HOME SELLING PROFITS SLIDE AGAIN IN 2024 ACROSS U.S. DESPITE CONTINUED PRICE GAINS

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Jan 23, 2025, 00:01 ET

Profit Margins for Sellers Decrease for Second Straight Year;
Typical Seller Return Remains Near Record Highs, But Declines to 54 Percent;
Returns Dip Even as National Median Home Price Climbs to $350,000

IRVINE, Calif., Jan. 23, 2025 /PRNewswire/ -- ATTOM, a leading curator of land, property data, and real estate analytics, today released its Year-End 2024 U.S. Home Sales Report, which shows that home sellers made a $122,500 profit on typical sales nationwide in 2024, generating a 53.8 percent return on investment.

But even as both measures remained near record levels, and home prices kept rising around the country, the profit margin on median-priced sales nationwide decreased from 56.9 percent from 2023. The drop-off marked the second straight annual decline - a pattern of consecutive downturns that hadn't happened since the aftermath of the Great Recession in the late 2000s.

While the gross profit on median-priced single-family home and condo sales did inch up about $2,000 from 2023, the typical profit margin stood eight percentage points below a peak hit in 2022.

The downward investment-return trend continued despite the median national home price rising 5 percent to yet another annual record of $350,000. Margins fell back as the increase in home values failed to keep up with larger price spikes recent sellers had been paying when they originally bought their homes.

"After a weak 2023, the U.S. housing market mostly rebounded nicely in 2024. Prices went back up at a healthy clip and homeowners continued to make some of the best profits on sales in the past 25 years. The renewed shine, however, didn't come without a bit of tarnish as margins took another turn for the worse," said Rob Barber, CEO at ATTOM. "Amid the generally good news, that's something worth following closely in 2025."

He noted that "home prices are stretching household budgets more and more, and mortgage rates have been going back up in recent months even as other forces put more upward pressure on prices. So, there are certainly major factors that could propel the market up or settle it back down. Either will have a significant effect on seller returns."

The price-and-profit picture, while mixed, reflected an ongoing housing market boom that has continued for 13 years in a row. Last year's scenario emerged as buyers buoyed by rising wages, a strong investment market and mostly receding mortgage interest rates competed for a historically tight supply of homes. Nevertheless, the resulting price gains weren't quite enough to push profits upward.

Among 127 metropolitan statistical areas with a population greater than 200,000 and sufficient sales data, sellers in more expensive markets around the U.S. generally reaped the highest returns on investment in 2024. Geographically, the Northeast, South and West regions led the way with 29 of the 30 highest ROIs. They were led by San Jose, CA (105.8 percent return on investment); Knoxville, TN (94.3 percent); Ocala, FL (87.1 percent); Seattle, WA (85.6 percent) and Scranton, PA (85 percent).

Historical U.S. Home Seller Gains

National median home price rises another 5 percent
After a weak annual gain of just 1.1 percent in 2023, the U.S. median home price increased another 4.9 percent in 2024, hitting the latest all-time high of $350,000. The typical 2024 price was almost 2 ½ times the nationwide median in 2011, a point in time right before the housing market began recovering from the Great Recession.

Amid the tight supply of properties for sale, median values went up last year in 115, or 91 percent, of the 127 metropolitan statistical areas around the U.S. reviewed for this report. Those with the biggest year-over-year increases were Evansville, IN (median up 13.4 percent); Augusta, GA (up 13.2 percent); Albany, NY (up 12.3 percent); Fort Wayne, IN (up 12.2 percent) and Scranton, PA (up 12.1 percent).

The largest median-price increases in metro areas with a population of at least 1 million in 2024 came in Hartford CT, (up 11.1 percent); New York, NY (up 9.6 percent); Rochester, NY (up 9.5 percent); Detroit, MI (up 9.5 percent) and Providence, RI (up 9.4 percent).

Typical home prices last year reached or tied records in 108 of the metros analyzed (85 percent), including New York, NY; Los Angeles, CA; Chicago, IL; Houston, TX, and Washington, DC.

Metro areas where median prices dropped most in 2024 were Birmingham, AL (down 8.3 percent); Ocala, FL (down 5.9 percent); Fort Myers, FL (down 4.3 percent); Lakeland, FL (down 2.8 percent) and Sarasota, FL (down 2.7 percent).

