Are you looking to maximize your profits by targeting your efforts on cities with specific attributes that make them the best cities for flipping houses and wholesaling? We decided to make it easy on you and conduct thorough research in the housing market to identify the best cities to flip houses as well as the best cities for wholesaling real estate.
Using a 3-point rating system, DealMachine looked at the top 50 cities by population and evaluated them based on multiple factors for both house flipping and wholesaling. Our goal was to determine the best cities for house flippers and wholesalers to target using a mixture of proprietary DealMachine and public data.
First, we’ll review the 10 best cities to flip houses and then share our results for the 10 best cities for wholesaling.
The Best Cities for Flipping Houses
To determine the best places to flip houses, we looked at several criteria that made these top 10 cities the most advantageous for real estate investors. We scored each city on a 3-point scale for the same 7 factors:
- Population Growth in 2021
- Home Sale Price
- Average Home Age
- Median Household Income
- Average Days on Market
- Highest Inbound Cities
- Listing Changes Year Over Year
Now, let’s get to the good part so you can pair this information with powerful house flipping software and land your next deal!
1. Seattle, Washington
Coming in at number 1 on our list is Seattle, Washington. Strong population growth, shortened time on the market, and a higher than average median household income of over $92K all point to continued flipping success.
Seattle scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 3 points
- Average Home Age - 2 points
- Median Household Income - 3 points
- Average Days on Market - 3 points
- Highest Inbound Cities - 3 points
- Listing Changes Year Over Year - 2 points
2. Tampa, Florida
Ranked by United Van Lines as one of the most popular cities moved to in 2020, Tampa has an inbound rate of 57% which means the number of buyers in this market is impressive. Another positive sign for home flippers is the low number of days homes spend on the market in this city. Tampa homes average only 7 days on the sales market before they are sold!
Tampa scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 3 points
- Average Home Age - 2 points
- Median Household Income - 3 points
- Average Days on Market - 3 points
- Highest Inbound Cities - 3 points
- Listing Changes Year Over Year - 2 points
3. Phoenix, Arizona
With all this metropolis has to offer, it’s not surprising to find Phoenix landing in the top three best cities for flipping houses. The population has been on a steady incline having risen nearly 20% over the last decade and is forecasted to rise another 1.92% in 2021. The influx of homebuyers paired with a reasonable average home price makes this market healthy for house flipping.
Phoenix scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 2 points
- Average Home Age - 2 points
- Median Household Income - 2 points
- Average Days on Market - 1 point
- Highest Inbound Cities - 3 points
- Listing Changes Year Over Year - 2 points
4. Denver, Colorado
House flippers looking for strong profits would be keen to tap the potential of consistently rising home values in Denver. Homes spend an average of only 5 days on the market in the Mile High City and the city’s popularity continues to drive a forecasted 1.17% population growth rate, which benefits home flipping.
Denver scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 2 points
- Average Home Age - 3 points
- Median Household Income - 2 points
- Average Days on Market - 3 point
- Highest Inbound Cities - 0 points
- Listing Changes Year Over Year - 1 point
5. San Diego, California
Offering a high-profit potential, San Diego’s average home sale price reaches an impressive $764,000. The median household income ranks above average at nearly $80K and there is no shortage of buyers in this market.
San Diego scoring:
- Population Growth in 2021 - 2 points
- Home Sale Price - 3 points
- Average Home Age - 2 points
- Median Household Income - 3 points
- Average Days on Market - 2 point
- Highest Inbound Cities - 0 points
- Listing Changes Year Over Year - 2 points
6. Charlotte, North Carolina
Scoring high for population growth with an inbound percentage of 63%, Charlotte’s average home sale price is $340,000, which makes it an appealing market for house flippers.
Charlotte scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 2 points
- Average Home Age - 1 point
- Median Household Income - 2 points
- Average Days on Market - 1 point
- Highest Inbound Cities - 3 points
- Listing Changes Year Over Year - 2 points
7. Jacksonville, Florida
Often overlooked by more well-known Florida cities like Miami and Orlando, Jacksonville shows steady population growth at a rate of 1.66% and has earned its reputation as a Fortune 500 hub.
