ATTOM: Sellers’ Profit Margins Fell in 2024

(Image courtesy of ATTOM; Breakout image courtesy of Charlotte May/pexels.com)

ATTOM, Irvine, Calif., released its Year-End 2024 U.S. Home Sales Report, finding that the home sellers made an average 53.8% return on investment, or $122,500, last year.

However, that’s a drop from 56.9% in 2023, in the second straight annual decline. That pattern hasn’t happened since the aftermath of the Great Recession.

While the gross profit on median-priced single-family homes and condos sold inched up by $2,000 from 2023, the typical profit margin was eight percentage points below 2022’s peak.

Median home prices rose by 4.9% in 2024, to a high of $350,000. However, that increase didn’t keep up with the larger price spikes of the past few years, hammering those margins.

“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.”

Homeownership tenure hit the highest point since 2000. Homeowners who sold in Q4 2024 had owned their homes an average of 8.18 years, up from 8.04 years in Q3 and from 7.8 in Q4 2023.

Cash sales accounted for 38.9% of single-family home and condo sales in 2024, up from 38.1% in 2023, and marking the highest level since 2013. That metric also saw the fourth consecutive annual increase, but remains below 2011’s 44.7%.

Foreclosure sales were just 1.4% of all sales last year, the second lowest level since 2005. They accounted for 1.5% of sales in 2023.

Purchases by institutional investors dropped for the third consecutive year, to hit 6.3% in 2024. They amounted to 6.9% in 2023.

And, buyers using Federal Housing Administration loans made up 8.4% of purchases in 2024, down from 8.8% in 2023.