IRVINE, CA--(Marketwired - Feb 6, 2014) - RealtyTrac™ (www.realtytrac.com), the nation's leading source for comprehensive housing data, today released a special report identifying the top 20 zip codes for home flipping to hipsters -- where a home is purchased and resold for a profit within a six-month period.
RealtyTrac analyzed zip code-level data to identify markets with a large population of hipsters where investors are realizing the biggest profits from flipping homes, and where buying a home is affordable for median-income buyers -- to ensure continued demand for homes being flipped.
To qualify as a hipster hot spot, a zip code had to have at least 15 percent of its population between ages 25 and 34 (above the national average of 13.2 percent) and have at least 15 percent of its population walk or take public transportation to work (above the national average of 20 percent).
To qualify as a good market for home flipping, a zip code had to have a minimum of 10 homes flipped in 2013, a median home that was five times or less the median household income and an estimated monthly house payment -- including mortgage, taxes and insurance -- that was lower than the average fair market rent for a three-bedroom home .
Top 20 Zip Codes for Flipping Homes to Hipsters
|ZIP||City||State||25-34 Pct of Population||Pct Walked or Public Transit to Work||Number of Flips 2013||Avg Flip Purchase Price||Avg Gross Flip Profit||Gross Profit Pct||Price to Income Ratio|
The U.S. Census bureau shows homeownership rates for people aged 25 to 34 (the prime demographic for hipsters) was at 41 percent in 2012. That is well off the average homeownership rate of 46 percent from 1982 to present for that age group, and it's certainly below the high of more than 49 percent in 2004. The homeownership rate for this age group has been below the long-term average since 2009, creating a deficit of hipster homeowners.
"The low hipster homeownership rate of the past five years translates into a market of potentially millions of first-time homebuyers looking to find a home that matches their budget and fits into their hipster lifestyle," said Daren Blomquist, vice president at RealtyTrac. "Real estate investors who want to tap into that trend should start with location: finding homes in communities with a heavy hipster demographic, and that are affordable for that demographic."
"The overcorrection of the Las Vegas housing market and the ability to find a lightly distressed property are a couple of the main factors that make flipping a home in Las Vegas profitable," said Gordon Miles, president, COO of Prudential Americana Group, covering the Las Vegas market. "Las Vegas zip codes 89169 and 89119 are older zip codes that were hit hard during the foreclosure crisis, offering buyers great opportunities to flip in this area. Add in the close proximity to the Las Vegas Strip and UNLV, and it becomes a prime area for flipping to the hipster demographic. The community surrounding the university has all started to change with the addition of new restaurants and hip shops, and we're noticing the areas that were once old are becoming new again."
"Another great side to flipping in these zip codes is Las Vegas is experiencing excellent rental returns so if you buy a property, flip it and end up holding on to it as a rental property, you'll still see profit," he added.
"We continue to see low housing inventory in the D.C. metropolitan area, making homes that have been flipped more attractive to potential home buyers," said Charlie Bengel, Jr., CEO of RE/MAX Allegiance, covering the Virginia, Maryland and D.C. areas. "By purchasing a flipped home, they are able to get into a home that feels new while still being in an established neighborhood."
About RealtyTrac Inc.
RealtyTrac (www.realtytrac.com) is the nation's leading source of comprehensive housing information, with more than 1.5 million active default, foreclosure auction and bank-owned properties, and more than 1 million active for-sale listings on its website, which also provides essential housing information for more than 95 million homes nationwide. This information includes property characteristics, tax assessor records, bankruptcy status and sales history, along with 20 categories of key housing-related facts provided by RealtyTrac's wholly-owned subsidiary, Homefacts®. RealtyTrac's foreclosure reports and other housing data are relied on by the Federal Reserve, U.S. Treasury Department, HUD, numerous state housing and banking departments, investment funds as well as millions of real estate professionals and consumers, to help evaluate housing trends and make informed decisions about real estate.