We are proud to introduce the Burns Fix and Flip Market Index (FFMI), in collaboration with our partners at Flatiron Realty Capital and Sundae. The FFMI is a diffusion-based index driven by our proprietary Fix and Flip survey of 400+ flippers across the country. The index gauges the overall health and sentiment of the national fix-and-flip business environment.
The FFMI is an index driven by a proprietary survey that gauges the overall health and sentiment of the national fix-and-flip business environment.
The index debuts at 78 out of 100. (0–100 scale where below/above 50 = contracting/expanding)
Here’s what we learned from 500+ market ratings from flippers this quarter:
- It’s a great time to be a flipper. Finished flips are being met by solid demand from entry-level (40% of purchases) and move-up (31%) buyers. Rental investors, both big and small, accounted for 20% of flipped home purchases in 4Q21.
- Costs are rising… Inflation is everywhere, and flippers are spending an average of $54K on renovations per home on materials and labor.
- …but profits are soaring! 43% of flippers sold their homes for MORE than the initially estimated after-repair value expected due to rapid home price growth (and just 5% sold below).
- After-repair value refers to a property’s estimated market value after renovations.
- Competition for deals is fierce. Two-thirds of flippers report more competition for homes to purchase than normal seasonally.
- Inventory is a challenge. With all the competition for deals, a lack of inventory is the #1 obstacle for flippers looking to expand their business.
The bottom-line: Fix-and-flip businesses are benefitting from the same basic fundamentals we’re seeing across the broader housing market: high demand and low supply. And like the housing market at large, affordability will be the watchword going forward. We will continue to monitor supply, demand, and affordability trends across the country to bring you the most timely and accurate real estate market insight.
Here are 3 opportunities for you:
- Are you a fix-and-flipper? Now is your chance to weigh in every quarter and receive free market-level data to help accelerate your business. Fill out this form here.
- Want more insight for free? Follow our company on Twitter, where we just reposted a thread from Alex Thomas containing qualitative color from some of the flippers we surveyed.
- Do you want to see the whole report every month, along with the rest of our research, so you can make the most informed decisions possible? We have a whole suite of paid subscriptions that can cater to your needs. Contact us here.
- National, regional, and metro-level data and analysis covering the new home market for 100+ metros
- National and metro-level data and analysis covering the single-family rental market for 99 metros
- National and product-level data and analysis covering building products and repair-and-remodel spending
Flatiron Realty Capital is a tech-enabled real estate portfolio lender.
Sundae connects homeowners looking to sell their house, no matter its condition, to one of the largest networks of investors to ensure the highest possible offer. Sundae holds real estate brokerage licenses in multiple states. A list of their real estate licenses and other regulatory information are available at sundae.com/disclosures.
