Investors are flipping houses at a faster pace in Las Vegas than in most metro areas, but their profit margins are smaller here compared to most big cities, a new report shows.
Some 10.3 percent of home sales in the Las Vegas area in the first quarter were flips, according to RealtyTrac. That was the ninth-highest share among the 126 metro areas listed in the report and well above the U.S. rate of 6.6 percent.
Among states, Nevada topped the list at 9.7 percent.
RealtyTrac, based in Irvine, Calif., defined a flip as selling a home twice in a 12-month period.
Las Vegas flippers’ median purchase price last quarter was about $144,755 and their median sales price was $185,000, giving them a gross profit of around $40,245 per deal.
However, their profit margin — 27.8 percent — ranked 115th among the metro areas in the report.
Nationally, flippers booked an average gross profit of $58,250 per deal last quarter, a margin of 47.8 percent, RealtyTrac reported.
The company said the report tracked metro areas and states with at least 50 flips last quarter.
House flipping was a hallmark of last decade’s real estate bubble, when investors, backed by easy money, bought homes and sold them for profit a short time later. The get-rich-quick tactic helped inflate prices to record levels until the bubble burst and the economy crashed.
Few places got as crazed with flipping as Las Vegas, a poster child for the housing boom and bust. Locally, flipping peaked in the fourth quarter of 2004, when 19.4 percent of home sales were flips. It peaked nationally in the first quarter of 2006, at 9 percent, according to RealtyTrac.
Southern Nevada remains one of the most popular places in America to flip houses thanks to flipping-focused reality TV shows and Las Vegas’ lower home prices, transient population and long-standing image as an easy place to make a quick buck, industry pros have said.