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As housing affordability challenges persist and housing inventory remains tight, regional new construction trends offer a window into where there are still investment opportunities for fix and flippers. Rising permit activity points to strong demand and price appreciation, which is great for fix-and-flip real estate investors. However, supply-constrained markets in the Northeast can also offer unique, high-ROI opportunities despite low permit activity. That’s why LendingOne analyzed monthly housing permit data from the U.S. Census Bureau’s Building Permit Survey to see where single-family permit activity is ramping up—and where it is pulling back. These are our key findings: U.S. Housing Permit Activity: The 2025 Outlook March U.S. single-family housing permit activity remains above pre-pandemic levels, with permits in March 2025 up 21% from March 2019, and slightly below (-0.8%) March 2024 levels. However, U.S. single-family housing permit activity has still fallen -24% since 2021. Primary markets in the South continue to see the most single-family permits overall, but secondary markets across the Southeast, as well as some of the largest U.S. metros, have seen permit activity ramp up significantly over the last year. ✅ Fix and Flip Insight: Rising permits typically signal strong market interest and price appreciation, giving flippers a chance to ride momentum—especially in growing Southeast cities. Little Rock, Arkansas, saw a 175% year-over-year growth in single-family permit activity—the highest of any U.S. metro that issued at least 200 single-family permits in March 2025. U.S. Housing Permit Activity: The 2025 Outlook While new construction remains significantly below March 2021 levels, the latest data shows that even in the face of strained affordability, permit activity has stayed resilient. That being said, trends vary a lot by market. Top 10 U.S. Metros Where Permits Are Growing Fastest Among the housing markets that issued at least 200 single-family housing permits in March 2025, these cities led the nation in year-over-year growth: Little Rock, AR: +175% Jacksonville, NC: +54.9% Savannah, GA: +48.5% Winston-Salem, NC: +46% Oklahoma City, OK: +39.5% New York-Newark-Jersey City, NY-NJ: +38.6% Hickory, NC: +30.9% Birmingham, AL: +30.8% Greensboro-High Point, NC: +30.5% Knoxville, TN: +26% 🛠️ Fix and Flippers should take note of these fast-growing areas. Increased permits often correlate with buyer demand and neighborhood revitalization—both favorable conditions for profitable flips. Markets With the Biggest Permit Declines On the flip side, these metros saw the sharpest year-over-year declines in permit activity: Deltona-Daytona Beach-Ormond Beach, FL: -38.0% Jacksonville, FL: -37.3% Lakeland-Winter Haven, FL: -31.3% Salt Lake City-Murray, UT: -28.4% Punta Gorda, FL: -23.1% Virginia Beach-Chesapeake-Norfolk, VA-NC: -21.7% Hilton Head Island-Bluffton-Port Royal, SC: -20.6% Atlanta-Sandy Springs-Roswell, GA: -20.1% Washington-Arlington-Alexandria, DC-VA-MD-WV: -20.0% North Port-Bradenton-Sarasota, FL: -18.2% 🏘️ Fix and flip investors in these markets may benefit from less new construction competition, potentially increasing resale opportunities for rehabbed homes. Southern Secondary Markets Lead in 2025 Secondary markets in the South are taking center stage in 2025, with four North Carolina metros landing in the top 10 for biggest year-over-year permitting increases. These smaller cities often offer lower acquisition costs and growing populations—two crucial ingredients for successful fix and flip projects. Why Fix and Flippers Should Watch Permit Trends Home flippers should pay attention to housing permits as they provide valuable insights into future market conditions. An increase in single-family permits typically means more homes will be built, which could increase local inventory competition—something flippers want to keep an eye on when selling. For instance, when and where needed, builders aren’t afraid to roll out big incentives to move product. Tracking permit trends can also help fix and flip investors: Identify emerging neighborhoods Avoid areas at risk of overbuilding Spot rising renovation permit activity (a sign of investor competition) 📊 Overall, monitoring permits helps flippers make smarter decisions about timing, pricing, and location. Why Low-Permit Markets Can Be Gold for Flippers Some markets, particularly across the Northeast, have strict development regulations or simply lack space to build new homes, suppressing permit activity levels. This paired with strong demand means flippers in these markets have a particular edge. According to LendingOne’s analysis, while competition is high, these are the types of markets where flippers are seeing the highest ROI right now. Year-Over-Year Changed in Single Family Housing Permits By Metro High-Volume Markets: Where Builders Are Active In terms of volume, these metros issued the most permits for single-family homes in March 2025: Houston, TX: 4,709 Dallas, TX: 3,810 Phoenix, AZ: 2,372 Atlanta, GA: 2,130 Charlotte, NC: 1,622 Texas markets remain leaders in new construction, despite rising resale inventory and slight price corrections. For example, even with Houston home prices sitting -3.8% below their 2022 peak, according to the Zillow Home Value Index, permit activity still ticked up +0.2% year-over-year. 🔍 For flippers, this means keeping a close eye on how builders are pricing and positioning their homes. Single Family Housing Permits Authorized in March 2025 Fix and Flip Opportunities in Dense Coastal Cities Notably, both New York City and Los Angeles have seen a substantial jump in single-family permitting, indicating opportunities to buy, renovate, and resell homes in areas where new construction has traditionally been limited. Year-Over-Year Growth in Single Family Permit Activity These markets often come with high acquisition costs but can also offer big returns if flippers find the right property in the right neighborhood. The Bottom Line for Fix and Flippers in 2025 Big picture: While single-family permit activity is no longer booming like it was during the Pandemic Housing Boom, it’s still holding steady on a national basis. Fix-and-flip investors who are competing directly with homebuilders—meaning they’re selling a similar product to a similar buyer in the same area—will need to stay on their toes, given how constrained affordability is in today’s housing market.

