$245,000 ROI: Flips Slow Down in DC But Profits Don't

• December 17th 2020

by Nena Perry-Brown

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A new report on the home flipping market indicates a slowdown in flipping activity in the DC area, but profits that are still on the rise.

Six percent of houses sold in DC proper during the third quarter of 2020 were flips, according to the latest ATTOM Data Solutions report, a drop from the second quarter's share of 9.5%. These 125 flipped houses were purchased for a median price of $365,000 and sold for a median price of $610,000, yielding a gross profit of $245,000. For context, gross profits were $219,000 in the third quarter of 2019. 

The gross return on investment (ROI) citywide for flips was 67.1% in the third quarter, higher than the 65.4% gross ROI observed in the third quarter of 2019. However, there were only four zip codes where more than 10 houses were flipped last quarter.

The 20019 zip code, which includes neighborhoods like Deanwood, Lincoln Heights, and Fort Dupont, remains the city's hottest for flip activity, with 27 flips representing nearly 19% of houses sold last quarter. Flipped houses in this zip code also grossed the highest ROI, at 95.6%. 

The 20011 zip code that includes areas like Petworth and 16th Street Heights remains in second place for number of flips (18), but continues to yield the highest citywide gross profit at $382,000 — an increase from $315,000 in third quarter 2019.

For number of flips, the 20018 zip code, which includes Brentwood, Woodridge, and Fort Lincoln, came in higher than the 20002 zip code of H Street, Eckington, and Kingman Park. On the other hand, gross profit and ROI were higher in the 20002 zip code ($299,750 and 59.8%, respectively) than in the 20018 zip code ($226,375 and 56.3%, respectively). 

Note — The report does not factor in renovation costs when calculating the ROI, although experienced flippers estimate those to be anywhere from 20-33 percent of the original purchase price. Arlington County did not have enough flips for data to be included.

This article originally published at http://dc.urbanturf.production.logicbrush.com/articles/blog/flips-slow-down-in-dc-but-profits-dont/17665.