Real estate investors flipping homes are seeing their profits drop considerably as higher mortgage rates, high home prices and tight supply squeeze profit margins.
Diana Olick, senior real estate correspondent at CNBC Property Play, says home flippers are seeing their smallest profits since the since the 2007-2009 recession.
“In all of 2025, roughly 297,000 single-family homes and condos were flipped nationwide, according to ATTOM, a real estate data provider, which defines a flip as a home purchased and sold in the same 12-month period. That was a decrease of 3.9% from 2024 and the lowest number of flips in any year since 2020. Investor flips accounted for 7.4% of all 2025 home sales, down from 7.6% in 2024,” Olick reports.
With the backdrop of the highest median home prices on record, the typical home flip netted investors just $65,981 in gross profit, or a 25.5% return on investment, according to ATTOM. That is down from 32% the prior year and the lowest rate since the Great Recession in 2008.
“Competition for homes remains strong in many markets due to constrained supply,” said Rob Barber, CEO of ATTOM, in a release. “With prices staying elevated, investors are finding it harder to secure deals that deliver strong returns.”
For comparison, in the boom decade following the financial crisis, profit margins were higher than 50%, peaking at 61% in 2012, which is around when home prices bottomed.
Net profits, or investor returns that factor in the cost of fixing up the property, can vary widely depending on local labor, material and financing costs. Across the U.S., however, the cost of fixing properties before flipping remains elevated due to ongoing supply chain pressures and tariff-related increases in material prices, which continue to compress investor margins, according to ATTOM.