Market Softness Brings Opportunity As we head deeper into 2025, the real estate landscape continues to evolve. Investor sentiment is mixed—part optimism, part hesitation. And frankly, that’s understandable. Inventory is creeping up, buyer urgency is softening, and certain pockets of the market feel like they’re in a holding pattern. But for adaptable investors, this period could offer the best entry points we’ve seen in years.  That may not sound exciting on the surface, but for investors with capital, patience, and a solid strategy, this type of market tends to reward consistency over speed. To help cut through the noise and identify the signals that truly matter, I’ve outlined five crucial aspects of the current real estate environment that every investor should know. 1. Inventory For Sale is Rising After several years of breakneck price growth and ultra-low inventory, we’re entering a healthier—if slower—market cycle. We’re finally seeing inventory levels normalize in some markets—especially in the former boomtowns in the Sun Belt.  Properties are sitting a bit longer, sellers are negotiating again, and the power dynamic is beginning to shift in more markets. Days on market are ticking up. Home price growth and rent growth have cooled or plateaued in many metros. For investors, this is welcome news. Why? Because the past few years have made it tough to source value-added deals. Now, with the pace of resale activity subdued, properties are sitting a bit longer—and investors have a real chance to negotiate again. Whether you’re a flipper or a buy-and-hold operator, this rebalancing opens doors that were closed during the frenzy. 2. Opportunity in Softness: Why Some Weakness May Be Bullish It’s also worth remembering that real estate markets don’t move in straight lines. Periods of cooling often set the stage for the next leg up. Investors who can stomach short-term uncertainty may find themselves well-positioned when the cycle turns. Active housing inventory for sale continues to rise, especially in the Sun Belt metros, where higher inventory is giving savvy investors more leverage at the negotiation table—and more room to underwrite conservatively. The ongoing growth in inventory is driven by strained affordability and rate-induced sluggishness. The fundamentals remain intact—the long-term outlook for rents and demographics is still supportive. This is just a market recalibration. And those who view it through that lens may come out ahead. 3. Be Mindful of Builder Competition If you’re flipping or leasing homes near active new-home communities, tread carefully. Builders—who’ve seen their inventory of completed unsold homes jump—have affordability advantages you don’t. They can offer big rate buydowns, closing cost incentives, and sometimes eat significant price cuts to move product. Say you’re planning to list a renovated home for $350K in a school district where a builder is also marketing new construction at $350K to $375K. If your end buyer is rate-sensitive, they may opt for the new build—especially if the builder is throwing in sweeteners. It’s crucial for investors to avoid direct competition with a national builder’s incentive budget. Knowing the market, understanding comps, and focusing on product differentiation can help navigate this landscape. 4. Stay Disciplined on Tenant Quality There’s growing chatter about the broader economy softening. Whether or not we enter a true downturn, it’s worth noting that consumer confidence is fragile—and that matters when you’re underwriting tenant risk. Lower-income households, in particular, are showing more strain. Credit card delinquencies are up.  This environment means staying disciplined on your screening, being conservative on your underwriting, and planning for contingencies if rent growth slows or turnover rises. 5. Adaptability Remains Your Greatest Asset No, I don’t think the average 30-year fixed mortgage rate will return to 4.0% anytime soon. And no, we won’t see the price appreciation that defined 2020–2022. But that doesn’t mean the opportunity is gone—it just means the playbook is different.  For years, this asset class rewarded speed. Now, it’s rewarding discipline and adaptability. That means thinking creatively about acquisitions (bulk deals, off-market leads), getting sharper on your renovation budgets, and being intentional with your portfolio strategy. The investors who thrive in this next phase won’t be the ones waiting for yesterday’s market to return. They’ll be the ones who adjust their approach and find upside in today’s more balanced—but still very investable—landscape.

