2025 Fix & Flip Trends: What's Working Right Now?

Question

Hello Everyone!

Flippers are navigating rising rehab costs from tariffs (up 10-15%) by focusing on local materials and eco-friendly upgrades that boost ARV by 8-12%. Median gross profits hold at ~$73,500 per deal, with hot markets like Fayetteville, AR offering 25%+ spreads and quick sales under 30 days. Demand stays strong for millennial/Gen Z features—move-in ready kitchens with large-format tiles, custom vanities, and energy-efficient tech—while private lending fills the gap from tight bank credit.​

89% of flippers plan at least one deal this year, but competition varies (high in CA, low in TX). Many are shifting some flips to rentals amid stabilizing FFMI at 57.​

What's your 2025 strategy? Q4 cost-saving tips? Best markets or design hacks? Drop your thoughts below—let's share intel!

Andy Sabisch · Answer

As Peter said, you make money on the BUY and not on the SALE.  If you do not buy right, ensure your estimates are solid, have solid exit strategy defined, understand where the local market is going and have a contingency in your plans, you will come up short on the back end.  There have been multiple posts here recently from investors that missed one of these and are now up against the wall with HMLs coming due and no equity to work with.  Over the years we have held to this formula and at the end, we may have left some money on the table but we have gone under contract within 2 weeks of putting it on the market.  Much better to be in this case and make money than be sitting there biting our nails as loans come due and no buyers are in the wings.

Peter Mckernan · Answer

I do not think it's the rehab costs that make or break these deals these days. It is buying right.. the costs for rehab have been about the same in my experience for about the past 18-24 months with inflation on everything. The things that are getting fix and flippers in to trouble are long days on market where holding costs create a smaller profit or something less than expected.. The other issue for flippers is not really being tight on their initial numbers and comps. People might think of the 70% rule when you talk about this.. So if we are going off this as a baseline, you really need to be only buying stuff at a 50% rule or 55% rule max.. This will help you with holding costs that are higher than normal (not rehab costs), and a smaller out price compared to the next guy that sold for $5-$10K over that last comp.. The old way to go about it was, John sold for $350,000, and well ours is fully remodeled and we can sell for $355,000 or $360,000.. Now it is; John sold for $350,000 let's list for $340,000 or $345,000 max.