FAST FIVE: The End Is Near: US House Flipping Returns Plunge To 8 Year Low
But push-and-pull forces in the housing market appear to be working less and less in investors' favor.
The $62,700 in 2Q translated into a 39.9% ROI, down from 40.9% ROI in 1Q. Returns on home flips have fallen for six consecutive quarters and eight of the last ten, now reaching levels not seen since 4Q11.
But with returns at eight-year lows, investors, especially the mom-and-pop ones watching too much HGTV, were the ones flipping like crazy in 2Q.
The total dollar volume of financed home flips in 2Q was $8.4 billion, up 31.3% from $6.4 billion in 2Q18, to the highest level since 3Q06.
House flipping returns are plunging at a time when Robert Shiller sat down with Bloomberg earlier this month and dropped a bombshell that might have every flipper wetting their pants: “I wouldn't be surprised if home prices started falling, and it could be accompanied by a recession.” Nobel laureate Robert Shiller said he “wouldn't be at all surprised” if US house prices start to fall https://t.co/tqjfeGfo1l pic.twitter.com/mknbODH4Iq – Bloomberg Economics (@economics) September 5, 2019 Tyler Durden Fri, 09/20/2019 – 23:25 Tags Business Finance Human Interest.