Home Flipping
RealtyTrac released a report earlier this month showing the hottest zip codes for flipping homes in the Charlotte area. They defined flipping as one property sold twice within a 12 month period. There was no surprise that 28205 was the hottest zipcode as it includes Belmont, Plaza Midwood, NoDa, Country Club Heights, Plaza-Shamrock, and Echo Hills. These neighborhoods have lots of unique homes, lots of history, and are popular with young families, millennials, older couples looking to downsize and more.
There were many other zip codes popular with flippers including:
- 28205 – 138 flips
- 28215 – 83
- 28269 – 82
- 28216 – 78
- 28214 – 73
- 28208 – 65
- 28025 – 64
- 28277 – 64
- 28210 – 60
- 29027 – 55
What is surprising however, is that the zip codes with the highest gross flipping profits were not the ones on the list with most flips. There are four zip codes where gross flipping profits surpassed $100,000. Gross flipping profits are calculated by taking the difference between the two sales prices of the home within the 12 month period. These gross numbers do not necessarily reflect profit made on the sale of the home as you have to take into account carrying costs of the property such as mortgage, taxes, insurance and utilities. Also not included in this number is any costs associated with remodeling or upgrading the home between sales. Fees for the sale of the home such as staging and Realtor fees are also not included in the gross calculation.
The zip codes with the highest gross profits are:
- 28204 – $154,500 – Cherry and Elizabeth neighborhoods
- 28203 – $137,500 – Dilworth, Wilmore, Brookhill
- 28209 – $131,000 – Myers Park, Barclay Downs, Colonial Village, Madison Park
- 28211 – $107,750 – Cotswold, Barclay Downs, Foxcroft, Myers Park
Listings
According to Zillow, the best time to list a home in the Charlotte area is between May first and May fifteenth. They looked at trends for the past 8 years to narrow down the date range. Homes listed between these dates sold for an average of 12 days faster and for an average of 1.1% more money or $1,700. Their conclusion was that homebuyers that started looking for homes in the early spring may be anxious if they haven’t found their dream home months later, especially as we have a lack of supply in Charlotte right now. These anxious buyers may be more willing to pay a premium to close the deal before the summer starts.
Interest Rates
Meanwhile, the fed just raised interest rates and has hinted at two more rate hikes this year. While buyers may not feel much due to this interest rate hike of just one-quarter percentage point, if there are two additional hikes this year, buyers may start feeling the pinch, especially if they have ARMs (adjustable rate mortgages) or HELOCs (home equity lines of credit).
Homeowners with HELOCs should start feeling the increase in the next three weeks or so. ARMs will typically only see an increase in rate once per year, but they could potentially see all three increases at once.
30 year mortgage rates have climbed up over 4.5% over last year’s high of 3.6% (per USA Today). These rates are on the rise so now may be the best time to lock in a low rate.
If you are interested buying or investing in a home in the Charlotte area, give us a call at (704) 525-4045. You can also view listings on our website here.