"Stamp duty bills now account for nearly a third of gross profits. And in some cases, these bills are now higher than the cost of renovating the property"
- Aneisha Beveridge - Hamptons
The number of homes being flipped in England and Wales has fallen to its lowest level in over a decade, as higher stamp duty bills eat into investor returns and force flippers to retreat from pricier southern markets.
In Q1 2025, just 2.3% of homes sold had been bought within the previous 12 months, marking the lowest flipping rate since 2013 and a sharp decline from 3.6% during the same period last year. In absolute terms, 7,301 flipped homes were sold, nearly 3,000 below the 10-year Q1 average.
While the average gross profit from a flipped property rose to £22,000—up £6,000 year-on-year—this still represents a steep drop from the £38,000 peak recorded in 2022. The typical return has been eroded by both cooling house price growth and a shift towards flipping cheaper properties, particularly in the North and Midlands.
The picture becomes even more challenging when accounting for stamp duty. In Q1 2025, the average investor paid £6,375 in stamp duty on a flipped property, up 236% from the £1,900 average just a decade ago. As a result, stamp duty now swallows around 21% of the average gross profit, more than double the proportion in 2015. And following changes to SDLT rules in April 2025, the average bill for someone flipping a home today has jumped to £11,920—equivalent to 30% of the typical gross profit and payable before any renovation costs are factored in.
This financial squeeze has pushed average net profits down to £12,000 this year, a modest improvement from £7,000 in Q1 2024, when prices were falling, but still less than half of the £28,500 net returns flippers could expect a decade ago. Net yields have also dropped, now averaging just 7% versus 16% in 2015.
Only 66% of flipped properties sold in Q1 2025 turned a profit once stamp duty costs were taken into account, even though 80% sold for more than they were purchased for. Under the current SDLT regime, only 59% of flips would have yielded a profit, matching lows last seen during the 2009 financial crisis. Factor in rising renovation costs and falling prices in some areas, and the viability of flipping becomes even more strained.
Despite these pressures, the North East has remained a rare bright spot for property investors. Here, flipped homes made up 4.7% of all sales in Q1 2025—more than double the national average. Redcar and Cleveland emerged as the top local authority for flipping, overtaking Hartlepool, with Burnley dropping out of the top three for the first time in a decade.
One of the key drivers behind the North East’s dominance is affordability. Around 11% of homes flipped in the region this year were bought for less than £40,000—a price threshold below which no stamp duty is payable. Nationally, just 2% of flipped homes were purchased below this level. Across all sales, 87% of homes bought under £40,000 turned a profit after flipping, compared to the overall average of 66%.
Meanwhile, the South continues to see a sharp retreat in flipping activity. London posted the lowest flipping rate in the country, with just 1.5% of homes resold within a year, down from 3.2% a decade ago. In the capital, stamp duty accounted for 23% of the average gross profit, and investor returns now average just 8% after paying around £33,000 in tax.
Only two southern local authorities—Great Yarmouth and Torridge—made it into the top 20 for flipping activity this year. Just ten years ago, neither had cracked the top 30.
“Bigger stamp duty bills are wiping out a lot of profit from flipping," explained Hamptons' head of research, Aneisha Beveridge. "The 5% surcharge for investors, coupled with a reduction in the point at which buyers start paying stamp duty, means it’s harder than ever to make the sums stack up.
“Stamp duty bills now account for nearly a third of gross profits. And in some cases, these bills are now higher than the cost of renovating the property. This, together with rising material and labour costs and, in some places, falling house prices, makes flipping homes an increasingly tricky business.”
She added that the stamp duty surcharge, introduced in part to favour first-time buyers over investors, has indeed shifted the balance, but not without consequences.
“These rising upfront costs have pushed investors further North, where properties can still be bought without paying any stamp duty. While the returns aren’t as high in cash terms, higher yields and lower tax bills continue to make the North the homeland of flipping.”
