Utah and Tennessee establish themselves as the best places to flip houses in terms of low remodeling costs. New Hampshire meanwhile has the lowest rental vacancy rate. West Virginia boasts the highest homeownership rate in the US and the lowest housing costs.
House flipping isn’t dead. While the profits have been dropping for the past eight years, American house flippers can still earn hefty sums. For successful projects, however, you must know the best places to flip houses in the United States.
What to look for when choosing where to invest? What are the criteria that can help you make smart decisions? Where should you start your house flipping journey? Learn all about flipping houses in the US in this comprehensive guide. Not only will we analyze each state’s house flipping potential, but we will also teach you the basics of how to recognize favorable markets.
How We Determine the Best Markets for Flipping Houses
Knowing how to analyze the house flipping market is crucial for those who want to profit from this activity. Below, you can find the criteria we use to determine the best and the worst markets for flipping houses.
Homeownership rate – This rate shows how many households own their homes as opposed to renting. House flipping makes sense in communities where families have the purchasing power to invest in their homes. States with low ownership rates, however, attract residents who prefer renting. Meaning, the chance of making a living flipping houses there is low.
– This rate shows how many households own their homes as opposed to renting. House flipping makes sense in communities where families have the purchasing power to invest in their homes. States with low ownership rates, however, attract residents who prefer renting. Meaning, the chance of making a living flipping houses there is low. Median household income – This is another vital criterion that defines the purchasing power of families in a specific region. The more money households make in a given state, the higher the chances for you to sell houses to them. So, the best places to flip homes are those with higher median household incomes.
– This is another vital criterion that defines the purchasing power of families in a specific region. The more money households make in a given state, the higher the chances for you to sell houses to them. So, the best places to flip homes are those with higher median household incomes. Home value – Flipping properties can generate more profit in markets where the average home price is high. We prefer, therefore, states where homes are worth more. Plus, a high average market value signals that the demand in that state is high. This also improves your chances of selling a house there.
– Flipping properties can generate more profit in markets where the average home price is high. We prefer, therefore, states where homes are worth more. Plus, a high average market value signals that the demand in that state is high. This also improves your chances of selling a house there. Median monthly housing costs – The importance of median housing costs per month is two-fold. First, families prefer investing somewhere where the housing costs aren’t soaring. It’s a logical financial decision. The best cities to flip houses, therefore, have low housing costs. Second, it affects your costs while flipping the house. Most properties stay on the market for at least 70 days, during which you pay such expenses.
– The importance of median housing costs per month is two-fold. First, families prefer investing somewhere where the housing costs aren’t soaring. It’s a logical financial decision. The best cities to flip houses, therefore, have low housing costs. Second, it affects your costs while flipping the house. Most properties stay on the market for at least 70 days, during which you pay such expenses. Average full home remodeling costs – This is essential information for house flippers. You don’t want to spend thousands of dollars on remodeling, especially not in markets with a low average sale price. To earn a reasonable flipping houses salary, you need to fix properties for a reasonable cost.
– This is essential information for house flippers. You don’t want to spend thousands of dollars on remodeling, especially not in markets with a low average sale price. To earn a reasonable flipping houses salary, you need to fix properties for a reasonable cost. Number of realtors – The best places to flip houses have an active real estate market. States with more realtors have better chances of selling properties fast. If there are only a few realtors, that’s a sign that the market isn’t attractive there.
– The best places to flip houses have an active real estate market. States with more realtors have better chances of selling properties fast. If there are only a few realtors, that’s a sign that the market isn’t attractive there. Average listing and sell price – Another key criterion that shows your flipping houses profit potential. The average listing price reveals how much money sellers expect for their properties. The average sell price, by contrast, shows the actual situation and how much homes sell for. The best markets for house flipping have a reasonable ratio of average listing and average sell price.
– Another key criterion that shows your flipping houses profit potential. The average listing price reveals how much money sellers expect for their properties. The average sell price, by contrast, shows the actual situation and how much homes sell for. The best markets for house flipping have a reasonable ratio of average listing and average sell price. Average time to sell – The longer our property remains on the market, the more money you lose. We give better rankings to states where new listings get sold faster. Flipping houses in Vermont, for instance, usually comes with a turnover time of 96 days. Flipping houses in Virginia, in contrast, is much shorter at 73 days. The latter, understandably, will rank better on our list of the best markets for flipping houses.
Best and Worst Markets for Flipping Properties
With so many ranking factors, it’s impossible to highlight one place as the best destination for making money flipping houses. That’s why we summarized all the vital data in two separate tables. The first covers the general factors, while the second focuses on specific criteria.
Overview of General House Flipping Rankings
In the table below, we focus on general data like homeownership rate, median income, housing costs, and remodeling costs. These give you information critical to finding the best areas to flip houses. Yet, they are not as specific as the factors covered in the following section.