Profit margins decrease in three-quarters of nation, with worst declines in South
Profit margins on typical home sales went down from 2023 to 2024 in 93 of the 127 metro areas with sufficient data to analyze for investment returns (73 percent).

The 10 largest decreases in investment returns were all in the South, led by Fayetteville, AR (ROI down from 71.9 percent in 2023 to 51.3 percent in 2024); Ocala, FL (down from 105.7 percent to 87.1 percent); Sarasota, FL (down from 80.6 percent to 64.6 percent); Chattanooga, TN (down from 80.6 percent to 65.9 percent) and Crestview-Fort Walton Beach, FL (down from 60.1 percent of 45.9 percent).

The largest ROI losses from 2023 to 2024 in metro areas with a population of at least 1 million were in Birmingham, AL (ROI down from 44.3 percent to 33.5 percent); Tampa, FL (down from 80 percent to 69.8 percent); San Antonio, TX (down from 34.4 percent to 26.4 percent); Austin, TX (down from 46.5 percent to 39.5 percent) and Portland, OR (down from 70 percent to 63.6 percent).

The biggest increases in investment returns from 2023 to 2024 came in Syracuse, NY (ROI up from 56 percent to 69.3 percent); Rochester, NY (up from 61.9 percent to 72.3 percent); Evansville, IN (up from 34.6 percent to 44.7 percent); Cleveland, OH (up from 51.6 percent to 61.2 percent) and Akron, OH (up from 50.3 percent to 59.2 percent).

Aside from Rochester and Cleveland, metro areas with a population of at least 1 million and the best increases in profit margins in 2024 included Hartford, CT (up from 67.6 percent to 75 percent); Buffalo, NY (up from 75.6 percent to 82.6 percent) and San Jose, CA (up from 99.9 percent to 105.8 percent).

Sellers in more than half of U.S. still reaping gross profits above $100,000, with best levels in coastal markets
Despite the decline in profit margins across much of the country, gross profits on median-priced home sales in 2024 still topped $100,000 in 79, or 62 percent, of the metro areas with sufficient data to analyze.

The east and west coasts had 18 of the top 20 gross profits last year, led by San Jose, CA ($782,750); San Francisco, CA ($500,000); San Diego, CA ($372,000); Los Angeles, CA ($366,500) and Seattle, WA ($332,000).

The 20 smallest gross profits in 2024 were in the South and Midwest, reflecting lower home prices in many parts of those regions. The lowest gross profits were in McAllen, TX ($42,212); Peoria, IL ($43,500); Baton Rouge, LA ($45,180); New Orleans, LA ($46,750) and Birmingham, AL ($50,171).

Homeownership tenure rises to high point since 2000
Homeowners in the U.S. who sold in the fourth quarter of 2024 had owned their homes an average of 8.18 years, the longest tenure since at least 2000. The latest figure was up from 8.04 years in the third quarter of last year and from 7.8 years in the fourth quarter of 2023. Average seller tenures were up, year over year, in 74, or 72 percent, of the 103 metro areas with a population of at least 200,000 and sufficient data.

The biggest increases in average seller tenure from the fourth quarter of 2023 to the fourth quarter of 2024 were in Eureka, CA (up 19 percent); Sarasota, FL (up 16 percent); Bremerton, WA (up 14 percent); Ventura, CA (up 11 percent) and Chico, CA (up 10 percent).

Average U.S. Homeownership Tenure

The longest tenures for home sellers in the fourth quarter of 2024 were in Barnstable, MA (13.6 years); Bridgeport, CT (13.23 years); New Haven, CT (13.05 years); Ventura, CA (12.85 years) and Hartford, CT (12.69 years).

Cash sales at highest level since 2013
Amid mortgage rates that still were double where they stood three years ago, all-cash purchases accounted for 38.9 percent of single-family home and condo sales in 2024, or about one of every three. The latest portion, up from 38.1 percent in 2023, represented the highest level since 2013. It was up for the fourth straight year, although still off from the 44.7 percent peak this century in 2011.

Among 153 metropolitan statistical areas with a population of at least 200,000 and sufficient cash-sales data, those where cash sales represented the largest share of all transactions in 2024 included Myrtle Beach, SC (61.3 percent); Naples, FL (61.2 percent); Macon, GA (59.7 percent of sales); Warner Robins, GA (58.2 percent) and Utica, NY (57.9 percent).

