The typical profit margin on home sales jumped nearly +48% in Q3 2021 across the country. This is the highest profit margin for sellers in the past 20 years.
Profit Margins on Median-Priced Single-Family Sales Soared 47.6%
According to ATTOM Data Solution’s Q3 2021 US Home Sales Report, the profit margins on median-priced single-family home and condo sales across the country jumped 47.6%, the highest level since the Great Recession one decade ago.
This report also indicated that the typical home sale generated a profit of $100,178 for the country’s median home price of $310,500. This profit level of $100,178 topped the $88,800 profit margin in Q2 2021 as well as the $69,000 profit margin in Q3 2020.
The typical ROI for sellers jumped to nearly +48% on their original purchase price from 42% in Q2 2021 and 34.5% in Q3 2020. This is the biggest quarterly ROI jump since 2014 as well as the biggest annual ROI surge since at least 2008, according to ATTOM.
READ: 2022 Top Agent Success Secrets [Revealed]: New FREE Real Estate Coaching Web Event, Revealing 17 Surprising Secrets Of The Top 100 $ Millionaire Agents. Get Your FREE Spot For The 2022 Real Estate Coaching Webinar Now. After You Have Attended This Event You Will Have A Huge Feeling Of Relief Knowing You Will FINALLY Laugh At Your Money Worries – You Will Have Your Own Personalized 2022 Step-By-Step Business Plan. Learn Now How To Generate 100’s of Motivated Leads for FREE, Without Coming Off As A Pushy Salesperson and Losing Your Soul. You Will Soon Know How To Become One of the 1000s of Agents Making HUGE Money Who Never Thought They Could. YES, I Want To Attend The FREE Webinar! <——Click To Register
(Register now as participation is limited.)
National Median Home Prices Skyrocketed in Q3
A whopping 93% of metro areas in the US saw an annual median home price surge of +15.9% y/y from Q3 2020 and an increase of +3.5% q/q from Q2 2021. Profit margins for sellers increased in 86% of the country’s metro areas.
Todd Teta, chief product officer with ATTOM, said, “The third quarter of this year marked another period in a banner year for a housing market boom that’s steaming ahead through its 10th year. Prices and seller profits again hit new highs since the market started coming back from the Great Recession in 2012.” Despite normal seasonality in home sales and a couple of economic bumps, Teta said, “…for now, the market engine seems to have nothing but high-octane gas in the tank.”
Where Annual Profit Margins Increased the Most and the Least in Q3 2021
The biggest annual increases in profit margins came in these metros:
- Boise City ID – from 61.4% in Q3 2020 to 130.3% in Q3 2021
- Claremont-Lebanon NH – from 41.1% to 93.8%
- Augusta GA – from 19.6$ to 56.6%
- Raleigh NC – from 30.4% to 67%
- Bellingham WA – from 69.5% to 105.6%
- Detroit MI – from 43% to 68%
- Rochester NY – from 39.4% to 63.8%
- Austin TX – from 47.6% to 70.9%
- Pittsburgh PA – from 40.1% to 61.9%
The biggest annual declines in profit margins came in these metros:
- Salem OR – from 75.6% in Q3 2020 to 48.3% in Q3 2021
- Brownsville TX – from 37.1% to 13%
- Kansas City MO – from 43.6% to 25.1%
- San Jose CA – from 86.2% to 71%
- McAllen TX – 33.4% to 19.9%
- Los Angeles CA – from 54.3% to 44.5%
- Cleveland OH – from 32.8% to 25.7%
- Las Vegas NV – from 43.8% to 37.2%
Cash Sales Hit Six-Year High
Country-wide, all-cash purchases represented 34% of all single-family house and condo sales during Q3 2021. This is the highest level of all-cash sales since Q1 2015.
Metros with the highest share of cash sales included:
- Columbus GA – 74.6% of all sales
- Atlanta GA – 69%
- Macon GA – 59.3%
- Youngstown OH – 56.6%
- Detroit MI – 56.2%
Institutional Investment Hit Seven-Year High
Institutional investors made their presence known in markets around the country during Q3 2021. Institutional investors accounted for 7.3% of all single-family house and condo purchases, the highest level since Q1 2014.
States with the largest percentages of sales to institutional investors in Q3 included:
- Arizona – 17.4% of all sales
- Georgia – 13.9%
- Mississippi – 12.8%
- Nevada – 12.7%
- North Carolina – 11.3%
States with the smallest levels of sales to institutional investors during Q3 2021 included:
- Hawaii – 1.7% of all sales
- Maine – 1.8%
- Vermont – 2.2%
- New Hampshire – 2.5%
- Rhode Island – 2.5%
Likewise, according to ATTOM, buyers using FHA loans represented just 8.3% of all single-family home and condo purchases in Q3 2021, the second lowest level since Q4 2007. And, home sales following foreclosures represented a mere 1% of all sales.
Thanks to ATTOM Data Solutions.
