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Home Seller Profits Hit All-Time Highs in 2021

By agedleadstore
Home Seller Profits Hit All-Time Highs in 2021 Feature Image
3 minute read

More 2021 housing market records are piling in, including homeowner sale profits and returns on investment.

Homeowners who sold their homes last year had a median profit of $94,092, according to a year-end market report from database management company ATTOM.

This is the highest level of profitability since at least 2008, when ATTOM began tracking median purchase and sales price data.

The profit is a 45.3 percent gain, up from $64,931 in 2020 and $55,000 in 2019.

The national median home price also set an annual record by gaining 17 percent in 2021, up to $301,000.

The report showed ROI was up about 12 percentage points from 2020 to 2021, which is the largest annual increase since 2013.

Metropolitan areas along the West Coast had the highest ROI. Boise, Idaho, was in the lead with ROI at 121.8 percent.

All-cash sales were also at their highest level since 2015, with 30.3 percent of transactions.

The number of investors purchasing residential properties contributed to this percentage, and these buyers accounted for 6.9 percent of single-family home and condo sales.

This percentage is the highest since 2013.

Experts say investors are being driven in part by rising rent rates, which has contributed to the lack of inventory for first-time buyers.

While the report posted many market gains, it also marked some notable falls.

Homeowners who sold their homes in the fourth quarter of last year had owned them for an average of 6.14 years, which is the shortest average tenure since 2012.

This number was down from 6.34 years in the third quarter of last year, and down from 8.03 years in the fourth quarter of 2020.

The nation is largely continuing to operate as a seller’s market, with high competition and a continued lack of inventory, even as contractors rush to build.

Real estate experts recommend those searching for a home look for properties that are below their budget, in anticipation of bidding wars.

They also suggest getting in tip-top financial shape to snag the best interest rate. This includes boosting credit scores and paying down debts to reduce debt-to-income ratio.

Experts say to lean on a trusted real estate agent and loan officer to make the best offers and find the most effective lending solutions.

As rates remain steady in anticipation of Federal Reserve actions, buyers are taking any last-minute opportunities to grab current rates.

However, experts want to remind borrowers to focus on what they can control and what they can afford, rather than the current market fluctuations.

Photo by J King on Unsplash

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