Best State to Flip a House, Research Paper Example

Despite the recent downturn in the economy, there are still best states to flip houses. USA Today reports from this year state that in 2013 “investors bought more than 156,000 homes, only to fix them up and quickly resell them for an average profit of $58,081” (para. 1). With the stabilization of house prices due to a lack of houses on the market in 2014 (para. 3). Decently priced homes that are being flipped for a profit are centered around the east coast (Frohlich & Sauter, 2014, para. 1), with an average profit of anywhere from $80,000 to $100,000 (Realtor, 2014, para. 3). The best state for making a profit in flipping houses is Maryland, and in particular Prince George’s County (Realtor, 2014, para. 17). The average purchase price is low at an average of $125,011 with the average house going for around $229, 275 (Realtor, 2014, para. 17). This makes for an average return on investment (ROI) 83.4% (Realtor, 2014, para. 17). Maryland is great for house flipping because it had at least 100 single-family homes that had already been flipped within a year’s time span; these flips gave an average investment of 30% for the investors; the county’s unemployment rate was well below the national average, which at the time was 6.7% (March 2014); and the county had an increase in foreclosures during 2014’s first quarter. Furthermore, Maryland’s foreclosure rate was 1 in 64, making it around the 4^th highest. The amount of foreclosed homes in the state may be one reason why house flipping has become so widespread in the last year and why Maryland (along with New Jersey and New York) is the top state to flip houses (Frohlich & Sauter, 2014, para. 3). The state also boasts of high metro areas (due to its proximity to D.C.) and therefore attracts a more business savvy buyer.

References

Frohlich, T. C., & Sauter, M. B. (2014, Feb 2). 6 best states to flip a house. USA Today. Retrieved from http://www.usatoday.com/story/money/business/2014/02/02/6-best-states-to-flip-a-house/5115321/

“14 best places for flipping houses.” Realtor.com (2014, June 13). Retrieved from http://www.realtor.com/news/14-best-places-flipping-houses/