Jacksonville scoring:
- Population Growth in 2021 - 3 points
- Home Sale Price - 2 points
- Average Home Age - 1 point
- Median Household Income - 2 points
- Average Days on Market - 1 point
- Highest Inbound Cities - 3 points
- Listing Changes Year Over Year - 2 points
8. San Jose, California
Another top-scoring market for house flippers is the “Capital of Silicon Valley”, San Jose. With a high median household income and quick to appreciate home prices, house flippers can make a considerable sum of money here.
San Jose scoring:
- Population Growth in 2021 - 1 point
- Home Sale Price - 3 points
- Average Home Age - 2 points
- Median Household Income - 3 points
- Average Days on Market - 2 points
- Highest Inbound Cities - 0 points
- Listing Changes Year Over Year - 2 points
9. Sacramento, California
California’s state capital of Sacramento scored especially well on average days on the market, which bodes well for house flippers. The average home only spends 7 days on this hot real estate market.
Sacramento scoring:
- Population Growth in 2021 - 2 points
- Home Sale Price - 2 points
- Average Home Age - 2 points
- Median Household Income - 2 points
- Average Days on Market - 3 points
- Highest Inbound Cities - 0 points
- Listing Changes Year Over Year - 2 points
10. Los Angeles, California
Known as the house flipping capital of California, Los Angeles achieves an average profit in the six figures for house flippers. Consistent population growth paired with increasing home sales year-over-year continues to keep LA on the list of best places to flip houses.
Los Angeles scoring:
- Population Growth in 2021 - 1 point
- Home Sale Price - 3 points
- Average Home Age - 2 points
- Median Household Income - 2 points
- Average Days on Market - 3 points
- Highest Inbound Cities - 0 points
- Listing Changes Year Over Year - 2 points
The Best Cities for Wholesalers
To determine the best markets to wholesale real estate, we looked at specific criteria needed for successful wholesaling. The attributes that make these 10 cities the most advantageous for real estate wholesalers are unique from what determines the best cities for flipping houses. By targeting these locations and using effective real estate wholesaling software, profitable wholesale deals can be made. We evaluated and scored each city on a 3-point scale for the same 3 factors:
- Market Value
- Home Age
- Number of Distressed Homes
1. Indianapolis, Indiana
Indianapolis landed the number 1 spot on our list for best cities for real estate wholesalers. With just under 20,000 distressed homes listed in the DealMachine database and an average home age of 49 years, there is tremendous potential for profitable wholesaling deals.
Indianapolis scoring:
- Market Value - 2 points
- Home Age - 3 points
- Number of Distressed Homes - 3 points
2. Saint Louis, Missouri
Ranking a close second is the city commonly referred to as the “Gateway to the West”, Saint Louis, Missouri. The average home age in Saint Louis is 52 and there are close to 11,000 distressed homes available in our database alone. Another appealing aspect for wholesalers is that the average sale price is $219,000, which means wholesalers can get into the market for a reasonable investment.
Saint Louis scoring:
- Market Value - 2 points
- Home Age - 3 points
- Number of Distressed Homes - 3 points
3. Kansas City, Missouri
Another top location for wholesaling homes is Kansas City. While the average home age in Kansas City is also 52 years and there are more distressed homes listed than in Saint Louis, the average sale price is a bit higher at $242,000.
Kansas City scoring:
- Market Value - 2 points
- Home Age - 3 points
- Number of Distressed Homes - 3 points
4. Houston, Texas
Houston makes the list of homes with the right buying criteria for wholesalers. The real estate market offers a wealth of distressed homes with over 30,000 available in our database. The average age is close to ideal at 36, and with such a high pool of distressed homes, you should find you have plenty of homeowners willing to sell at a feasible price.
Houston scoring:
- Market Value - 2 points
- Home Age - 2 points
- Number of Distressed Homes - 3 points
5. Fort Worth, Texas
The high number of distressed homes found in DealMachine for the Fort Worth area makes this one of the best markets to wholesale real estate in for wholesalers looking to find off-market potential. The average market sale price is $302K and the average home age is only slightly younger at 34 years old.
Fort Worth scoring:
- Market Value - 2 points
- Home Age - 2 points
- Number of Distressed Homes - 3 points
6. Dallas, Texas
You may notice a trend as this is the third city in Texas already on this list. Spoiler alert: there are a total of 5 cities from Texas that qualify for the top 10 list for wholesalers. All have highly desirable features for wholesalers, and Dallas is no exception. With an average home age of 41 and over 13,000 distressed homes identified in DealMachine, wholesalers have a wealth of opportunity in Dallas.
