These Are the 10 Worst States to Flip a House In

Are you’re intrigued by the idea of flipping a house to make some extra cash or to build wealth and you want to give it a shot? Well, the state you flip the house in can have a substantial impact on how profitable your endeavor can be. There’s no magic formula to measure the exact impact of your geographic location, but anecdotal evidence and data analysis give us a good understanding of the potential returns we can expect.

Say, for example, you’re on the East Coast in Maryland – data shows you might get more for your buck. On the other hand, flipping homes west of the Mississippi River could produce smaller returns since properties there tend to stay on the market for a longer amount of time.

A study by GOBankingRates, as reported by CNBC, analyzed data from real estate site Zillow and property data experts ATTOM. The study showed that 10 states in particular aren’t ideal when it comes to flipping homes.

They based their findings in four key areas:

• Median house listing price
• Average number of days it takes to flip a house
• Average gross profit on flipping
• Average gross return on investment

According to the study, you can flip a home in the best states in 180 days on average, while the worst states typically take longer, around 203 days. Each day your property continues to sit on the market can take a chunk of your bottom line profits, which can be especially stressful if you’re borrowing money to buy the homes you flip.

So, before you jump into purchasing a home to flip, here are the 10 worst places to consider, according to GBR’s findings:

Mississippi

Average house listing price: $195,390

Average time to flip: 220 days

Average profit: $9,875

Average ROI: 4.3 percent

Hawaii

Average house listing price: $905,687

Average time to flip: 198 days

Average profit: $76,266

Average ROI: 27.7 percent

Montana

Average house listing price: $314,959

Average time to flip: 223 days

Average profit: $30,326

Average ROI: 12.9 percent

Wyoming

Average house listing price: $291,855

Average time to flip: 231 days

Average profit: $33,475

Average ROI: 18 percent

South Dakota

Average house listing price: $238,163

Average time to flip: 188 days

Average profit: $17,750

Average ROI: 26.1 percent

Idaho

Average house listing price: $349,000

Average time to flip: 182 days

Average profit: $26,606

Average ROI: 14.6 percent

Utah

Average house listing price: $440,946

Average time to flip: 194 days

Average profit: $49,295

Average ROI: 27.9 percent

New Mexico

Average house listing price: $254,798

Average time to flip: 203 days

Average profit: $43,863

Average ROI: 26.6 percent

North Dakota

Average house listing price: $226,863

Average time to flip: 208 days

Average profit: $54,934

Average ROI: 39.6 percent

Missouri

Average house listing price: $204,506

Average time to flip: 179 days

Average profit: $36,475

Average ROI: 47.3 percent

Alternatives to flipping houses

Flipping a house can require a ton of attention and energy, and while it might prove profitable, some people just don’t have the time to commit to it. As an alternative, consider an easier route to investing in real estate — real estate investment trusts (REITs). Learning how to invest in real estate through REITs is easier than ever as more options are being made available to us.

Fundrise, an online real estate investment platform, is one of these options. With Fundrise, you can get started learning how to invest money in real estate investing for just $10. Your funds are allocated across a diversified mix of private real estate assets located throughout the United States. It’s easy to get started, and your investments won’t require as much out of you as flipping a house does.

Bottom line on where to avoid flipping houses

Flipping houses can be profitable, but not every state is as great a place to flip houses as other states. Also, keep in mind that things like homeowners associations (HOAs), extra fees, and marketing your property can cut into your bottom line.

Ultimately, your profits will depend on your individual circumstances when flipping a home, so it’s best to do your research before trying to make money on real estate.