Median-Priced Homes Remain Unaffordable for Average Wage Earners in 74 Percent of U.S. Housing Markets

Todd Teta

IRVINE, CA, Sept. 26, 2019 — ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), today released its Q3 2019 U.S. Home Affordability Report, which shows that median home prices in the third quarter of 2019 were not affordable for average wage earners in 371 of 498 U.S. counties analyzed in the report (74 percent).

 The largest populated counties where a median-priced home in the third quarter of 2019 was not affordable for average wage earners included Los Angeles County, CA; Cook County (Chicago), IL; Maricopa County (Phoenix), AZ; San Diego County, CA and Orange County, CA. Those same counties were in the top five in Q2 2019.

 The 127 counties (26 percent of the 498 counties analyzed in the report) where a median-priced home in the third quarter of 2019 was still affordable for average wage earners included Harris County (Houston), TX; Wayne County (Detroit), MI; Philadelphia County, PA; Cuyahoga County (Cleveland), OH; and Allegany County (Columbus), OH.

“Buying a home continues to be a rough road to navigate for the average wage earner in the United States," said Todd Teta, chief product officer with ATTOM Data Solutions.

"Prices are going up substantially faster than earnings in 2019 without any immediate end in sight, which continues to make home ownership difficult or impossible for a majority of single-income households and even for many families with two incomes,

“If there is any silver lining to the picture, it’s that mortgage rates have fallen back to historic lows. That’s softening the blow of rising prices and actually making home ownership a bit more attainable in most areas of the country.”

  

Media Contacts:

Christine Stricker

949.748.8428

christine.stricker@attomdata.com

Data and Report Licensing:

949.502.8313

datareports@attomdata.com

           

U.S. Home-Flipping Returns Drop to Nearly Eight-Year Low in Q2 2019

 

Todd Teta

IRVINE, CA –— ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), released its Q2 2019 U.S. Home Flipping Report, which shows that 59,876 U.S. single family homes and condos were flipped in the second quarter of 2019, up 12.4 percent from the previous quarter, but down 5.2 percent from a year ago.

The homes flipped in the second quarter represented 5.9 percent of all home sales during the quarter, down from a post-recession high of 7.2 percent in the previous quarter, but up from 5.4 percent a year ago.

Homes flipped in Q2 2019 typically generated a gross profit of $62,700 (the difference between the median sale price and median paid by investors), up 2 percent from the previous quarter, but down 2 percent from a year ago.

The typical gross flipping profit of $62,700 in Q2 2019 translated into a 39.9 percent return on investment compared to the original acquisition price, down from a 40.9 percent gross flipping ROI in Q1 2019 and from a margin of 44.4 percent in Q2 2018.

Returns on home flips have dropped six quarters in a row and eight of the last 10, now standing at the lowest level since Q4 2011.

“Home flipping keeps getting less and less profitable, which is another marker that the post-recession housing boom is softening or may be coming to an end,” said Todd Teta, chief product officer at ATTOM Data Solutions.

 “Flipping houses is still a good business to be in and profits are healthy in most parts of the country. But push-and-pull forces in the housing market appear to be working less and less in investors’ favor.

"That’s leading to declining profits and a business that is nowhere near as good as it was a few years ago.”

  

Among the areas analyzed, the number of homes flipped reached new peaks in Q2 2019 in 10 MSAs. The largest were Charlotte, NC; San Antonio, TX; Pittsburgh, PA; Oklahoma City, OK and Raleigh, NC.

CONTACT:

Christine Stricker

Sr. Marketing Manager, Projects Office: 949.748.8428 Email: christine.stricker@attomdata.com

Attom Data Solutions Appoints Martha Notaras to Board

  

Martha Notaras

 IRVINE, CA -- ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), is pleased to announce the appointment of Martha Notaras to its Board of Directors, effective immediately.

“We’re delighted to have Martha Notaras join our Board and we look forward to her valuable contributions,” said Rob Barber, CEO, ATTOM Data Solutions.

