Renovated homes are still a draw, but the edge is fading

"Higher mortgage rates change the math for buyers and sellers alike, said Joel Berner, senior economist at Realtor.com. Renovated homes still catch buyers' eyes, but financing the cost of those improvements at today's rates is less appealing to today's price-sensitive shoppers. That's why we're seeing the performance gap between flipped homes and other older homes shrink compared with 2021. Nationally, flipped homes closely resemble other older homes in terms of bedroom counts, bathroom counts and overall pricing."

"Renovated homes still outperform in visibility and speed. In October 2025, flipped homes generated about 6.5% more page views per listing and spent roughly 10 fewer days on the market than comparable older homes. In 2021, when mortgage rates were far lower, the gap was much wider, with flipped homes drawing 25% more page views per listing. Despite solid online interest, pricing power has weakened."

Higher mortgage rates have reduced buyer willingness to finance post-renovation costs, changing the economics for market participants. Renovated homes still attract attention, but financing improvements is less appealing to price-sensitive shoppers. Nationally, flipped homes resemble other older homes in bedroom and bathroom counts and overall pricing, with median listings near $380,000 versus about $385,000. Flipped homes are smaller, command higher price per square foot, and are more often in urban ZIP codes (40.4% vs. 32.1%). In October 2025 flipped listings had about 6.5% more page views and spent roughly 10 fewer days on market. Sold flipped homes showed an 8.3% median discount from the highest post-renovation list price, versus 2.9% for comparable older homes. Typical flips were purchased at 51.4% of metro medians and listed at 87.8% after renovation. The national Flip Factor is 36.4 percentage points.

Read at www.housingwire.com