You’ve watched an entire season of HGTV’s Flip or Flop and you’re ready to start flipping houses. After doing a little research, you find that flipped homes produced an average gross profit of $58,250 in the first quarter of this year, according to a report by RealtyTrac. Sold.
But before you start sledgehammering that wall between the kitchen and the living room, there are many factors to consider when deciding to move into the house-flipping business -- one of them being location.
Financial advising site WalletHub has you covered. WalletHub analyzed 150 of America’s largest cities to find the best places in the U.S. to flip houses, considering factors such as median purchase price and bathroom-remodeling costs. In addition to placing the cities in an overall ranking, WalletHub breaks down each location into three categories: house-flipping market potential; renovation and remodeling costs; and quality of life.
Whether you aim to make house-flipping your new full-time gig or are remodeling on the side to generate funds for your dream venture, here are the top 10 cities for renovating real estate.
10. Laredo, Texas
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Laredo, a small city located on the banks of the Rio Grande, falls 10th on the list of best cities to flip houses.
Laredo's house-flipping market potential -- which factors in metrics such as the number of real estate agents per capita and the average gross return on investment -- ranks 58th out of the 150 cities that WalletHub analyzed. However, the costs of renovating and remodeling are relatively low in Laredo, which contributes to the city's high overall ranking.
Another important aspect to remember when preparing to flip a house is whether or not your potential buyers will want to live in a given location. Laredo ranks in the top third (46th place) for its quality of life -- in other words, it's a family-friendly place that offers potential for economic mobility.
9. Boise, Idaho
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Lace up your hiking boots: Boise is the ninth-best city in which to flip houses. Boise’s house-flipping market potential is a bit lower than that of other cities in the top 10, ranking 80th, but Boise’s strengths lie in its low renovation costs and high quality of life. The city ranks 11th and 29th in those categories respectively.
8. New Orleans, La.
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If you like jambalaya and crawfish, you’re in luck. New Orleans is eighth in the best house-flipping cities ranking.
Despite its reputation for festivals and food, New Orleans has the lowest quality of life among WalletHub’s top 10 house-flipping cities -- it's the only one in the bottom third for that category. But the city makes up for it with its first-place market potential ranking (out of 150 cities), and its house-flippers see the second-highest average gross return on investment compared with those in other cities.
As for renovation costs, New Orleans won’t break the bank -- The Big Easy falls 37th in that category.
7. Tampa, Fla.
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Tampa is the seventh-best U.S. city in which to flip houses (factoring in renovation costs and quality of life), and it is also the seventh-best city in terms of house-flipping market potential (independent of those factors). WalletHub examines the homes sold in a given city to determine market potential, and Tampa has the second-highest proportion of home flips in the country.
6. Lubbock, Texas
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Lubbock, home of Texas Tech University, is the sixth-best city for flipping houses. Lubbock comes in 19th for house-flipping market potential and 34th for renovation and remodeling costs -- which bodes well for a relatively inexpensive buying and flipping process.
Lubbock also provides a good quality of life, ranking 39th out of 150 cities, which signifies an abundance of potential home buyers.
5. Lincoln, Neb.
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Nebraska’s state capital is the fifth-best house-flipping city in the country.
Lincoln ranks 18th in house-flipping market potential and 38th in renovation and remodeling costs.
The city also offers a high standard of living, with the 22nd-highest quality of life. Livability names it a top-100 place to live, top-10 college town and top-50 place to live for entrepreneurs.
4. Oklahoma City, Okla.
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Home to one of the largest livestock markets in the world, Oklahoma City falls fourth on the list of best places to flip houses.
Oklahoma City ranks lowest in the quality-of-life category (58th). However, it ranks high in both house-flipping market potential and costs of renovation and remodeling, placing 10th and 13th respectively.
OKC is also tied for having the most real-estate agents per capita out of 150 cities, which contributes to its favorable market potential.
3. El Paso, Texas
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Texas claims three cities on the list of best places to flip houses, but El Paso ranks highest, sitting in third.
El Paso has the weakest market potential for flipping houses of the top 10 cities, but it's an optimal home-flipping location for other reasons. For one, its renovation and remodeling costs are low -- only nine (of 150) cities are less expensive than El Paso in that regard. El Paso also ranks in the top third for quality of life.
More than 70 Fortune 500 companies are based in the El Paso region, and it is the fourth-largest manufacturing hub in North America.
2. Fort Wayne, Ind.
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Fort Wayne, located in northeastern Indiana, comes in second on the list of best places to flip houses. Fort Wayne ranks 90th for house-flipping market potential, but it really shines because of its renovation and remodeling costs, which are the 14th-lowest among 150 cities analyzed.
Fun fact: Fort Wayne also has the lowest average bathroom remodeling cost. (Kitchens are cheapest to renovate in Mobile, Ala., and entire houses are least expensive to upgrade in Little Rock, Ark.)
Related: How to Start a Home Design Business
Fort Wayne ranks 47th out of 150 in quality of life.
1. Sioux Falls, S.D.
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A combination of inexpensive remodeling materials and a high quality of life makes Sioux Falls the best place to flip houses in the U.S., according to WalletHub’s analysis.
Sioux Falls ranks 66th out of 150 for its house-flipping market potential, but the city boasts the eighth-place rankings for both renovation costs and quality of life.