This is the most profitable time to sell a home in a decade
There’s real money in real estate.
If you’re dreaming about selling your home, you may be in luck. A report released Thursday by real estate analytics firm ATTOM Data Solutions finds that home seller profits have hit a 10-year high, with people who sold their homes in the second quarter of this year raking in $51,000. That’s the highest since the second quarter of 2007, when it was $57,000.
The big driver behind these massive profits is that home prices have risen rapidly. Median home prices across the nation are now above pre-recession levels, and in 44% of the 108 markets ATTOM looked at, home prices had hit an all-time high. What’s more, homeowners are waiting longer to sell their homes (homeownership tenure averages more than 8 years now, up from roughly 7.5 a year ago), which is helping boost profits.
The profits that home sellers are raking in are massive in some markets. No. 1 on the list: Silicon Valley, which has seen home prices rise exponentially. Indeed, home prices in the area are up roughly 80% just in the past five years.
5 markets where home sellers are seeing the biggest returns
1. San Jose, California (75% return, $410,000 gross profit)
2. San Francisco, California (65%, $306,000)
3. Seattle, Washington (63%, $165,000)
4. Modesto, California (62%, $104,950)
5. Denver, Colorado (62%, $140,500)
But this all comes with a big catch: “While it’s the most profitable time to sell in a decade, it’s also extremely difficult to find another home to purchase,” says Daren Blomquist, senior vice president at ATTOM Data Solutions. That’s because “new homes are being built at a historically low rate, and the new homes that are being built tend to be on the high end to maximize homebuilder profits,” he tells Moneyish. This ends up making new home inventory tough to afford — even if you made a big chunk of change selling your home. What’s more, the fact that there isn’t much on the market is keeping people in their homes a bit longer, and that constricts the supply of homes people can buy as well.
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