Fix and Flip Trends in 2025: Best Home Flipping Markets & Insights

If you are a residential mortgage broker, commercial mortgage broker, small private lender, or referral partner, you understand how critical it is to remain ahead of the curve in the real estate game. The fix and flip market is still a stable and profitable niche, and gross profits on average flips increased to around $73,500, as reported in a new report by ATTOM. This steady growth provides an ideal window of opportunity for investors who wish to maximize profits, and as a financing ally, you have an important part to play in bringing these transactions into reality.

Renovating an older or rundown property into a sought-after home can also generate a neat profit for investors. If your client is undertaking a fix and flip for their next venture, it is beneficial to have some sense of the general market trend for this asset class.

One major factor driving this market is the persistent housing shortage,  which stands at 4.5 million units and continues to grow. While national builders are increasing new home construction, what they build tends not to respond to decaying housing inventory or the necessity for higher density in infill locations.

But what does the future look like for the fix and flip market? What trends should you and your clients be observing as we venture into 2025 and beyond? In this blog, we'll dissect the largest trends influencing the real estate flipping market and how you can assist your clients in taking advantage of them. Let's get started!

1. Shift in Buyer Preferences: Demand for Functional and Eco-Friendly Spaces

Among the largest trends within the real estate flipping space is the increase in demand for sustainable and useful features. House hunters today expect not only a home that can be moved in, but a house that also is energy conscious and technologically advanced.

• Eco-Friendly Upgrades: Attributes such as energy-efficient units, smart thermostats, and solar panels no longer qualify as a nice-to-have, but are a need-to-have. Such improvements may cut down homeowners' utility expenses and make their homes more marketable.
• Smart Home Technology: Smart locks, lighting, and security systems are becoming the norm in new homes. These are relatively cheap to install but can really enhance a property's marketability.

How You Can Help: Get your clients to invest in these upgrades. Not only will they add value to the property, but they'll also make it easier to get financing, as lenders are more and more looking for sustainable investments.

2. Shifting Demographics: Catering to Millennial and Gen Z Buyers

Millennials and Gen Z have become the largest demographic of homebuyers, and their demands are transforming the fix and flip market. Their demand is for homes that are move-in ready, fashionable, and full of state-of-the-art amenities.

• Move-In Ready Homes: Young buyers don't like repairs or renovations. They're searching for homes that are renovated and move-in ready.
• Affordable Luxury: Luxuries such as quartz countertops, hardwood flooring, and open-concept homes are top choices but don't necessarily need to come at a high cost.

How You Can Help: Work with your clients to find homes that can be repurposed into move-in properties. Emphasize the value of current design trends and economical upgrades appealing to young buyers.

3. Rising Material and Labor Costs: Preparing for Budget Adjustments

One of the most daunting issues facing the fix and flip industry is increased labor and materials costs. Disruptions to the supply chain and inflation have resulted in increased prices, leaving it more difficult for investors to budget. 

• Budgeting Tips: Encourage clients to request bids from multiple contractors and procure materials in their immediate area to help save on expenses.
• Negotiation Strategies: Assist your customers in negotiating lower prices with contractors or obtaining complimentary upgrades, such as higher-end appliances or finishes.

How You Can Help: Provide financing options that take into consideration these increased expenses. Adjustable loan terms can assist your customers in staying within budget and keeping their profits to the maximum.

4. Tightening Credit Markets: The Rise of Private Lending Solutions

Conventional lenders are reluctant to finance fix and flip projects because they perceive them as risky. That's where private lenders enter the picture.

• Faster Approvals: Private lenders can quickly approve loans, enabling your clients to act swiftly on profitable opportunities.
• Flexible Terms: Interest-only loans and shorter loan terms can enable investors to optimize their cash flow.

How You Can Help: Partner with private lenders like RCN Capital to provide your clients with the financing they require to thrive. Emphasize the advantages of asset-based loans, which are simpler to qualify for and customized for real estate investors' needs.

5. Increased Focus on Technology: Digital Tools and Virtual Property Tours

Technology is revolutionizing the fix and flip space, making it more convenient than ever before to analyze properties, project manage, and promote listings.

• Project Management Tools: Software like Buildertrend or CoConstruct can help your clients stay on budget and schedule.
• Virtual Tours: Virtual staging and 3D tours can make listings more attractive to buyers, particularly in competitive markets.

How You Can Help: Introduce your clients to these tools and demonstrate how technology can streamline their operations and increase their profits.

6. Regional Market Variations: How to Target the Best Flipping Markets

Not every market is the same. Certain markets have a potential to grow, whereas some are too saturated.

• Key Indicators: Opt for those markets that demonstrate a high growth population, growing home prices, and a well-employment record.
• Up-and-Coming Neighborhoods: Homes in desirable areas with schools of good standards, amenities, and transport hubs will always remain popular.

How You Can Help: Utilize data aggregators such as ATTOM Data or Realtor.com to determine the best flipping markets for your clients. Provide this information to them so that they can make educated decisions.

7. Regulatory Changes: Staying Compliant in a Changing Landscape

Regulations are constantly evolving, and staying compliant is crucial for fix and flip investors.

• Permits and Zoning: Make sure your clients secure all necessary permits before starting a project.
• Local Laws: Stay up to date on zoning laws and building codes in your area.

How You Can Help: Connect your clients with real estate attorneys or compliance experts to ensure their projects meet all legal requirements.

How Brokers and Lenders Can Add Value

As a third-party originator or wholesale partner, your role goes beyond just securing financing. Here are a few ways you can add value for your clients:

1. Educate Them on Market Trends

Share insights on the latest fix and flip trends and help your clients adapt to changing market conditions.

2. Offer Flexible Financing Options

Provide financing solutions that meet your clients’ unique needs, whether they’re flipping a single-family home or a multifamily property.

3. Connect Them with Reliable Contractors

A strong network of contractors and vendors can help your clients stay on budget and complete projects on time.

Why Partner with RCN Capital?

At RCN Capital, we specialize in providing financing solutions for real estate professionals, including residential mortgage brokers, commercial mortgage brokers, and small private lenders. Our flexible loan options are designed to help your clients succeed, whether they’re investing in a single-family home or a multifamily property.

By partnering with RCN Capital, you’ll have access to:

• Competitive interest rates
• Fast approval and funding
• Expert guidance throughout the process

If you’re ready to take your partnership to the next level, connect with RCN Capital today. Together, we can help your clients thrive in the competitive world of real estate flipping.