House flipping falls to low as property taxes eat into profits – Hamptons

Research from Hamptons showed that in 2025, just 1.5% of all property transactions in England and Wales were flipped, down from 2% the year before. 

The firm said this marked a slowdown that began after the second home stamp duty surcharge was introduced in 2016. The introduction of the higher-rate tax resulted in a halving of the number of homes flipped over the last nine years – from 21,560 in 2016 to 10,570 last year. 

The stamp duty surcharge was raised from 3% to 5% in 2024, which Hamptons said further eroded the gains from property flipping. 

In 2015, the year before the second home surcharge was introduced, the gross profit on a flipped home after stamp duty was £36,500. By 2025, this fell by 55.1% to a gain of £16,390. This excludes any costs incurred in renovating the property. 

Some 73.3% of homes flipped in 2025 generated a gross profit, but after stamp duty, this fell to 58.7%. This is compared to a peak share of 85.9% of flipped homes generating a gross profit in 2009. 

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Last year, stamp duty accounted for 43% of the gross profit on a flipped home, equivalent to around £12,400. Hamptons recorded a temporary rise in profits during the stamp duty holiday, but this has since declined. 

South West takes the largest hit 

Hamptons’ data showed that the South West region was the most impacted by declining house flipping, due to weaker house price growth and higher stamp duty costs. 

In this part of England, average post-stamp duty profits have declined by 80.3% since 2015. By 2025, stamp duty accounted for 71% of the average gross profit from house flipping. 

The North East performed the strongest, with average returns of 36.4% in 2025. This was up from 27% in 2015, and the only region in England where the share of profit after paying stamp duty has risen. 

Stamp duty costs in the North East are relatively low because of the typically lower average house price, at around £6,000 for each flipped property. Stamp duty accounts for 26% of the average gross profit, compared to a stamp duty cost of £30,000 in London, representing 45.6% of profit. 

Some 27% of homes in the North East were bought for £40,000 or less and therefore incurred no stamp duty. Hamptons said that, along with strong price growth, this had supported investor activity, resulting in 3% of homes in the region being bought and resold within a year, the highest share across England. 

Hamptons found that properties priced below £100,000 were more likely to deliver a profit in 2025, with this being the case for 86% of such homes. This falls to 28% among properties worth more than £350,000. 

Additionally, properties worth less than £100,000 achieved average gains of 45.8%, while homes worth more than £200,000-350,000 saw negative returns.

Some 88.9% of all flipped properties were bought for less than £350,000. 

House flipping is no longer profitable 

Aneisha Beveridge, head of research at Hamptons, said flipping was “no longer the profitable venture it once was”.

She added: “There was a time when rundown properties could be bought cheaply, refurbished, and resold at a healthy margin. Today, however, second home stamp duty absorbs nearly half of all gross profits, significantly eroding returns. 

“The surcharge was not primarily intended to penalise ‘house flipping’; its primary aim was to support first‑time buyers. While it has largely succeeded in that goal, it has left flipping unviable across much of the South of England. These projects deliver much-needed move-in-ready homes, sparing buyers the financial risks and expertise to undertake major works themselves.” 

Beveridge said stamp duty was only part of the challenge because, although falling house prices in some markets had squeezed returns, the cost of materials and labour had also increased notably since the pandemic. 

“Even before factoring in stamp duty, refurbishment budgets now stretch much further than they once did, pushing profit margins to their thinnest levels in over a decade,” Beveridge said. 

She added: “In contrast, the North – particularly the North East – has remained far more resilient. Lower entry prices keep stamp duty bills modest, meaning more scope to add value through refurbishment. Combined with strong local house price growth, this has created a rare pocket of the country where flipping can still deliver healthy returns. 

“Unless a flip is supported by strong underlying house price growth, turning a profit is becoming increasingly difficult. That said, investing in relatively cheaper property in an area where house price growth is strong can still yield solid returns.”