Rob Barber

 “Martha’s deep professional background and corporate development experience in technology, information and financial service companies, will continue to strengthen our position as the premier one-stop shop for high-quality real estate data and fuel future growth and innovation.”

Steve Ozonian

This announcement comes on the heels of ATTOM most recently being acquired by Lovell Minnick Partners, a private equity firm specializing in financial and related business services companies.

Notaras is a partner at venture capital fund, XL Innovate, investing in insurtech and fintech, including startups focused on data and analytics, as well as new business models. She serves on the boards of four of XL Innovate’s portfolio companies: Cape Analytics, Pillar Technologies, GeoQuant and Notion.

“I am delighted to serve on the ATTOM Data Solutions Board of Directors,” said Notaras. “ATTOM is transforming the future of property data through innovative technology and I look forward to helping power this innovation by guiding strategic initiatives to expand ATTOM's reach into various industries, with a strong focus on insurance-specific solutions.”

John D. Cochran

Previously, Notaras ran corporate development for the business data and analytics division of the Daily Mail and General Trust plc.

Of the 20 investments Notaras made, two achieved and maintained valuations over $1 billion. Notaras has served as board director for companies that are in early and growth stages, with a focus on fintech, insurtech, proptech, edtech and digital media.

Notaras’s prior experience includes investment banking at Merrill Lynch and commercial banking at Credit Suisse.

Jason S. Barg

Notaras earned her A.B. cum laude from Princeton University and her MBA from Harvard Business School, where she was a Baker Scholar, awarded for graduating in the top five percent of the class.

The 2019 ATTOM Data Solutions Board of Directors also consists of Rob Barber, CEO, ATTOM Data Solutions; Steve Ozonian, CEO of Williston Financial Group and Lead Director of LendingTree; John D. Cochran, Partner of Lovell Minnick and a member of its Investment Committee and its Management Committee; and Jason S. Barg, Partner of Lovell Minnick.

CONTACTS:

Christine Stricker

949.748.8428

christine.stricker@attomdata.com

Data and Report Licensing:

949.502.8313

datareports@attomdata.com

 

ATTOM Data Solutions Finds Median-Priced Homes Not Affordable for Average Wage Earners in 74 Percent of U.S. Housing Markets; Home Prices Outpacing Wages in 40 percent of Locations

Todd Teta

IRVINE, CA — ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS released its Q2 2019 U.S. Home Affordability Report, which shows that median home prices in the second quarter of 2019 were not affordable for average wage earners in 353 of 480 U.S. counties analyzed in the report (74 percent).

The largest populated counties where a median-priced home in the second quarter of 2019 was not affordable for average wage earners included Los Angeles County, California; Cook County (Chicago), Illinois; Maricopa County (Phoenix), Arizona; San Diego County, California; and Orange County, California.

The 127 counties (26 percent of the 480 counties analyzed in the report) where a median-priced home in the second quarter of 2019 was still affordable for average wage earners included Harris County (Houston), Texas; Wayne County (Detroit), Michigan; Philadelphia County, Pennsylvania; Cuyahoga County (Cleveland), Ohio; and Franklin County (Columbus), Ohio.

The report determined affordability for average wage earners by calculating the amount of income needed to make monthly house payments — including mortgage, property taxes and insurance — on a median-priced home, assuming a 3 percent down payment and a 28 percent maximum “front-end” debt-to-income ratio.

 That required income was then compared to annualized average weekly wage data from the Bureau of Labor Statistics (see full methodology below).

“Despite falling mortgage rates and rising wages, the cost of owning the typical home remains out of reach or a significant financial stretch for the nation’s average wage earners,” said Todd Teta, chief product office with ATTOM Data Solutions.

“However, a closer look at the data reveals milder-than-usual increases for the Spring, and none as severe as in previous years since the recession. Therefore, this can help indicate the market may be easing, following similar indicators from recent home-flipping and foreclosure data trends.”

