Home sellers across the country realized a median profit of $94,092 on the typical sale in 2021, according to Attom Data Solutions.
That’s up 45% from 2020 and 71% from two years ago as rapidly rising prices continued to provide a big boon to sellers nationwide. The national median home price rose 16.9% in 2021 to $301,000, another record high
Last year’s typical profit marked the highest since at least 2008, and profits rose in more than 90% of markets with enough data for Attom to evaluate.
Moreover, that median profit figure equated to a return on investment (ROI) of 45.3% compared to the property’s original purchase price, the largest year over year jump since 2013. The increase was up from 33.6% last year and from 30.6% in 2019, pushing profit margins to their highest since at least 2008. Both nationwide raw profits and ROI have now increased for 10 straight years.
The West again saw the highest returns on investment, with 16 of the 20 metros with the highest ROIs in the country situated in the region. Those cities included Boise (121% ROI); Spokane, Washington (86.5%); Bremerton, Washington (82.7%); Prescott, Arizona (81.2%); and Salem, Oregon (81.2%).
“What a year 2021 was for home sellers and the housing market all around the U.S.,” said Todd Teta, Attom’s chief product officer. “Prices went through the roof, kicking profits and profit margins up at a pace not seen for at least a decade. All that happened as the virus pandemic raged on, which actually helped drive the increases instead of stifle them.
“Households that escaped job losses from the pandemic dove into the market, in large part as a response to the crisis. And the rising demand led the market boom onward. No doubt, there are warning signs that the surge could slow down this year. But 2021 will go down as one of the greatest years for sellers and one of the toughest for buyers.”
Those warning signs came in the forms of weakening affordability rising foreclosures and lower investor profits. Lowered returns, coupled with the looming threat of inflation and increased mortgage rates, led to a recent report of growing pessimism in the real estate investor community. Still, Attom noted that the current imbalance in demand and supply suggests that there remains room for “at least some” additional price gains.