Profit margins on median-priced single-family home and condo sales rose to 47.7% during the second quarter, according to new data from ATTOM. This represented the first gain in a year and an increase from the 43.9% in the first quarter.
The median nationwide home price was up 10% to $350,000. However, the typical second quarter investment return nationwide was below the recent peak of 53.2% recorded in the second quarter of 2022.
Gross profits were also up from the first to the second quarter of 2023, with a 17% upswing on the typical single-family home and condo sale $113,000. But this was down 5% from one year ago.
“Just when it looked like the housing market was flattening out, prices spiked again, which pushed seller profits back up to nearly their highest level in the past decade,” said Rob Barber, CEO for ATTOM. “Stable mortgage rates, an ongoing tight supply of homes for sale and the usual Springtime surge in buyer demand appeared to have combined to halt the downturn we started seeing a year ago. It’s way too early to predict another long-term price run-up, especially since buying a home is a financial stretch for so many households around the country. But the second-quarter numbers clearly show the market has more steam left in it, and sellers are reaping the benefits.”
Everyone is jumping on the train until it crashes or nobody can afford a home. This doesn’t leave much room equity for anyone buying anything. The debt for anyone buying these overpriced, outdated homes can’t sustain.