Home price appreciation outpacing wage growth in 40 percent of markets

Home price appreciation outpaced average weekly wage growth in 192 of the 480 counties analyzed in the report (40 percent), including Maricopa County (Phoenix), Arizona; Riverside County, California;

San Bernardino County (Riverside), California; Tarrant County (Dallas-Fort Worth), Texas; and Wayne County (Detroit), Michigan.

Average weekly wage growth outpaced home price appreciation in 288 of the 480 counties analyzed in the report (60 percent), including Miami County, Florida; Kings County, New York; Dallas County, Texas; Queens County, New York; and Clark County, New York.

67 percent of markets require over 30 percent of wages to buy a home

Among the 480 counties analyzed in the report, 323 (67 percent) require at least 30 percent of their annualized weekly wages to buy a home in the second quarter of 2019.

Those counties that required the greatest percent included Marin County (San Francisco), California (116.8 percent of annualized weekly wages needed to buy a home); Kings County, New York (113.4 percent); Santa Cruz County, California (112.3 percent); San Luis Obispo County, California (91.4 percent); and Maui County, Hawaii (88.2 percent).

A total of 157 of the 480 counties analyzed in the report (33 percent) required less than 30 percent of their annualized weekly wages to buy a home in the second quarter of 2019.

Those counties that required the smallest percent included Bibb County (Macon), Georgia (12.9 percent of annualized weekly wages needed to buy a home); Wayne County (Detroit), Michigan (13.2 percent); Baltimore City, Maryland (13.6 percent); Rock Island County (Davenport), Illinois (14.9 percent); and Allen County (Lima), Ohio (14.9 percent).

61 percent of markets less affordable than historic averages

Among the 480 counties analyzed in the report, 292 (61 percent) were less affordable than their historic affordability averages in the second quarter of 2019, up from 50 percent of counties in the previous quarter but down from 74 percent of counties in the second quarter of 2018.

Counties that were less affordable than their historic affordability averages included Los Angeles County, California; Harris County (Houston), Texas; Maricopa County (Phoenix), Arizona; San Diego County, California; and Orange County, California.

39 percent of markets more affordable than historic averages

Among the 480 counties analyzed in the report, 188 (39 percent) were more affordable than their historic affordability averages in the second quarter of 2019, including Cook County (Chicago), Illinois; and New York County, Suffolk County, Bronx and Nassau County – all in the New York metro area.

Counties with the highest affordability index were Warren County (Allentown), New Jersey (158); Litchfield (Torrington), Connecticut (139); Cumberland (Vineland), New Jersey (139); Mercer County (Trenton), New Jersey (137); and Atlantic County (Atlantic City), New Jersey (134).

82 percent of markets post better affordability compared to year ago

A total of 393 of the 480 counties analyzed in the report (82 percent) posted a year-over-year increase in the affordability index, meaning that home prices were more affordable than a year ago, including Los Angeles County, California; Cook County (Chicago), Illinois; Harris County (Houston), Texas; Maricopa County (Phoenix), Arizona; and San Diego County, California.

A total of 87 of the 480 counties analyzed in the report (18 percent) posted a year-over-year decrease in their affordability index, meaning that home prices were less affordable than a year ago, including Sale Lake County, Utah; Saint Louis County, Missouri; Marion County (Indianapolis), Indiana; Middlesex County, New Jersey; and Jackson County (Kansas City), Missouri.

CONTACTS:

Christine Stricker

949.748.8428

christine.stricker@attomdata.com

Data and Report Licensing:

949.502.8313

datareports@attomdata.com

U.S. Home Flipping Rate Reaches Nine-Year High in First Quarter 2019

Todd Teta

IRVINE, CA— ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), released its Q1 2019 U.S. Home Flipping Report, which shows that 49,059 U.S. single family homes and condos were flipped in the first quarter of 2019, down 2 percent from the previous quarter and down 8 percent from a year ago to a three-year low.

