Fix-and-flip Market Struggles In Q2 Due To Labor, Material Challenges

The fix-and-flip market is showing signs of weakening, according to a Q2 2025 Fix-and-Flip market survey from Kiavi and John Burns Research & Consulting, released on August 7.

The Burns and Kiavi Fix and Flip Market Index (FFMI) is based on a quarterly survey of about 400 fix-and-flippers nationwide. The index scale ranges from 0 to 100, with below 50 equaling contracting and above 50 equaling expanding.

The index fell slightly to 57 in Q2 2025 from 58 in Q1 2025. Results are more negative than this time last year, when the index was 63.

The flipping market, in short, has become more difficult for flippers to achieve profitability and speed. Days-on-market for flipped homes are increasing as resale and new inventory rise, according to 53% of flippers.

Immigration enforcement has also an impact; Nationwide, 33% of flippers cited reduced labor availability due to immigration enforcement. Flippers note mostly indirect impacts, including fear-driven absences from job sites.

“My repair guy is worried. He doesn’t work every day, and sometimes, he stays home for safety. This has delayed progress on my last flip home,” one Florida flipper submitted to the survey.

Flippers in areas like Southern California (50%) noticed the change in labor availability more than the nationwide average.

“It’s been tough to find good workers due to ICE activity, and buying material became very difficult since [workers] can’t go to Home Depot,” one Los Angeles-based flipper wrote.

As a result of constricted labor and a tepid housing market, just 30% of flippers reported good sales in the second quarter compared to the seasonal norm, down from 38% year-over-year. In California, Florida, Texas and the Southwest, 20% of more flippers reported poor sales.

The current availability of pre-flip homes to purchase index fell to 59, the lowest level in survey history. Falling ratings reflect how rising resale inventory is beginning to ease competition for deals nationally.

Competition is intense in areas like California due to markets with older housing stock and the fact that inventory hasn’t grown like it has in the Sunbelt. Flippers find easier buying conditions in Texas and the Southwest.

Profits and pricing

The survey found that West Coast regions see the highest average flipped home prices, led by Northern California at over $1.3 million. Kiavi and John Burns say this is due to expensive and structurally undersupplied Northern California markets, such as San Francisco, San Jose, and the East Bay, which are driving higher flipped home prices.

Just 15% of flippers saw flipped homes come in mostly above after-repair value (ARV) over the last 12 months, the lowest level in survey history. In conjunction, the average renovation cost for a flipped home rose to $76K in 2Q25, the highest in the survey’s history as well.

Financially viable deals are hard to come by with tight capital conditions and a high-interest rate environment, the survey said. Flippers paid an average of 9.5% interest on loans that they secured for flipping in the second quarter.