Profits for home flippers have been on a gradual decline for greater than a decade, and return on funding hit a 17-year low in the second quarter of this 12 months, impacting a market some lenders serve.
The common return on funding for a flipped home was 25.1% in the second quarter of 2025, a stark distinction to 62.9% in the autumn of 2012, in line with Attom, a property information and analytics agency.
Investors flipped greater than 78,000 single-family properties and condos from April by means of June, accounting for 7.4% of whole home gross sales throughout the interval, a slight lower from final 12 months’s 7.5%.
Gross income had been additionally down on a month-to-month and year-over-year foundation, as the everyday flipped home earned $65,300 in the second quarter, down 4% from the earlier quarter and 13.6% from the identical time final 12 months.
“We’re seeing very low revenue margins from home flipping due to the traditionally excessive value of properties,” ATTOM CEO Rob Barber stated in a press launch. “The preliminary buy-in for properties which can be splendid for flipping, usually decrease priced properties which will want some work, retains going up.”
The median buy value for a home flipper was $259,700 in the second quarter, the very best it has been since ATTOM, a property information firm, started monitoring it in 2000. The median gross sales value of flipped properties was the identical as final quarter at $325,000.
“As potential owners get priced out of the center and excessive finish of the market, they’re extra prone to be competing with flippers over the identical properties,” Barber stated.
The fall in income is one other signal of a softening housing market, as stock reached multiyear highs and buy demand remained sturdy final month.
Minimal return on investments may result in stricter financing requirements for buyers, although, as lenders could also be extra cautious with much less room for sudden prices.
The report additionally confirmed that Georgia was essentially the most energetic state in the nation, as home flips accounted for at the very least 13% of gross sales in 4 metropolitan areas in the state. Orlando, Florida, one of many hottest markets in 2024, noticed the second-biggest drop off amongst metro areas with a inhabitants of greater than 1,000,000 from 35.6% to 22.3%.
Some components remained regular, as 62.6% of all flipped properties had been bought fully in money, the identical fee as a 12 months prior, and the time it took to flip a home on common was 165 days, up from 163 days in the earlier quarter however down from 167 days the identical time final 12 months.
