Burnley has again claimed the crown as the top authority with the highest proportion of “flipped” homes in 2020, its sixth consecutive title, according to new data.
It comes as the proportion of homes flipped in England and Wales has soared back to levels not seen since 2008, Hamptons International revealed.
House flipping is when a real estate investor buys a house and sells it on for a profit. In order for a house to be considered a flip, it must be bought with the intention of quickly reselling.
The time between the purchase and the sale often ranges from a couple months up to a maximum 12 month period.
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So far this year 2.5% of homes sold have been flipped within a year, a figure which is likely to equate to around 23,000 transactions by the end of the year.
Despite the coronavirus pandemic, more homes will be flipped with greater profits made this year than in 2019. The average profit (£40,995, $54,400) on a flipped home in England & Wales has been boosted by a shift from flats to houses.
Just 5% of flipped homes bought and sold since the market reopened in May were flats, down from 20% in 2019.
More homes have been flipped in Burnley this year than in any other local authority in England and Wales, with 8.2% of properties sold in the region being flipped.
Some 81% were bought for £40,000 or less, under the threshold at which stamp duty is payable. More than nine in 10 (93%) of these purchases were terraced houses, bought for an average price of £38,000.
The north east and north west of England are the regions that continue to see the greatest number of homes flipped, with County Durham, Rutland, Middlesbrough and Stockton-on-Tees making up the top five.
It has been two years since anywhere in Southern England made it into the top 10, a reflection of the weakness of the market and the amount of stamp duty payable. In 2018 the London borough of Hackney saw the tenth largest proportion of homes flipped nationally.
The authorities that made up the rest of the top 10 leader board this year were: Wolverhampton, Hyndburn, Merthyr Tydfil, Darlington and Walsall.
Aneisha Beveridge, head of research at Hamptons International, said: “Flippers play an important role in the housing market by improving housing stock and taking on projects other buyers often won’t touch.”
She added: “Burnley has cemented itself in the top spot for the last six years as it’s one of the few places where investors can purchase a home without paying any stamp duty. And while the current stamp duty holiday will see flippers across the country save money, its full impact won’t be felt until early next year when these homes are likely to return to the market for sale.
“Given investors in more expensive areas will see larger stamp duty savings, there is potential for Burnley to be knocked off the top spot before too long.”
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