Home flipping profits have crashed to their lowest levels since the 2008 financial crisis, as surging property acquisition costs eat into investor margins across the United States.
The typical gross return on investment for home flippers dropped to just 25.1% in the second quarter of 2025, the weakest performance since Q2 2008, according to ATTOM’s latest U.S. Home Flipping Report.
The decline marks a dramatic fall from the 62.9% profit margins investors enjoyed at the peak of the post-crisis flipping boom in 2012.
Approximately 78,600 single-family homes and condominiums were flipped during the second quarter, representing 7.4% of all U.S. home sales.
The World Property Journal reported that while this figure declined from 8.3% in the first quarter, it remained close to the 7.5% recorded in the same period last year.
“The initial buy-in for properties that are ideal for flipping, often lower-priced homes that may need some work, keeps going up,” said Rob Barber, CEO of ATTOM.
“As prospective homeowners get priced out of the middle and high end of the market, they’re more likely to be competing with flippers over the same homes.”
The median purchase price for flipped properties reached $259,700* — the highest level in ATTOM’s records dating back to 2000.
Meanwhile, the median resale price held steady at $325,000, leaving typical investors with a gross profit of $65,300.
This represents a 4% decline from the first quarter and a 14% drop compared to the same period last year.
While flipping activity contracted in 86% of metro areas analysed, Georgia stood out as a national leader.
Among major metropolitan areas, Birmingham, Alabama (11.8%), Cleveland, Ohio (11.2%), and Columbus, Ohio (10.5%) achieved double-digit flipping rates.
In contrast, Seattle, Washington (4.1%), Boston, Massachusetts (4.8%), and Honolulu, Hawaii (5%) showed the weakest activity.
Profit margins vary dramatically by market
Despite the national decline, some markets continued to deliver exceptional returns.
Pittsburgh topped the profitability rankings with a 107% gross margin, followed by Shreveport, Louisiana (104.2%) and Scranton, Pennsylvania (104.1%).
Among larger metros, New Orleans (78.1%), Baltimore (75.5%), and Memphis (70.6%) posted notable returns.
However, Texas markets struggled significantly, with Austin offering just 5.5% returns, San Antonio at 7.7%, and Dallas at 9.3%.
The profit erosion was widespread, affecting more than half of all metro areas.
The sharpest quarterly declines occurred in Fort Smith, Arkansas (ROI dropping from 76.3% to 13.1%), Green Bay, Wisconsin (70.1% to 19.3%), and Clarksville, Tennessee (65.5% to 26.2%).
Market outlook
The data paints a challenging picture for real estate investors as the once-lucrative house flipping market faces unprecedented margin pressure.
With acquisition costs at record highs and resale prices flattening, the easy profits that characterised the post-financial crisis era appear to be over.
While Georgia continues to serve as the epi-center of flipping activity, the broader national trend suggests investors must adapt to a new reality of thinner margins and increased competition from traditional homebuyers priced out of higher-end markets.
*All prices in USD
