US Home Flipping Profits Shrink, But Buffalo and Pittsburgh Outperform

Nationwide, home flippers are experiencing a decline in profits, with the typical flip yielding $60,526 before expenses in the second quarter of 2026, a decrease from $71,000 a year prior, according to a report from real estate data firm ATTOM. This represents a return of 21.5% on investment, down from 27.6% a year ago, and these figures do not account for renovation costs, closing expenses, or other associated fees.

National Trends and Challenges

The shrinking profit margins reflect a broader trend over the past two years, with the typical return narrowing. This shift contrasts with previous years when soaring home prices made flipping a seemingly straightforward path to profit. Current market conditions, characterized by high home prices and cautious buyers, leave investors with less room for quick financial gains. Nationally, the number of flipped homes has also decreased, with 77,991 homes flipped in the second quarter, accounting for 6.2% of all home sales, down from 7.3% in the same period last year.

Northeastern Markets Show Strength

Despite the national downturn, certain metropolitan areas continue to offer robust returns for house flippers. Buffalo, New York, stands out as a particularly profitable market, delivering a 76.6% return on the typical flip. This performance ranks Buffalo as the second-highest among major metropolitan areas with populations exceeding one million. Factors contributing to Buffalo's success include relatively affordable housing, a competitive market, and an influx of professionals and remote workers attracted by its diversifying economy, which has expanded beyond its industrial roots into sectors like healthcare, education, technology, research, and financial services. The city's median home sale price in September was approximately $233,000, about 42% below the national average, with nearly 60% of homes selling above their asking price.

Pittsburgh led the nation with an impressive 81.5% return, followed closely by New Orleans at 75%, Virginia Beach at 63.4%, and Philadelphia at 62.8%.

Texas Markets Face Significant Challenges

In contrast, house-flipping ventures in Texas are facing considerable difficulties. San Antonio was the only major metro area where the typical flip resulted in a financial loss, with investors seeing a negative 0.3% return. Dallas reported a modest 1.8% return, while Austin posted 2.8%, and Houston managed only 3.7%. These low returns are occurring in a challenging selling environment across Texas, where buyer advantages are evident. In July, Houston, San Antonio, Austin, and Dallas all experienced a surplus of sellers over buyers, with many sellers resorting to price reductions and incentives to compete with the market's ample supply of new construction.

Market Dynamics and Investment Tiers

The profitability of home flipping appears to be influenced by the price point of the properties. Homes purchased for between $100,000 and $200,000 generated the strongest returns nationally, averaging 28%, followed by properties bought for $200,000 to $300,000, which yielded an average of 26%. Conversely, investors who acquired properties for $50,000 or less experienced an average loss of $15,000 per resale, suggesting that the cheapest fixer-uppers may not always be the most profitable.

Despite the narrowing margins, the speed of transactions has slightly improved, with the typical flip taking 161 days from purchase to resale, down from 166 days a year earlier. However, this increased speed has not offset the overall decline in profits.