Call it the "Chip and Joanna Gaines effect."
A new report about a national rise in the practice of house flipping — buying an outdated property, renovating it and then selling it for a profit — shows that Dallas-Fort Worth ranked third in 2017 for year-to-year growth in flipping rate, meaning the percentage of flipped houses sold compared to all home sales.
The sale of flipped homes rose by 23 percent in DFW last year, behind only the Buffalo, New York, area and New York/Northern New Jersey, according to the ATTOM Data Solutions 2017 Year-End U.S. Home Flipping Report.
“The 23 percent jump in the home flipping rate in the Dallas-Fort Worth area — one of the highest increases in the country and well above the increase of just 2 percent nationwide — shows that real estate investors continue to be attracted to the dynamic North Texas market with its booming economy and skyrocketing home prices,” said Daren Blomquist, Senior Vice President of ATTOM Data. “Home flippers can ride the coattails of those skyrocketing home prices to often sell their flipped homes at a nice premium given that these flipped homes are often rehabbed to be the most attractive home in a given neighborhood.”
The ATTOM Data report breaks down house flipping data within 50 North Texas zip codes.
For example, the five local zip codes where flips accounted for the highest percentage of overall sales in 2017 were:
1. 76105 – Fort Worth – 20.9 percent
2. 76119 – Fort Worth – 19.5 percent
3. 76106 – Fort Worth – 19.1 percent
4. 75224 – Dallas – 17.8 percent
5. 75233 – Dallas – 15.8 percent
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As for overall house flips, the five most popular zip codes in North Texas last year were:
1. 76179 – Fort Worth – 94
2. 75228 – Dallas – 89 (tie)
2. 76244 – Keller – 89 (tie)
4. 75052 – Grand Prairie – 85
5. 75150 – Mesquite – 76
The five most profitable zip codes to flip a house in North Texas in 2017 were:
1. 75252 – Dallas - $170,543 average gross profit
2. 75230 – Dallas - $158,000
3. 75238 – Dallas - $144,505
4. 75208 – Dallas - $134,117
5. 75069 – McKinney - $123,355
The top five local zip codes where flipped houses sold the fastest in 2017 were:
1. 76120 – Fort Worth – 107 days, on average, from date of original purchase to date of final sale
2. 75134 – Lancaster – 109 days
3. 76039 – Euless – 111 days (tie)
3. 76036 – Crowley – 111 days (tie)
5. 76131 – Fort Worth – 115 days (tie)
5. 76104 – Fort Worth – 115 days (tie)
Roger Lopez, of Value Properties Realty in Dallas, has been flipping houses in North Texas for 35 years. In that time, Lopez estimates that he has flipped between 2,500 and 3,000 homes.
“I have never had as much competition as I do now. It’s crazy,” Lopez said with a laugh, acknowledging that the ATTOM Data Solutions report confirms the trend he has seen in recent years.
Lopez noted that it is not uncommon for 20 to 30 offers to come in these days on the houses he makes bids on.
“This is driving prices up, so the finished product will cost more. But that's the market we're in now,” Lopez said.
At a current job Lopez’s crew is working in a well-established North Oak Cliff neighborhood, the longtime real estate broker and house flipper estimates he will sink about $100,000 into a full remodel of a 1950s-style home.
“That's a lot of money! So if you are thinking about becoming a house flipper make sure you have a lot of money,” Lopez said with a laugh.
