All Forum Posts by: Mitch Smith

Top Renovation Trends for 2025:

Renovating homes isn’t just about updating spaces—We have found that it is about creating a lifestyle that resonates with today’s buyers. As we move into 2025, these trends are shaping how we approach renovations:

1. Open Floor Plans with Purpose: Open concepts remain a top priority, but it’s no longer just about tearing down walls. Today’s buyers want spaces that flow naturally and maintain functionality. We focus on layouts that feel spacious but still define distinct areas for living, dining, and entertaining.
2. Flow is Everything: A home’s design should feel seamless. By reimagining layouts, we improve functionality while enhancing the overall aesthetic. We pay close attention to how people move through the space, creating homes that feel effortless to live in.
3. Outdoor Spaces That Shine: In San Diego, outdoor living is non-negotiable. Buyers want patios, decks, and backyard spaces that extend the home’s livable area. From adding bi-fold doors to creating outdoor kitchens, we design spaces that make the most of Southern California’s weather.

These trends not only elevate the homes we renovate but also ensure they stand out in the market. 

What trends are you seeing in your market? How are you adapting your renovations to meet buyer expectations?

@Justin Landesman OK. Thanks for the info. If it does become a sales situation, let me know. I can kick it to our retail real estate side of the house. We are well connected and I'm sure I could find you a buyer quickly.

Have a great weekend.

Mitch

Hey @Justin Landesman. I’d be curious to know what part of town those properties are in. If you want to reach out by DM, I’d be happy to share some insight. Let me know if I can help in anyway.

@John ONeill. I couldn’t agree with you more that flipping is a great strategy for 2025, especially as the market evolves. Residential development and renovation allow investors to meet the growing demand for updated, functional homes while taking advantage of market conditions that reward value-added projects. In our business, we’ve taken this concept a step further by focusing on the high-end luxury market, where purchase prices range from $1.4M to $1.8M and ARVs fall between $2.5M and $3M. While flipping in this segment requires a different approach, it’s been a transformative move for us.

Here’s why residential development and renovation, particularly in the high-end market, are such smart plays for 2025:

1. Strong Demand for Quality: Buyers in 2025 want more than just a house—they’re looking for move-in-ready homes with thoughtful designs and premium finishes. This trend spans all price points, but it’s especially true in the luxury market, where buyers expect spaces that combine aesthetics with functionality.
2. Value-Add Potential: Flipping remains a top tactic because of the potential for high returns when value is added strategically. In the luxury market, upgrades like high-end kitchens, spa-like bathrooms, and stunning outdoor spaces drive significant ROI. These details can make or break a flip in a competitive market.
3. Market Timing: As the 2025 market stabilizes, flipping becomes an even stronger tactic. With buyers returning to the market after a period of uncertainty, renovated properties that meet modern expectations will stand out. This is true at every price point, but in the luxury market, where fewer competitors operate, the opportunities are even more pronounced.
4. The Power of an Incredible Team: None of this would be possible without a strong team. We’ve brought contracting, design, and real estate in-house, which has not only streamlined operations but also elevated the quality of every project. Our design team crafts layouts and finishes tailored to luxury buyers, our contractors ensure flawless execution, and our real estate agents manage acquisitions and sales with unmatched expertise. This integrated approach allows us to deliver exceptional results and stand out in a crowded industry.
5. Diversification and Strength: Flipping is a great strategy, but pairing it with diversified services has strengthened our business. By adding an in-house real estate team, we’ve streamlined acquisitions and dispositions, while also creating opportunities to work with clients looking for fixer-uppers. These clients rely on our design and contracting teams to bring their vision to life. This full-service model generates multiple income streams, making our business more adaptable to market shifts.
6. A Word of Caution for New Investors: While flipping is an excellent tactic for 2025, we wouldn’t recommend jumping into the luxury market without experience. The higher price points, tighter profit margins, and greater buyer expectations can be challenging. Start with smaller flips to build expertise, then scale up when you’re ready. The luxury market rewards those who bring experience and precision to the table.

Flipping is undoubtedly a smart tactic for 2025, but it’s about more than just quick profits—it’s about delivering value, meeting buyer expectations, and building a sustainable business model. For us, focusing on the high-end market and integrating our operations in-house has been key to thriving in this space.

Hi @Nicholas L.

We are sourcing our deals through a combination of resources. We have one or two quality wholesalers that we are open to working with. Over the years, we have built quite a network of agents that bring us quality off market properties in the areas that we desire. It's a great partnership. They understand that they can bring us quality homes in great areas in exchange for us doing a quick closing with no hassles.

Flipping homes in San Diego has been an incredible journey, and over the years, we’ve learned a lot about what works—and what doesn’t—in this market. Beyond the lessons from the projects themselves, building a business that’s efficient, diversified, and focused on the luxury market has been a game-changer. Here are some key takeaways from our experience flipping homes and running a renovation business in San Diego.