The U.S. rental market has cooled off since the red-hot heights of the Pandemic Housing Boom when national multifamily rents surged +16.4% and single-family rents jumped +13% year-over-year in the early months of 2022. However, the slowdown has not been uniform. Last year, many U.S. rental markets saw multifamily rent growth continue to lag behind single-family rental growth, with some regions even seeing outright declines. Early data for 2025 suggests this trend is continuing.  According to LendingOne’s analysis, nationally aggregated multifamily rents rose +2.7% year-over-year in January 2025, while single-family rents climbed +4.4%.  This growth gap indicates that demand for single-family rentals remains elevated, while multifamily rent growth faces more downward pressure—with the strength of this trend varying greatly by market.  To see which multifamily and single-family rental markets have seen the most rent growth in the last 12 months, LendingOne analyzed data from the Zillow Observed Rent Index (ZORI). Using the ZORI time series data, LendingOne analysts calculated the year-over-year shifts in rent for single-family and multifamily properties by metro area. Top-line findings from LendingOne’s latest rent analysis: Single-family rental growth, while subdued compared to the Pandemic Housing Boom days, continues to outperform multifamily rental growth across most U.S. markets.  Small and mid-sized markets in the Northeast and Midwest are seeing the strongest rental growth—for both multifamily and single-family properties. The weakest rental markets are concentrated in the Southeast, with markets like Austin, Cape Coral, and San Antonio experiencing outright multifamily rent declines since January 2024.   National Rent Change: 12-Month Shift   Change in Metro-Level SFR Rents Between January 2024 and January 2025     Top Metros for Single Family Rent Growth Among the 200 largest metros with sufficient data, these are the 20 metros with the highest single-family rent growth from January 2024 through January 2025: Atlantic City, NJ: +14.4% Manchester, NH: +10.9% Reading, PA: +10.4% Huntington, WV: +9.7% Salinas, CA: +9.6% Santa Cruz, CA: +9.6% Flint, MI: +9.4% Green Bay, WI: +9.3% Kalamazoo, MI: +9.1% Evansville, IN: +9.0% Norwich, CT: +8.3% Topeka, KS: +8.1% Fort Smith, AR: +7.9% Salisbury, MD: +7.7% St. Louis, MO: +7.7% Cleveland, OH: +7.6% Charleston, WV: +7.6% Santa Maria, CA: +7.4% Youngstown, OH: +7.4% Merced, CA: +7.2% Atlantic City, NJ stands out as the strongest single-family rental market, with a remarkable year-over-year rent growth of +14.4%. Many of the city’s Northeastern neighbors, including Manchester, NH (+10.9%) and Reading, PA (+10.4%), join it at the top of the ranks. This region is strong due to tight housing inventory, limited new construction, expensive neighboring cities, and home price appreciation pushing up rental demand. The Midwest is also performing well, with cities like Flint, MI (+9.4%) and Kalamazoo, MI (+9.1%) seeing strong single-family rent growth. The region’s relative affordability and increasing demand for rental properties as more people seek budget-friendly housing options amid rising homeownership costs puts upward pressure on rent growth.  Notably, select areas in California are seeing strong single-family rent growth as metros like Salinas (+9.6%) and Santa Cruz (+9.6%), due to limited housing supply and high demand.   Change in Metro-Level Multifamily Rents Between January 2024 and January 2025 Top Metros for Multifamily Rent Growth Among the 200 largest metros with sufficient data, these are the 20 metros with the highest multifamily rent growth from January 2024 through January 2025: Reading, PA: +12.8% Atlantic City, NJ: +12.0% Lynchburg, VA: +9.5% Erie, PA: +9.1% Duluth, MN: +9.0% Hartford, CT: +8.8% Shreveport, LA: +8.6% South Bend, IN: +8.6% Worcester, MA: +8.5% Tuscaloosa, AL: +8.3% Salinas, CA: +8.2% Bremerton, WA: +8.1% Bridgeport, CT: +8.0% Fayetteville, AR: +8.0% Peoria, IL: +7.9% Montgomery, AL: +7.8% Norwich, CT: +7.8% Charleston, WV: +7.8% Jackson, MS: +7.8% Lansing, MI: +7.7% The Northeast and Midwest are home to the strongest markets for year-over-year multifamily rent growth. Reading, PA leads with +12.8% year-over-year rent growth, followed by Atlantic City, NJ (+12.0%) and Lynchburg, VA (+9.5%).  Meanwhile, the weakest rental markets—for both multifamily and single-family rent growth—tend to be those that overheated during the pandemic boom times. In metros across Texas, Florida, Colorado, and Utah, a large wave of new apartment and single-family construction was delivered in 2023 and 2024, largely driven by multifamily projects and a homebuilding frenzy financed during the period of ultralow interest rates. Some of the downward pressure on rents in these markets could ease as more new inventory is absorbed.  That being said, even in the softer rental markets, single-family rental growth is still faring better than multifamily with 26 metros seeing outright declines in multifamily rents from January 2024 to January 2025, versus only two markets seeing single-family rents drop in that time, according to LendingOne’s analysis.  Big Picture: This year is positioned for another year of single-family rent growth outpacing multifamily rent growth in both the strongest rental markets in the Northeast and Midwest, as well as softer markets across Texas and Florida, where new construction has put downward pressure on rent growth.    Note: The ZORI index is a repeat-rent index that tracks typical market rates by averaging listed rents in the 35th to 65th percentile range, weighted to reflect the full rental housing stock rather than just current listings.