Anyone who sold their home last year may have been shocked by the huge profit they made. The average gain realized by home sellers in 2021 came to $94,092, according to a new analysis by ATTOM Data Solutions. That’s up 45% from last year, and 71% from two years ago.
Home seller profits jumped in more than 90% of the housing markets tracked by ATTOM, based on median purchase and resale prices. Those are the highest gains since 2008.
The $94,092 profit on a median-priced home transaction in 2021 meant a 45.3% return on investment compared to the price people originally paid for their homes, ATTOM’s Year-End 2021 U.S. Home Sales Report found.
Home sale prices increased by double-digits over the past 12 months as properties for sale became scarce while buyers flooded the market. Buying activity has increased as a result of low interest rates and a desire by many people to change their living circumstances, which is a direct result of the COVID-19 pandemic.
“What a year 2021 was for home sellers and the housing market all around the U.S.,” said Todd Teta, chief product officer at ATTOM. “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 managed to escape job losses during the pandemic have rushed to the housing market, which has led to a market boom, Teta explained.
“No doubt, there are warning signs that the surge could slow down this year,” he continued. “But 2021 will go down as one of the greatest years for sellers and one of the toughest for buyers.”
Many western states saw some of the highest returns from typical home sales last year, led by Boise, Idaho (121.8% return on investment); Spokane, Wash. (86.5%); Bremerton, Wash. (82.7%); Prescott, Ariz. (81.2%); and Salem, Ore. (81.2%), according to the report.