Home Flippers Profiting

CounsellorsTitle.net

September 26, 2019

Title Wise

Title Tips & Tactics for Today's Real Estate Professionals

Home flipping is still attracting buyers, sellers and builders. With nearly a 40% ROI on average, New Jersey is still considered to be a prime market for these types of investments. New Jersey continues to show a slow but steady increase in home prices.

Please feel free to email me at [email protected]

if you have any questions or would like to follow up on any of this edition's articles.

Ralph Aponte

732.914.1400

Home Flippers Still Making Profits

Flipped Homes Increase Over 12 Percent

According to the ATTOM Data Solutions' Q2 2019 U.S. Home Flipping Report, there were 59,876 single family homes that were flipped in Q2 2019, a 12.4% increase from the previous quarter. On a year-to-year basis, it fell by 5.2% from 2018.

New Jersey's Atlantic City housing market shows a 28% year-over-year rise in median home sales price according to the real estate gurus at Trulia. Atlantic City's continuous expansion makes it ideal for flipping houses. The entire state of New Jersey has one of the best returns on investment (ROI) for house flipping, according to GOBankingRates, but Atlantic City is very hot.

But despite home flipping rising in the second quarter, home flippers are seeing on average their return on investment falling due to rising prices in homes flipped, increased costs in materials and shortages of skilled labor.

The report estimates that the homes flipped in Q2 2019 generated a 39.9% return on investment, or an average gross profit of $62,700, which is up 2% from the prior quarter, and down 2% from 2018. This compares with the 40.9% gross flipping ROI in Q1 2019 and 44.4% in Q2 2018. The ROI on flipped homes has fallen six quarters in a row and eight of the last 10. Despite the downward trend, the nearly 40% ROI is still a very compelling and profitable environment within the construction/real estate industry.

The homes flipped in Q2 were sold for a median price of $220,000, which appears to be providing the necessary first-time buyer inventory which is very difficult to find.

According to the report, home flippers have seen double the profits with home flips in five markets, of which three are located in neighboring Pennsylvania: Scranton with 134%; Pittsburgh with 132.5%; and Reading with 129.3%.

The average time it took nationally to flip a home in Q2 2019 was 184 days. The total value of homes flipped with financing totaled $8.4 billion, a 13-year high and equaled 5.9% of all home sales during Q2.

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A.S.A.P. Legal Secretarial Services

Attorney Settlement
Assistance Program

Our real estate secretarial services are able to assist you in every aspect of the sale, purchase, refinance or loan closing process. We will directly communicate with all the parties involved in the transaction and coordinate and obtain all the items necessary to bring the matter to closing.

Our ASAP services can be individually customized to fit your needs. These services include:

Documentation Preparation
Disbursement of Funds
Attendance at Closing
HUD Preparation or
Post-Closing Matters

Home Prices Continue to Scale Higher

Despite what appears to be a slight slowdown, U.S. home prices continue to rise in most regions, excluding those areas where appreciation has been in the double-digits for years.

In New Jersey, we have seen single family home prices rise on average by 4.1% while inventory has fallen by 12.8% year-over-year.

New Jersey has not seen a surge in the price of homes other regions of the country has seen. Morris County has seen home prices increase by 7.1% while Bergen County average price fell by 2.9% from 2018. Salem County posted the biggest gain in the median sales price, skyrocketing by 22.9% to $141,000. But still such gains are atypical for the state.

According to the National Association of Realtors® [NAR], it sees "the median price of existing-home sales will continue increasing, but at a slower pace of 4% in 2019, to $269,000, and 3% in 2020, to $278,500."

According to a January 2019 report from the NAR, home prices in the U.S. rose 47% over the past six years, while wages only rose by 16%. They see U.S. prices will gradually slow to a normal and sustainable pace. The stability of the market could point to a good time to buy a home.

Some of the incentive to buy in the coming months rests upon the fact that mortgage rates are currently resting at historically low levels.

On a historic note, an article published by Pepperdine's Graziadio School of Business and Management cites that the current election cycle may support buying a home in the coming year.

Presidential Elections and Stock Market Cycles, written by Marshall Nickles, found that all of the major stock market declines occurred during the first or second years of the four-year U.S. presidential cycle. No major declines occurred during the third or fourth years. More specifically, from 1950 to 2004 (using the Standard and Poor's 500 Index), the most favorable period (MFP) for investing was from October 1 of the second year of a presidential term to December 31 of the fourth year. [https://bit.ly/2mcE0Xy]

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Our Commitment to Excellence

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Careers @ Counsellors

Sales: Leading NJ title insurance agency seeks experienced licensed salespersons to help expand its market share throughout the entire state. Benefits include health insurance, 401k with an employer match, flexible spending account, expense account, & marketing support. Send resumes by fax: 732-914-8898 or [email protected]

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Free Online Title Insurance Calculator

Counsellors Title Agency announced its updated Title Calculator for New Jersey home purchases & refinances at: Title Calculator

Loan officers, real estate agents and home buyers can find out how

much title insurance will cost for purchases made in New Jersey.

Easy-To-Use Functionality
This online tool includes many of the endorsements involved in calculating the cost of a title policy in New Jersey. CTA's Title Calculator is a great tool for real estate salespersons, loan officers, attorneys and those who are buying or refinancing their home.

It calculates the cost of title insurance based upon the purchase price of the home, the loan amount, and the various endorsements that can accompany the loan. The calculator provides the user the scalability of selecting the various endorsements involved in the transaction.

Counsellors Title Closing Services for Attorneys

Counsellors Title provides its Attorney Settlement Assistance Program [ASAP] with the real estate attorney in mind.

The Counsellors ASAP program offers secretarial services to assist in the process of a sale, purchase, refinance or loan closing.

Counsellors will even communicate directly with all the parties involved in the transaction to coordinate and obtain all the items necessary to assist in the close.

ASAP includes: