%
> Number of flips: 546
With a nearly 71% gross return on flipped homes in Baltimore County, it may not be surprising that there were 546 home flips between April 2013 and this past March, among the higher volumes of home flips nationwide over that period. Unlike many other counties located in Maryland, Baltimore County residents were not exceptionally wealthy, with an estimated median household income of just $64,393 in the county for 2014. Total foreclosures rose by 32% between the first quarter of 2013 and the first quarter of 2014, among the larger increases nationwide. This could continue to attract house flippers to the area.
2. York County, Pa.
> Return on investment: 72.5%
> Increase in foreclosures: 10.2%
> Unemployment rate: 5.9%
> Number of flips: 179
Home flipping activity has declined dramatically in York County since its peak at the end of 2012, when 37% of all metro area home sales were flips. Despite the decline, flipping homes in the county remains quite profitable. Real estate investors purchased potential flips for around $88,000 on average, considerably less than the majority of strong home-flipping markets. Over the last 12 months or so, flippers were able to sell these homes for an average of close to $152,000 — a gross return on investment of nearly 73%.
1. Prince George’s County, Md.
> Return on investment: 83.4%
> Increase in foreclosures: 136.8%
> Unemployment rate: 6.0%
> Number of flips: 347
Flippers in Prince George’s County earned more than 83 cents on the dollar, among the best gross returns on real estate investment nationwide. Further contributing to the quality of the overall flipping market, foreclosures rose by 137% between the first quarter of 2013 and the first quarter of 2014, providing new inventory for flippers. Additionally, the unemployment rate was just 6%, offering signs of a reasonably good economy for potential buyers. Unsurprisingly, Prince George County is located in Maryland, where incomes are relatively high. Median household income in the county is estimated at $71,931 for 2014, more than in the vast majority of counties nationwide.
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