These are the highlights that can help you understand where it’s possible to flip cheap houses.
Homeownership rate in 2021
Top five – West Virginia (73.4%), Maine (72.2), Wyoming (71.9%), Minnesota (71.9%), Michigan (71.6%)
Worst five – D.C. (42.5%), New York (53.5%), California (54.9%), Nevada (56.6%), Hawaii (60.2%)
Median household income
Top five – D.C. ($90,842), Maryland ($86,738), Massachusetts ($85,843), New Jersey ($85,751), Hawaii ($83,102)
Worst five – Mississippi ($45,752), West Virginia ($48,850), Arkansas ($48,952), Louisiana ($51,073), Alabama ($51,734)
Median household costs per month
Top five – West Virginia ($1,052), Arkansas ($1,094), Indiana ($1,146), Mississippi ($1,149), Alabama ($1,172)
Worst five – D.C. ($2,676), Hawaii ($2,472), California ($2,421), New Jersey ($2,413), Massachusetts ($2,276)
Average remodeling costs
Top five – Arkansas ($75,888), Tennessee ($82,928), Utah ($83,014), Iowa ($85,478), Idaho ($98,176)
Worst five – Massachusetts ($323,311), Oregon ($311,185), New York ($289,719), Connecticut ($278,469), Rhode Island ($275,515)
Lowest remodeling costs
Top five – Utah ($12,000), Missouri ($14,000), Kentucky ($15,000), Tennessee ($16,000), Iowa ($16,000)
Worst five – California ($48,000), Oregon ($47,000), Connecticut ($46,000), Massachusetts ($44,000), Alaska ($41,000)
Rental vacancy rate
Top five – New Jersey (2.5%), Vermont (2.7%), Utah (3.2%), Oregon (3.3%), Massachusetts (3.4%)
Worst five – North Dakota (12.8%), Alabama (12%), Mississippi (10.7%), Indiana (9.7%), Oklahoma (9.5%)
What kills weeds down to the root?
White Vinegar: For it to work, you have to wait for the vinegar to sit in the weeds from your garden for a few days. The vinegar will kill the...
Utah and Missouri establish themselves as the best places to flip houses in terms of low remodeling costs. New Jersey, meanwhile, has the lowest rental vacancy rate. West Virginia boasts the highest homeownership rate in the US and the lowest housing costs. Families in the District of Columbia, Massachusetts, and Maryland, however, have the strongest purchasing power.
Flipping houses in Hawaii doesn’t make sense, at least not without a considerable investment. The state, while an attractive destination, has high housing costs. Plus, its homeownership rate is only 60.2%. So, it doesn’t belong among the best states to flip houses.
(Stewart, Census, Houzz, World Population Review, Census)
Overview of Specific House Flipping Rankings
Now, let’s see how each state is doing in terms of median home value. We will also analyze the average prices of listings and sold homes as well as the average turnover time. This table dives deeper into the best states to flip houses and what makes them a suitable choice.
Here are the highlights you should keep in mind.
Median home value
Top five – Hawaii ($669,200), D.C. ($618,100), California ($568,200), Massachusetts ($418,600), Colorado ($394,600)
Worst five – West Virginia ($124,600), Mississippi ($128,200), Arkansas ($136,200), Oklahoma ($147,000), Kentucky ($154,700)
Average listing price
Top five – California ($758,755), Hawaii ($691,586), Massachusetts ($644,536), Utah ($590,049), New York ($583,882)
West Virginia ($171,177), Kansas (207,373), Ohio ($208,283), Arkansas ($216,417), Iowa ($223,096)
Average sell price
Top five – Hawaii ($865,500), California ($725,500), Massachusetts ($670,000), Washington ($629,993), Montana (629,950)
Worst five – West Virginia ($218,575), Ohio ($225,000), Michigan ($251,627), Indiana ($271,200), Mississippi ($274,950)
Average days on the market
Top five – Tennessee (68), New Hampshire (68), Washington (68), Nevada (69), Arizona (69)
Worst five – Wyoming (104), New York (101), Montana (100), Vermont (96), West Virginia (96)
Number of realtors
Top five – Arizona (168), Hawaii (173), Florida (175), D.C. (193), Nevada (200)
Worst five – West Virginia (677), Mississippi (628), South Dakota (534), Alaska (533), Kentucky (508)
While Hawaii was hardly among the best states to flip houses based on the previous factors, here it’s in the top destinations for finding properties to flip. Hawaii has one realtor per 173 people, which is excellent. The state also has a high listing and selling price and soaring average home value.
Washington is an excellent destination for finding houses to flip when it comes to expected house value change and turnover time. D.C. is another obvious pick, with its average time on the market of only 77 days. Massachusetts is another state not to overlook, as it’s in the top five destinations in several categories.
