Home Sellers Are Pocketing More Money
Homeowners who sold in the first quarter realized an average price gain of $44,000 since purchase. That represents an average 24 percent of return on the purchase price, which is the highest average price gain for home sellers in terms of both dollars and percent returns since the third quarter of 2007, according to ATTOM Data Solutions’ First Quarter 2017 U.S. Home Sales Report.
“The first quarter of 2017 was the most profitable time to be a home seller in nearly a decade, and yet homeowners are continuing to stay put in their homes longer before selling,” says Daren Blomquist, senior vice president with ATTOM Data Solutions. “This counterintuitive combination is in part the result of the low inventory of move-up homes available for current homeowners, while also perpetuating the scarcity of starter homes available for first-time home buyers.”
Homeowners who sold in the first quarter had owned their home for an average of 7.97 years, the report showed. Between the first quarter of 2000 and third quarter of 2007, before the Great Recession, average homeownership tenure was 4.26 years.
Still, “there are some early signs this inventory logjam may be loosening up in some markets, with the average homeownership tenure down from a year ago in nine of the 66 markets we analyzed, including Memphis, Dallas, Boston, Portland [Ore.], and Tampa,” Blomquist says. “Sky-high potential price gains may be finally prompting more homeowners to sell.”
Among 97 metro areas with at least 1,000 home sales in the first quarter that ATTOM Data Solutions analyzed, the following had the highest average price gain since purchase that was realized by home sellers:
San Jose, Calif.: $356,500 average price gain
San Francisco.: $276,750
Los Angeles: $187,000
Oxnard-Thousand Oaks-Ventura, Calif.: $160,000
California markets still dominated the list when looking at the metro areas with the highest return by percentage on the previous purchase price. The top five markets were:
San Jose, Calif.: 71% average ROI
San Francisco: 65%
Portland, Ore.: 52%
Modesto, Calif.: 51%