Lender-owned foreclosure purchases virtually unchanged, remaining at one of lowest levels since 2005
Foreclosure sales to lenders accounted for just 1.4 percent, or one of every 72 single-family home and condo sales in 2024. That was the second lowest level since 2005. Last year's figure was down slightly from 1.5 percent of sales in 2023 and far below a peak of 23.6 percent in 2009.

States where lender-purchased (REO) foreclosure sales comprised the largest portion of total transactions in 2024 were Louisiana (3.6 percent of sales), Hawaii (3.4 percent), Illinois (3.3 percent), Maryland (2.8 percent) and Michigan (2.6 percent).

Among metropolitan statistical areas with a population of at least 200,000 and sufficient data, those where lender-purchased foreclosure sales represented the largest portion of all sales in 2024 were Binghamton, NY (6.1 percent); Lake Charles, LA (5 percent); Macon, GA (5 percent); Peoria, IL (4.6 percent) and Warner Robins, GA (4.6 percent).

Metro areas with the smallest shares were Raleigh, NC (0.2 percent of sales); Denver, CO (0.3 percent); Myrtle Beach, SC (0.3 percent); Tucson, AZ (0.3 percent) and Phoenix, AZ (0.4 percent).

Institutional investing down again in 2024
Home purchases by institutional investors dropped for the third year in a row, declining from 6.9 percent in 2023 to 6.3 percent in 2024, or one of every 16 single-family home and condo sales in the U.S.

Among metropolitan statistical areas with a population of at least 200,000 and sufficient institutional-investor sales data, those with the highest portions of institutional-investor transactions in 2024 were Memphis, TN (15.1 percent of sales); Huntsville, AL (12.5 percent); Birmingham, AL (12.4 percent); Fayetteville, NC (11.1 percent) and Columbus, GA (11.1 percent).

Historical U.S. Home Sales By Type

FHA sales dip slightly
Nationwide, buyers using Federal Housing Administration (FHA) loans accounted for 8.4 percent, or one of every 12 single-family home and condo purchases in 2024. That was down from 8.8 percent in 2023, marking the fourth drop-off in the last five years.

Among metropolitan statistical areas with a population of at least 200,000 and sufficient FHA-buyer data last year, those with the highest share of purchases made with FHA loans were Merced, CA (24 percent of sales); Bakersfield, CA (22 percent); Lakeland, FL (21.1 percent); Visalia, CA (20.5 percent) and Modesto, CA (19.4 percent of sales).

Report methodology
The ATTOM U.S. Home Sales Report provides percentages of distressed sales and all sales that are sold to investors, institutional investors and cash buyers in states and metropolitan statistical areas. Data is also available at the county and zip code level upon request. The data is derived from recorded sales deeds, foreclosure filings and loan data. Statistics for previous quarters are revised when each new report is issued as more deed data becomes available.

Definitions
All-cash purchase: sale where no loan is recorded at the time of sale and where ATTOM has coverage of loan data.

Homeownership tenure: for a given market and given quarter, the average time between the most recent sale date and the previous sale date, expressed in years.

Home seller price gains: the difference between the median sales price of homes in a given market in a given quarter and the median sales price of the previous sale of those same homes, expressed both in a dollar amount and as a percentage of the previous median sales price.

Institutional investor purchases: residential property sales to non-lending entities that purchased at least 10 properties in a calendar year.

REO sale: a sale of a property that occurs while the property is actively bank owned (REO).

About ATTOM
ATTOM provides premium property data and analytics that power a myriad of solutions that improve transparency, innovation, digitization and efficiency in a data-driven economy. ATTOM multi-sources property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, and neighborhood data for more than 155 million U.S. residential and commercial properties covering 99 percent of the nation's population. A rigorous data management process involving more than 20 steps validates, standardizes, and enhances the real estate data collected by ATTOM, assigning each property record with a persistent, unique ID — the ATTOM ID. The 30TB ATTOM Data Warehouse fuels innovation in many industries including mortgage, real estate, insurance, marketing, government and more through flexible data delivery solutions that include ATTOM Cloud, bulk file licenses, property data APIs, real estate market trends, property navigator and more. Also, introducing our newest innovative solution, making property data more readily accessible and optimized for AI applications – AI-Ready Solutions.