Florida outperforms most states by the number of realtors, while its other rankings are average. If you want to invest in this state, Tampa is among the best places to flip houses in Florida.
State Median Home Value in USD Average listing price in USD Average sale price in USD Average time to sell in days 1 Realtor Per How many People Alabama 154,000 271,171 319,450 79 441 Alaska 281,200 331,559 399,700 85 533 Arizona 255,900 441,251 477,500 69 168 Arkansas 136,200 216,417 275,000 84 447 California 568,500 758,755 725,000 71 241 Colorado 394,600 568,012 600,000 71 257 Connecticut 280,700 439,532 475,000 77 229 D.C. 618,100 579,005 621,250 77 193 Delaware 261,700 381,200 466,925 88 366 Florida 245,100 380,382 465,000 78 175 Georgia 202,500 357,145 394,900 75 432 Hawaii 669,200 691,586 865,500 86 173 Idaho 255,200 524,923 549,900 75 267 Illinois 209,100 253,318 299,000 79 319 Indiana 156,000 227,304 271,200 72 445 Iowa 158,900 223,096 279,500 87 491 Kansas 163,200 207,373 280,595 85 385 Kentucky 151,700 243,086 282,500 83 508 Louisiana 172,100 268,909 284,950 95 441 Maine 200,500 326,264 387,000 87 334 Maryland 332,500 N/A 399,950 73 282 Massachusetts 418,600 644,536 670,000 69 350 Michigan 169,600 251,627 269,900 76 460 Minnesota 246,700 318,350 373,500 74 329 Mississippi 128,200 231,063 274,950 85 628 Missouri 168,000 243,922 280,975 81 322 Montana 253,600 477,295 629,950 100 290 Nebraska 172,700 261,592 327,450 79 478 Nevada 317,800 410,281 475,000 69 200 New Hampshire 281,400 418,195 499,450 68 268 New Jersey 348,800 443,933 479,950 76 201 New Mexico 180,900 295,535 373,768 92 375 New York 338,700 583,882 582,450 101 409 North Carolina 193,200 359,532 410,000 75 308 North Dakota 205,400 254,922 289,900 92 486 Ohio 157,200 208,283 225,000 74 433 Oklahoma 147,000 229,200 281,669 82 456 Oregon 354,600 509,970 549,995 78 307 Pennsylvania 192,600 271,362 280,000 84 465 Rhode Island 283,000 417,550 481,975 70 275 South Carolina 179,800 307,848 355,257 75 350 South Dakota 185,000 267,856 350,000 78 534 Tennessee 191,900 343,458 425,000 68 337 Texas 200,400 332,593 389,945 76 340 Utah 330,300 590,049 579,500 69 265 Vermont 233,200 351,082 443,000 96 378 Virginia 288,800 369,607 425,000 73 295 Washington 387,600 563,486 629,993 68 448 West Virginia 124,600 171,177 218,575 96 677 Wisconsin 197,200 277,017 349,900 83 457 Wyoming 235,200 302,114 430,000 104 313
(Stewart, Census, Zillow, ListWithClever, The American Genius)
Best Cities to Flip Homes in the United States
In the tables above, we analyzed the states and their rankings in all the relevant categories. Here, let us list the ultimate city leaders in the house flipping market.
West Valley City, Utah
Can I put my shed against my fence?
In order to avoid potential buildup of mold, mildew, and rot growth, it is advised that you should leave space between a fence and a shed. This...
Flipping houses in Utah can earn you an excellent salary as a house flipper. This state topped our list of best destinations thanks to a short turnover time, high homeownership rate, and low remodeling costs. On average, house flippers spend about $83,000 to remodel a house in Utah, while the lowest expenses move around $12,000. West Valley City stands out among the best cities to flip houses in this state.
Greensboro, North Carolina
With a median home value of $193,200, North Carolina is another house flipping destination for those ready to invest under $200,000. House flippers can remodel homes in this state for a minimum of $21,000, which is a solid amount. Homes in the state sell in two and a half months, which isn’t the best, but the housing costs are a reasonable $1,318 or so.
With a growing real estate market, Greensboro is among the best places to flip houses in North Carolina. This destination offers a solid quality of life, and it’s the largest economy in the state. Meaning, those who move there can expect high-paying jobs. That’s why Greensboro is a top spot for those who want to try our flipping houses in North Carolina.
Pittsburgh, Pennsylvania
Pennsylvania has an average ranking in most categories, but that doesn’t mean you should overlook it. The city’s average ROI of flipping houses is an impressive 162.4%. Selling takes about 84 days, and the cheapest remodeling costs about $20,000. All these figures make the destination a smart choice.
