Big profits are back for home sellers
It’s a good time to be a home seller.
As a lack of inventory pushes home prices to record highs, sellers who put their homes on the market are making more money than at any point since the real estate bubble burst ten years ago. A new report from ATTOM Data Solutions shows that homeowners who sold in the second quarter of 2017 realized an average price gain of $51,000 since purchase, for a 27 percent return. Selling a home hasn’t been this lucrative since 2007.
Home sellers in San Jose, California, saw the highest returns (75 percent), followed by San Francisco (65 percent), Seattle (63 percent), and Modesto, California (62 percent).
In addition to higher prices, the higher returns may reflect that homeowners are staying in their houses longer, giving their properties more time to appreciate. Homeowners had been in their homes an average of 8.05 years, the longest average homeowner tenure in the 17 years for which data is available.
“Potential home sellers in today’s market are caught in a Catch-22,” Daren Blomqist, senior vice president at ATTOM Data Solutions. “While it’s the most profitable time to sell in a decade, it’s also extremely difficult to find another home to purchase, which is helping to keep homeowners in their homes longer before selling.”
Homebuyers, meanwhile, continue to face market headwinds. The number of all-cash buyers increased for the first time in four years, while the share of FHA buyers (typically first-time buyers or others with a low down payment) fell to its lowest level in two years.