WINSTON-SALEM, N.C. (WGHP) – Metro Winston-Salem was one of the most active markets in the country for home flipping (buying a home, renovating it and selling it quickly) in the third quarter of this year, according to a new report.
Resales accounted for 12.7% of all home and condo sales in the three months ended Sept. 30, ranking Winston-Salem fourth, according to ATTOM, a California real estate data collection company.
Among metro areas with populations of 200,000 or more that saw 50 resales during the quarter, only Phoenix (13.7%), Spartanburg, South Carolina (13.3%) and Atlanta (12.9%) were more active than Winston-Salem. Gainesville, Georgia (12.6%) ranked fifth.
ATTOM reported that 92,422 single-family homes and condominiums were resold in the third quarter, accounting for about 7.5% of all sales. This is down from 8.2% in the second quarter and a record 9.7% in the first quarter, but up from 5.9% in the third quarter of 2021.
Home resales remain thriving in many parts of North Carolina. (AP Photo/Matt Rourke, File)
Statewide, 9.2% of home sales were resale-related, down 7% from the previous quarter but up 15% from last year.
There were 4,457 resales statewide in the third quarter, with an average sales price of $300,000 and a profit margin of $60,000, or 25% of the purchase price.
It takes about 159 days, or five to six months, to flip a home, four days shorter than the national average but about three weeks longer than a year ago.
“This is a classic good news/bad news report for remodel and resale investors,” Rick Sharga, executive vice president of market intelligence at ATTOM, said in the report. “While resale activity reached an all-time high in the third quarter, gross profits and profit margins declined significantly, reflecting overall pricing weakness in today's housing market.”
Making Money
ATTOM reported that gross profits from these property resales hit their lowest level in nearly three years in the third quarter, the fastest quarterly pace since 2009 and the lowest level in 13 years.
Average gross profit (calculated as the difference between the median price paid and the median sale price) was $62,000, 18.4% lower than in the second quarter ($76,000) and 11.4% lower than a year ago ($70,000).
According to ATTOM, the national resale price of existing homes in the third quarter of 2022 was $310,000, down 5.5% from the second quarter but up 6.9% from the same period last year ($290,000).
That was driven by the difference between buying and selling price movements. But North Carolina and the Piedmont Triad performed much better than the national average.
Triads and NC
ATTOM measures only counties that reported 10 or more resales in the third quarter, so eight of the Triad's 14 counties and 61 or 100 counties statewide are included in the assessment.
Of the 4,300 resales that took place across 61 counties in the third quarter, Gaston County recorded a state-high 16% of all sales. In the Triad counties, eight counties saw 859 resales, while Davidson County saw 14% of sales being resales, higher than Forsyth County's 13.6%.
Davidson County was down 2% from last quarter but up 71% from last year. All counties saw increases over last year, but only Alamance, Forsyth and Surry counties improved from last quarter.
Guilford County saw 296 resales and Forsyth County saw 280 resales, up 12% from a year ago but down 7% from the second quarter.
Alamance County had the highest gross profit from resales in the second quarter ($96,455), but Rockingham County had the highest gross profit margin (127.5%) with an average purchase price of $52,753 and an average resale price of $120,000 for the 31 resale properties.
Davie County saw a 51% drop in resales and had the shortest quarterly average collection period of 123 days, but it was still nearly 50% longer than a year ago. Only Guilford County had a collection period approaching the same level as 2021 (up four days to 137 days).
Statewide, Martin County saw the highest quarterly increase in resales (63 percent, up 318 percent from last year), while Davie County saw the largest decrease (51 percent). Watauga County saw the largest year-over-year decrease (27 percent).
The state's average profit was $79,921, down about 12.5% from a year ago, with Dare County seeing the highest average profit ($224,500 compared to a median sales price of $734,500) and Columbus County seeing an average loss of $5,000.
Compare that to Triad, where the average profit was $67,978, up about 25% from last year.
National trends
Of the 194 metropolitan statistical areas analyzed by ATTOM across the U.S., 132 saw declines in resale rates, most of which were by less than 2 percent.
Excluding Phoenix and Atlanta, the highest resale rates among metro areas with populations of 1 million or more were Memphis (12.1%), Jacksonville, Fla. (11.8%) and Tucson (11.4%). The lowest resale rates were in Honolulu (1.6%), Davenport, Iowa (3.7%), Rochester, New York, Ann Arbor, Michigan and Bridgeport, Connecticut (4% each).