1. Neighborhoods Set the Tone
San Diego’s neighborhoods each have their own vibe, and we’ve learned that tailoring renovations to match is essential. North Park buyers might love a historic Craftsman with modern touches, while La Jolla buyers want high-end finishes and panoramic views. Understanding the audience for each area helps us maximize the appeal—and the value—of every home we flip.

2. Efficiency Comes from Building the Right Team
One of the biggest ways we’ve streamlined our business is by bringing everything in-house. We have our own design team, contractors, and real estate agency under one roof, which saves time, cuts costs, and improves communication across projects. For example, our design team creates detailed plans that align with market trends, and our contractors execute them with precision. This setup ensures every project stays on schedule and within budget, which is huge in a market where timing is everything.

3. Diversification is Key
Flipping homes is just one piece of our business. By adding our own real estate agency, we’ve opened up new income streams while making our business more versatile. Our agents handle acquisitions and dispositions for our flips, but they also help clients find their dream homes—and that’s where our design and contractor teams come in. For clients who purchase fixer-uppers, we can renovate the property to their exact specifications. This ability to offer a full-service experience not only sets us apart but also keeps revenue flowing, even when the market shifts.

4. Operating in the Luxury Space
We focus on properties in the $1.4 million to $1.9 million purchase price range, which allows us to sell finished projects in the $2.5 million to $3 million range. While it was a scary jump at first, we quickly realized this space is actually less competitive. There aren’t many residential development companies operating at this level, which reduces competition and risk. With the right planning and execution, the rewards in the luxury market far outweigh the initial hesitation.

5. Relationships Matter More Than Ever
Having everything in-house has also helped us build strong relationships with agents, contractors, and clients. Our agents want to work with us because they see the value of being part of a high-producing renovation company. They’re immersed in the process and get to learn about flipping, renovations, and design trends firsthand. This synergy makes our team stronger and keeps us all moving toward the same goals.

6. Buyers Want More Than a Pretty House
San Diego buyers are discerning, and they don’t just want a house that looks nice—they want one that functions well and reflects their lifestyle. That’s where our design team truly shines. We don’t just slap on trendy finishes; we reimagine spaces, improve flow, and create homes that feel unique. Buyers recognize and appreciate that level of thoughtfulness, and it makes our properties stand out in the market.

7. Always Stay Adaptable
The San Diego market is competitive, and timing is everything. Having an in-house team has allowed us to move quickly on acquisitions, execute renovations efficiently, and get properties on the market at the perfect time. This flexibility has been crucial for staying competitive and profitable.

Flipping homes in San Diego has been a rewarding experience, and what’s made it even more fulfilling is building a business that’s about more than just flipping. By combining our in-house teams with a focus on diversification and luxury properties, we’ve created a model that works in any market. Whether we’re flipping a house, helping a client find their perfect home, or designing a custom renovation, everything we do adds value—and that’s the ultimate goal.

Hey @Victor Lo. Welcome to BP. This is a great resource for you. I started my investing career here in San Diego and moved my business to three markets in the Midwest 10 years ago. I flipped, built new construction and built a decent portfolio there. I am San Diego native, and still resident, and have returned to the San Diego market. I have to say. I’m loving it now that I’m operating back in my hometown. 
I’m happy to share some experiences and answer any questions you might have about operating in both markets. I’m happy to hop on a phone call or grab coffee locally. Feel free to reach out anytime.

Hi @Gabrielle Gardiner

Congrats on getting started. This is a great question. The easy quick answer is I would use private money lenders all day long. It is almost the only source that I use for all of my projects. Hard money lenders can be expensive and depending on who you use, there can be a lot of red tape when it comes to your renovation draws, etc. That being said, one of the advantages of a Hard Money Lender as a new Investor is you have an underwriting process that will help you vet a property. A Hard Money Lender will not loan on a project that does not make sense or is too risky for them. One of my favorite techniques when I was first getting started was using a Hard Money Lender for the purchase and using private money for the renovation. This insured my project would move along in a timely manner. My contractor is the engine that keeps my project moving down the track. My renovation funds are the fuel that keeps that engine going.

One recommendation I would have is to break down the holding costs of your project into a daily number. Once you truly understand how much that project is costing you every day, it will help you stay motivated to keep the project moving forward. I currently have a project that costs me $472 a day in holding costs. If I have a contractor that is dragging his feet or doesn't show up for a couple of days, its nearly $1000 that comes straight from profit.

I hope this helps. If you have any questions about building your team or a system, please feel free to reach out.

Mitch

Hey @Bill Everton. Im happy to shed some light and give some thoughts on investing out of state. I live in San Diego as well. I spent the last 12 years building new construction, flipping and building my own portfolio in Indianapolis, and Louisville.. I am now only doing deals in San Diego. 

Happy to set up a call or meet for coffee. Feel free to reach out.

Mitch

Hey @Joshua Zdunich. Fellow San Diego resident and Indy investor. I do mostly new construction and flips currently, but have been in the Indy market for about 10 years and started with buy and holds. Feel free reach out. I would be happy to help where I can. 

Mitch