Market Insight - August / September 2019
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Do the sums still stack up for flippers?

Buying and selling a home in quick succession, or flipping as it’s often referred to, began in earnest in the 2000s. But as house price growth stalled, so has the number of flippers. Last year, 18,630 homes were flipped in England and Wales, 69% less than the 60,340 flipped at the height of the practice in 2004.
Flippers who typically, buy, renovate and sell on, play an important role; not only do they improve the quality of housing stock in a local market, but bring empty homes back into use too. In order to maximise profits, they tend to operate best when house prices are rising; a less buoyant market offers speculators fewer opportunities.


Today, flippers make up a smaller part of the total housing market. In 2004, 4.8% of homes sold in England and Wales were bought and sold within a 12-month period, last year it was just 2.1% - slightly up (by 0.1%) on 2017.

In 2018, flipping accounted for £3.9 billion worth of sales, half the value recorded in 2004, with the average flipper selling their property (pre-tax) for £30,150 more than they paid for it. While this represents an average gain of 22%, it is less than the 32% made in 2004 when prices were rising at a faster rate than today.


In fact, since 2004 the number and proportion of homes flipped has fallen in every region, with London seeing the biggest drop – down 81%.

However, comparing 2018 with 2017, shows a small rise in flipping across all regions apart from London. The North East saw the biggest increase with the proportion of flipped homes rising from 3.3% in 2017, to 3.6% in 2018. This in contrast to London which fell from 1.5% in 2017, to 1.4% in 2018.

Burnley tops the league table for flipping in England and Wales. Last year 11.2% of homes sold in Burnley were bought in the previous 12 months; Wolverhampton (6.1%), Hyndburn in Lancashire (5.4%) and Hackney (5.1%) followed. Hackney was the only London borough to appear in the top 15 local authorities’ league table last year and represents the first appearance of a London local authority for two years.

Percentage of homes flipped (2018)

Source: Hamptons International & Land Registry 

 

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