Why Building New Construction Beats Flipping in 2025
Introduction
For the past decade, house flipping has been the go-to strategy for real estate investors chasing quick returns. But since 2020, flipping margins have steadily shrunk. Tight inventory, rising acquisition costs, and unpredictable rehab budgets are eroding profits.
Meanwhile, investors who pivot into new construction—particularly build-to-rent (BTR) and build-to-sell strategies—are finding more predictable profits, scalable opportunities, and long-term value creation.
The truth is simple: new construction is the new flipping.
Flipping in 2025: The Margins Are Thinner
According to ATTOM Data Solutions’ 2024 Home Flipping Report, the average gross profit on a flip in Q2 2024 was $72,000, just a 27.5% ROI—the lowest since 2003【ATTOM, 2024】.
Median home prices are up nearly 46% nationwide since 2020【NAR, 2024】.
Construction input costs rose 37% since 2019【BLS, 2024】.
👉 Opinionated take: Flipping has become a game of chance. Margins depend on what you don’t find behind the drywall. The dream sold by reality TV—where every flip is a payday—rarely matches reality. Most first-time flippers lose money or drown in projects beyond their skillset.
Flipping has too many risk factors. With thin margins and fierce competition, it’s simply too risky for the average return. And if we consider the true definition of investing—passive, scalable, wealth-building—flipping doesn’t even qualify.
Why New Construction Wins
1. Predictable Costs with Cost-Plus Models
In flipping, surprises eat margins. In new construction, cost-plus contracts create line-item visibility and capped fees.
At Hivesta, for example, clients see every vendor invoice inside our client platform. They can confirm that estimates, budgets, and final invoices match—removing financial guesswork.
2. Scalability
Flipping depends on finding undervalued deals—a shrinking pool.
New construction, on the other hand, allows investors to replicate models across multiple lots.
Raw land is easy to identify across Florida. Once you have a proven spec plan and team, you can scale across counties.
3. Modern Design + Higher Rents
Tenants and buyers consistently pay premiums for new builds.
According to Zillow, new-build rentals commanded 9–12% higher rents in 2024 compared to older homes【Zillow, 2024】.
With new construction, investors get true turnkey properties with minimal maintenance in the first years—plus equity built in from day one.
In today’s high-interest environment, being able to build below market value creates a crucial advantage: stronger cash flow and multiple exit strategies (rent, refinance, or sell).
4. Financing Advantages
Construction-to-perm loans, DSCR programs, and private lending options are more accessible than ever.
Many programs now allow first-time builders to qualify, often rolling interest reserves and closing costs into the loan.
Investors can seamlessly transition into long-term fixed financing, capturing appreciation from the ground up.
Case Study: Florida
38% of single-family homes sold in Florida in 2024 were new builds, the highest rate nationwide【Redfin, 2024】.
Median home prices in Florida rose 8.9% YoY, compared to just **3.3% nationally【Florida Realtors, 2024】.
1 in 5 new homes started in Florida in 2024 were build-to-rent【NAHB, 2024】.
👉 Florida isn’t keeping pace it’s setting the pace. For investors, new construction here means high demand, consistent rent premiums, and long-term appreciation.
Risks to Consider (and How to Mitigate)
Permit Delays: Some counties take 6–9 months. At Hivesta, we have in-house expeditors to accelerate revisions. Pro tip: buy your lot cash to avoid paying loan interest during permitting.
Utility Connections (FPL, water/sewer): Delays are common. Builders should schedule utility hookups at project start, not at the end.
Financing Gaps: New construction requires liquidity. While some programs reduce upfront cash requirements, investors still need reserves to cover market shifts. Work with brokers who specialize in investor-friendly products.
Opinion: The Future Is Build-to-Rent
The next five years will be dominated by investors building BTR portfolios. Flipping will exist, but as speculation. The investors who control land, build efficiently, and operate transparently will control the future of wealth creation.
As someone who has studied real estate, law, and now construction management while actively building homes, my perspective is clear: flipping belongs to the past—building new belongs to the future
Conclusion
If you’re still chasing flips in 2025, you’re already behind. Smart investors are moving into new construction—where scalability, transparency, and long-term returns are not only possible, but repeatable.
Sources
ATTOM Data Solutions, Q2 2024 Home Flipping Report
National Association of Realtors, 2024 Housing Report
U.S. Bureau of Labor Statistics, Producer Price Index (Construction Inputs, 2019–2024)
Zillow Rental Market Report, 2024
Redfin Housing Market Data, 2024
Florida Realtors, 2024 Market Statistics
National Association of Home Builders, 2024 Build-to-Rent Trends
Image Recommendations (for your team to use on the website)
Hero Image (Header): A modern new-construction home under construction (framed structure or brand-new finished house).
Data Graphic: A chart comparing flipping ROI vs. new construction ROI (can be branded with Hivesta colors).
Florida Market Map: Highlight counties with the highest percentage of new builds.
Financing Visual: A simplified flow graphic of “Lot → Build → Refinance or Rent.”
Closing Section Image: A family or investor standing in front of a just-finished new construction home.