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Idaho Statesman

Want to flip houses? Survey ranks two Treasure Valley cities in nation’s top 3

By July 31, 2018 No Comments

With few homes for sale and fast-rising prices, Boise and Nampa have made the top ranks of a new list of the best cities in the nation to flip houses.

Nampa is second and Boise third in rankings of 150 cities compiled by WalletHub, a personal finance website. Sioux Falls, South Dakota, tops the list.

WalletHub seems to like the Treasure Valley. The rankings come three weeks after the site named Nampa the best-run city in America and Boise No. 3.

In the latest ranking, Boise and Nampa benefit from low costs to remodel kitchens and bathrooms. And the cost for a complete home remodeling, $98,176 in both cities, ranks 11th among the cities analyzed.

“Higher renovation and remodeling costs, along with real estate tax rates, would make it more difficult for house flippers to make a reasonable return,” WalletHub analyst Jill Gonzalez said.

Real estate tax rates for both cities were less than 1 percent, WalletHub said.

Flipping means buying a house with the intent of reselling it for a profit, with or without renovations.

WalletHub looked at 172 cities, including at least two cities in each state. Only the top 150 were included in the final list. A year ago, Boise ranked eighth while Nampa didn’t make the list.

Because the latest report’s data are from 2017, it’s unclear whether the climate is quite as attractive today. Prices have soared in 2018.

WalletHub’s analysts listed a median house price paid by flippers of $176,890 in both counties. That ranks 101st.

Most used homes sell for more than that today. Last month, the median price for existing homes sold in Ada County was $299,900, while in Canyon County it was $211,000, both records. However, many homes bought by flippers need renovating.

The availability of used homes has worsened since last year. In Ada County, there were 865 existing homes on the market in June, down from 1,212 a year earlier. In Canyon County, there were 366 used homes for sale, compared with 534 in June 2017, according to the Intermountain Multiple Listing Service.

Touch or hover over a circle on this map to see a city and its rank:

WalletHub evaluated market potential, renovation and remodeling costs and quality of life.

To do that, it drew upon government and commercial housing data and assigned weights to 27 factors, including return on investment, median purchase price, average ratio of sale price to list price, number of days to flip, and share of flipped houses sold to cash buyers.

“Both cities have a high quality of life, the lowest crime rate out of all the cities we analyzed and the lowest unemployment rate,” Gonzalez said.

The number of homes flipped were relatively small in both cities, less than 4 percent of the total homes sold.

Nampa and Boise showed a return of investment of 29 percent, which ranked 135th. The average cost of remodeling a kitchen was $17,579 in Boise (15th) and $16,180 in Nampa (ninth). The average cost to remodel a bathroom was $9,080 in Boise (41st) and $7,183 in Nampa (16th).

Boise and Nampa also benefited from having the lowest share of flipped homes sold to FHA buyers. 2.4 percent. Flippers must wait at least 90 days after buying a home before selling to an FHA buyer. A low share of homes sold to those buyers indicates flippers were able to profit more quickly from their investments, Gonzalez said.

 


Phvntom, Inc. is a digital marketing company located in Boise, Idaho that creates websites, apps, and full-scale promotions/campaigns for other businesses. The views and opinions expressed in this article are strictly those of its authors and were not written by Phvntom. This article was originally published by Idaho Statesman   

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