Pittsburgh and Philadelphia are the best places to flip houses in Pennsylvania. The latter is the obvious choice, being a popular city in general. Pittsburgh, however, allows you to find cheap properties and make hefty earnings. Making money flipping houses isn’t about investing in popular and expensive markets. It’s about finding growing markets and properties with high potential. Pittsburgh fits that description perfectly.
New Orleans, Louisiana
While flipping houses in Louisiana may not be the obvious choice, the state is a place of opportunity. New Orleans is among the best cities to flip houses in Louisiana, as its market significantly improved after Katrina. It remains the most populated place in the state. The average ROI in Louisiana is 104.2%, and you can give a house a makeover for a minimum of $26,000. With a median home value of nearly $172,100, this is the right place for a house flipper with an investment of that size.
Denver, Colorado
If you’re looking for the best places to flip houses in Colorado, consider investing in Denver. The average ROI in this city is 155.6%, thanks to the many tech companies that operate from there. Colorado ranks excellent in most categories and only underperforms when it comes to remodeling prices. Still, it’s possible to find great house flipping properties and sell them within two and a half months.
Boston, Massachusetts
Boston is one of the best places to flip houses in Massachusetts and the US. The Bay State is an excellent destination in various aspects. Properties there have significant value, and the rental vacancy rate is low. Homes in the state further sell pretty fast. Massachusetts ranked 4th in the average turnover time category. Just make sure not to overlook the high remodeling and housing costs in the state. These prevent you from finding properties to flip without a significant starting investment.
San Diego, California
San Diego is one of the best cities to flip houses in California, with its year-over-year increase in gross profit of 8.7%. California ranked 8th for the number of realtors and 2nd for the average sell price. For flipping houses in California, however, you will need a hefty starting investment and at least $48,000 for remodeling.
Memphis, Tennessee
Even though it’s toward the bottom of our list, Tennessee is another top spot for making a nice house flipping salary. The reason? You only need about $16,000 to remodel a home. When it comes to the best places to flip houses in Tennessee, the crown goes to Memphis. In this city, homes sell fast, and the average ROI is an impressive 132.7%.
Atlantic City, New Jersey
New Jersey boasts a high average median income and a robust house market. The state also has many realtors and an average ROI of 141.6%. It is, therefore, an excellent destination for house flippers to consider. As for the best places to flip houses in NJ, we would recommend Atlantic City. Due to its proximity to New York and rapid growth, Atlantic City is an attractive destination. The same can be said about flipping houses in Maryland, the state that ranked just under New Jersey.
Virginia Beach, Virginia
Virginia has a lot to offer to house flippers, starting with an average ROI of nearly 100%. The average profit per flip in this state is $91,783, while homes sell in about 73 days. Virginia Beach, Lexington, and Chesapeake are some of the best places to flip houses in Virginia. Here, the market is stable, and the prices are reasonable. Meaning, it’s possible to flip cheap houses and make a profit.
(CNBC, Bob Vila, Redfin)
House Flipping FAQ
What is house flipping?
House flipping is purchasing a property and intending to sell it for a profit. Flipping is an investment strategy where the investor buys something and quickly resells it for a higher price. Often, the process includes remodeling the property to increase its profit potential.
Is flipping houses still profitable?
Yes, but the potential fluctuates. In 2021, the average gross profit of house flipping was about $65,000. In 2022, it rose marginally to $67,000. The ROI of house flipping, meanwhile, heavily depends on the state.
(The Motley Fool)
How much does the average house flipper make?
This depends on many factors, including location, marketing, and skills. Naturally, the best places to flip houses would be more profitable. On average, though, experienced flippers can end up with a profit of $25,000 per flip. In Mississippi, for example, the average gain is $10,000, while in Missouri, it moves around $36,000. According to ZipRecruiter, the average house flipper salary in 2022 is $74,680 a year.
(ZipRecruiter)
What kind of homes are the best to flip?
A three-bedroom house of 2,000 square feet is the typical home purchase in the US. This home includes three bathrooms and costs about $230,000. So, this type of house is your best bet if you want to make a profit out of house flipping.
What is the 70% rule in house flipping?
A house flipper should invest no more than 70% of the after repair value (ARV) of the property, minus repair costs. ARV represents the value of an estate after repairs have been done. For example, let’s say the ARV is $100,000, and repairs cost $15,000. So, the investor shouldn’t pay more than $55,000 (70% of $100,000 minus the $15,000). Applying this rule ensures you won’t overpay for properties you want to flip.
The Bottom Line
When you know the best places to flip houses and have the right information, you can profit from house flipping. Beware that flipping homes is a time-consuming task that also requires money and skills. Once you get the knack for it, however, you can make an average of $25,000 per successful house flip.
References: Stewart, Census, Houzz, World Population Review, Census, Zillow, ListWithClever, The, American Genius, CNBC, Bob Vila, Redfin, The Motley Fool
DIY Builds
Photo: Pixabay
Promotion
Promotion