The fast-paced world of house flipping lost some of its steam last year, and housing professionals say 2025 may produce a similar decline if homeowners remain reluctant to sell.
California produced the most profits for real estate investors, according to new figures from analytics firm ATTOM, while Texas house flips posted more stunted returns.
Investors flipped 297,885 single-family homes and condominium units in 2024, down from 322,782 in 2023, ATTOM said. The typical profit per flip, however, grew from $67,846 in 2023 to $72,000 in 2024, ATTOM found. The data, released Thursday, suggests investors have slowed their flipping efforts because profits are not increasing as much as they would like, said ATTOM CEO Rob Barber.
"But even as activity waned, there was at least a glimmer of hope that returns were starting to turn around," Barber said in a statement Thursday. "While home flippers still seemed to be having difficulty timing the market for big profits, their margins at least stopped going in the wrong direction."
Homes flipped in 2024 were sold for a median price nationwide of $315,000, ATTOM said. However, the amount of flipping activity and profit varied nationwide.
Major cities in the South — including Charlotte, Jacksonville and New Orleans — saw the biggest declines in flipping activity between 2023 and 2024. Cedar Rapids, Iowa; Bellingham, Washington; and Warner Robins, Georgia, experienced the largest gains during the same period.
The ATTOM data also found that flipping in 2024 generated the most median profit in San Jose, California, at $283,000, in San Francisco at $218,000, and in New York City and San Diego — both at $175,000. The lowest median profit last year took place in Austin, Texas, at $8,844, San Antonio at $17,832, and Houston at $20,846.
Not enough sellers
Home flipping is a separate but ever-present engine in the U.S. housing market where someone buys a distressed home, pays to renovate it, then sells it for a higher price. In many cases, home flipping is designed to increase the number of available homes for sale in a given community. Sprucing up blighted homes can also raise the property values of homeowners in the neighborhood.
But some real estate professionals said flipping was tough last year because not enough homeowners were willing to let investors buy their property. Homeowners, many of whom purchased their house when mortgage rates were at 3% or 4%, have opted to stay put in fear of having to buy a new home at today's near-7% rates, they said.
Investors nationwide are struggling to find properties to flip, said Massachusetts-based Peter Souhleris, a real estate investing expert who has been flipping homes for 30 years.
"It’s a weird time because the supply has certainly dried up," Souhleris, former co-host of the A&E Networks show "Flipping Boston," said in an interview. "I think it has a lot to do with the interest rate environment.”
To be clear, home flipping has been around for decades, but the practice saw renewed vigor and popularity when television shows — including HGTV's "Flip or Flop" and "Property Brothers" — began airing over the past 15 years. The shows gave viewers a detailed look at renovating a home, including how much profit the hosts generated after a sale. Souhleris' show aired on A&E between 2012 and 2014.
Anyone looking to flip a home this year should expect similar conditions, Barber said. Investors will have to contend with "a short supply of homes for sale, declining numbers of low-priced foreclosure properties, mixed economic forecasts and elevated mortgage rates." The successful home-flipper this year "will have to do some very smart buying and quick renovating to keep the profit rebound going."