Dallas scoring:
- Market Value - 1 point
- Home Age - 3 points
- Number of Distressed Homes - 3 points
7. Tucson, Arizona
Scoring high for its number of distressed homes, Tucson also offers a great entry price for home buyers with an average sale price of $302K. This desert city attracts people from around the world and was designated as the first UNESCO City of Gastronomy in the United States.
Tucson scoring:
- Market Value - 2 points
- Home Age - 2 points
- Number of Distressed Homes - 3 points
8. Las Vegas, Nevada
The housing market in Las Vegas has been undergoing an extreme transformation over the last few years with an influx of new residents from California. The ample supply of distressed homes makes it a great target for wholesaling.
Las Vegas scoring:
- Market Value - 1 point
- Home Age - 2 points
- Number of Distressed Homes - 3 points
9. El Paso, Texas
The vibrant border town of El Paso has a modest median sale price of $203K, making it accessible for even beginner wholesalers. The highly encouraging year-over-year 12.8% growth in average sale price means there is money to be made.
El Paso scoring:
- Market Value - 2 points
- Home Age - 2 points
- Number of Distressed Homes - 2 points
10. Austin, Texas
Austin is well known for its music and nightlife, which are some of the factors that continue to draw people to the city and encourage them to stay. Austin makes the top 10 list because of its high number of distressed homes just waiting to be targeted by wholesalers.
Austin scoring:
- Market Value - 1 point
- Home Age - 2 points
- Number of Distressed Homes - 3 points
Make Flipping and Wholesaling More Profitable With DealMachine
A targeted approach to house flipping and wholesaling is the best way to yield desirable and profitable results. DealMachine makes it easy for you to find a property that meets your criteria and successfully close more deals. Our powerful software stack delivers all the tools you need in one easy-to-use platform. Looking to scale your business the smarter way? Sign up for your free trial of DealMachine today!
Methodology
Here, we’ll review the methodology and data sources DealMachine used to determine the best places for flipping houses and wholesaling.
Best Cities to Flip Houses
To determine the best cities for flipping houses, DealMachine looked at the top 50 cities by population and cross-checked with the top-selling metros of 2021. The top ten cities were then narrowed down based on the following criteria:
Population Growth in 2021
Using data from the World Population Review, we discerned the population growth percentages for the cities in 2021. Cities earned more points for higher growth rates.
Home Sale Prices
Average home sale prices for each city were collected using data from Redfin. The higher the home sale price, the more points the city was given.
Average Home Age
Using data collected by House Method, we measured the average home age in each city. Because older homes are more ideal for flipping, cities with higher average home ages scored better than those with lower average home ages.
Median Household Income
Median household income statistics were sourced from the United States Census Bureau. Higher household incomes were given more points when scoring while lower household incomes received fewer points. The reason being that higher median incomes result in a larger population of potential homeowners.
Average Days on Market
To understand how hot the housing market is in each location, cities were given more points for markets that sell homes in one week or less and fewer points for locations with longer on-market times. We collected this pertinent data from Redfin.
Highest Inbound Cities
Cities with a higher rate of inbound activity according to United Van Lines were scored higher than those with lower percentages.
Listing Changes Year Over Year
Using data from Realtor, we assigned points to cities based on percentages of listing changes. Locations with higher listing changes received more points than cities with lower listing changes.
Best Cities for Wholesaling
When determining the best cities for wholesaling houses, we started by looking at the top cities with the highest number of cash transactions in ListSource (no less than 350 per city). This resulted in a list of 21 cities which were then narrowed down based on how they ranked using the following criteria:
Market Value
Average market prices for each city were collected using data from Redfin. The higher the market prices, the lower the city scored because the best markets for wholesalers are those with lower home prices.
Home Age
The ideal home age for wholesaling is 40 years old. Using data from House Method, we scored each city based on its average home age with home averages 40 years and up receiving more points than cities with lower home age averages.
Number of Distressed Homes
Using proprietary data from DealMachine, we gave points to the top cities for the number of distressed homes available. Cities with a higher number of distressed properties received more points than those with fewer.
About David Lecko
David Lecko is the CEO of DealMachine. DealMachine helps real estate investors get more deals for less money with software for lead generation, lead filtering and targeting, marketing and outreach, and acquisitions and dispositions.