The 49,059 homes flipped in the first quarter represented 7.2 percent of all home sales during the quarter, up from 5.9 percent in the previous quarter and up from 6.7 percent a year ago — the highest home flipping rate since Q1 2010.

Homes flipped in Q1 2019 sold at an average gross profit of $60,000, down from an average gross flipping profit of $62,000 in the previous quarter and down from $68,000 in Q1 2018 to the lowest average gross flipping profit since Q1 2016.

The average gross flipping profit of $60,000 in Q1 2019 translated into an average 38.7 percent return on investment compared to the original acquisition price, down from a 42.5 percent average gross flipping ROI in Q4 2018 and down from an average gross flipping ROI of 48.6 percent in Q1 2018 to the lowest level since Q3 2011 — a nearly eight-year low.

“With interest rates dropping and home price increases starting to ease, investors may be getting out while the getting is good, before the market softens further,” said Todd Teta, chief product officer at ATTOM Data Solutions. 

“While the home flipping rate is increasing, gross profits and ROI are starting to weaken and the number of investors that are flipping is down 11 percent from last year. 

"Therefore, if investors are seeing profit margins drop, they may be acting now and selling before price increases drop even more.”

Home flipping rate up from year ago in 62 percent of local markets

Eighty-five of 138 metropolitan statistical analyzed in the report (62 percent) posted a year-over-year increase in their home flipping rate in Q1 2019, including Columbus, Georgia (up 83 percent); Raleigh, North Carolina (up 73 percent); Charlotte, North Carolina (up 65 percent); McAllen-Edinburg, Texas (up 55 percent); and Milwaukee, Wisconsin (up 49 percent).

 

Along with Raleigh, Charlotte, and Milwaukee, other metro areas with a population of at least 1 million and a home flipping rate increasing in the double digits were San Antonio, Texas (up 47 percent); Houston, Texas (up 41 percent); Atlanta, Georgia (up 38 percent); Pittsburgh, Pennsylvania (up 36 percent); and Minneapolis, Minnesota (up 33 percent).

The number of homes flipped reached new peaks in Q1 2019 for Raleigh, North Carolina and San Antonio, Texas in the first quarter of 2019.

Home flip lending volume up 35 percent to 12-year high

The total dollar volume of financed home flip purchases was $6.4 billion for homes flipped in the first quarter of 2019, up 35 percent from $4.7 billion in Q1 2018 to the highest level since Q2 2007 — over a 12-year high. 

Flipped homes originally purchased by the investor with financing represented 37.5 percent of homes flipped in Q1 2019, down from 39.5 percent in the previous quarter and down from 41.2 percent a year ago.

 

Among 53 metropolitan statistical areas analyzed in the report with at least 1 million people, those with the highest percentage of Q1 2019 completed flips purchased with financing were San Diego, California (56.0 percent); Seattle, Washington (52.5 percent); San Francisco, California (51.7 percent); Denver, Colorado (51.6 percent); and Boston, Massachusetts (51.3 percent).

11 Markets where investors are doubling their ROI

Among the 138 metropolitan statistical areas analyzed in the report with at least 50 home flips completed in Q1 2019, those with the highest average gross flipping ROI were Pittsburgh, Pennsylvania (131.2 percent); Flint, Michigan (127.6 percent); Shreveport, Louisiana (112.5 percent); Scranton, Pennsylvania (112.0 percent); and Knoxville, Tennessee (105.0 percent).

 Along with Pittsburgh, Pennsylvania metro areas with a population of at least 1 million and an average gross flipping ROI of at least 79 percent were Cleveland, Ohio (100.0 percent); Philadelphia, Pennsylvania (100.0 percent); Buffalo, New York (89.7 percent); and Memphis, Tennessee (79.2 percent).

 Average home flipping returns continue to slip

Homes flipped in the first quarter of 2019 were sold for a median price of $215,000, a gross flipping profit of $60,000 above the median purchase price of $155,000, down from a gross flipping profit of $62,000 in the previous quarter and a gross flipping profit of $68,000 in Q1 2018 — to the lowest levels since Q1 2016.

Of those 138 markets with at least 50 or more flips and a population greater than 200,000 in the first quarter of 2019, those that saw the lowest gross flipping profit were McAllen-Edinburg, Texas (profit of $8,752); Daphne, Alabama (profit of $15,761); Boise City, Idaho (profit of $18,332); Lexington, Kentucky (profit of $20,000); and San Antonio, Texas (profit of $23,596).

Average time to flip nationwide at 180 days

Homes flipped in Q1 2019 took an average of 180 days to complete the flip, up from an average 175 days for homes flipped in Q4 2018 but down from 182 days a year ago.

 

Among the 138 metro areas analyzed in the report, those with the shortest average days to flip were McAllen-Edinburg, Texas (127 days); Memphis, Tennessee (136 days); Raleigh, North Carolina (142 days); Mobile, Alabama (144 days); and Phoenix, Arizona (151 days).

 

Metro areas with the longest average days to flip were Naples, Florida (235 days); Bridgeport, Connecticut (230 days); New Haven, Connecticut (225 days); Provo, Utah (219 days); and Hartford, Connecticut (219 days).

 

Flipped homes sold to FHA buyers increases from previous quarter

Of the 49,059 U.S. homes flipped in Q1 2019, 14.2 percent were sold by the flipper to a buyer using a loan backed by the Federal Housing Administration (FHA), up from 13.2 percent in the previous quarter but down from 15.2 percent a year ago.

Among the 138 metro areas analyzed in the report, those with the highest percentage of Q1 2019 home flips sold to FHA buyers — typically first-time homebuyers — were Worcester, Massachusetts (30.0 percent); Shreveport, Louisiana (29.0 percent); Modesto, California (27.3 percent); Hartford, Connecticut (27.2 percent); and Springfield, Massachusetts (27.0 percent).

Eight zip codes with a home flipping rate of more than 30 percent

Among 1,433 U.S. zip codes with at least 10 home flips in Q1 2019, there were eight zip codes where home flips accounted for more than 30 percent of all home sales, here are the top five: 93212 in Kings county, California (48.0 percent); 11433 in Queens county, New York (35.7 percent); 33147 Miami-Dade county, Florida (32.7 percent); 38115 in Shelby county, Tennessee (32.4 percent); and 92802 in Orange county, California (32.1 percent).

  CONTACTS:

Jennifer von Pohlmann

949.412.3897

Jennifer,vonpohlmann@attomdata.com

 

Data and Report Licensing:

949.502.8313

datareports@attomdata.com

U.S. Average Homeownership Tenure Dips to 8.05 Years and Posts Biggest Annual Increase Since Q4 2015

 Denver, Austin, Dallas and Nashville Sales Prices 50+ Percent Above Pre-Recession Peaks

Todd Teta

IRVINE, CA –— ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS),  released its Q1 2019 U.S. Home Sales Report, which shows that homeowners who sold in the first quarter realized an average price gain of $57,500 since purchase, representing an average 31.5 percent return on the purchase price.

Meanwhile, the report also shows that homeowners who sold in the first quarter had owned an average of 8.05 years, down slightly from a record-high average homeownership tenure of 8.17 years in Q4 2018 but still up from 7.75 years in Q1 2018.

 Homeownership tenure averaged 4.21 years nationwide between Q1 2000 and Q3 2007, prior to the Great Recession.

“We are starting to see homes sales prices and profit margins softening for the nation, and the average homeownership tenure did see a slight dip from last quarter,” said Todd Teta, chief product officer at ATTOM Data Solutions.

“However, home prices are still above pre-recession peaks in 59 percent of local markets, and as the buying season starts to kick into gear, the next few months may provide even more answers to the question of whether a lasso is indeed around the market or if the recent trend is a temporary bump in the ride.”

CONTACTS:

Christine Stricker

949.748.8428

christine.stricker@attomdata.com

Data and Report Licensing:

949.502.8313

datareports@attomdata.com