Survey of 1,500 Investors: Fix and Flip Strategy Nets $38K in Profit Per Deal

A new survey conducted by REsimpli reveals that fix and flip is the most profitable exit strategy for real estate investors, delivering an impressive $38,820 in average profit per deal.

The study, which analyzed data from 1,500 US real estate investors, highlights surprising trends in lead conversion rates, revenue sources, and regional performance.

Key Takeaways from the Survey

Here’s a summary of the most interesting findings and key statistics:

# Fix and Flip is the most profitable exit strategy, delivering an impressive $38,820 in average profit per deal.

# Direct mail campaigns generated the highest revenue, totaling $26,670,483.

# Only 1.5% of leads convert into deals, highlighting the significant effort required to close deals. On average, it takes 66 leads to close one deal.

# 42.83% of leads are dead, emphasizing the importance of strong lead management and consistent follow-up strategies.

# Texas generated the highest overall revenue among all states

# Investors earned $30,018 in average revenue in the state of California over the period followed by, Washington ($29.463), Wisconsin ($29,300), Virginia ($27,268), and North Carolina ($27,268).

Why We Conducted This Study

Real estate investors need to focus on the fact that various changes, minor or major, can have lasting impacts on property prices, which can create periods of higher or lower real estate interest.

This study aims to provide crucial insights into the real estate world to understand consumer behavior and to better understand how investors generate leads and close deals.

Key Findings

Fix and flip strategy provided $38,820 profit on average per deal, the most profitable exit type

There are various exit types utilized by real estate investors, but fix and flip was by far the most profitable exit type overall, with $38,820 in profit. 

Fix and flips entail buying properties and refurbishing them to sell them off at a higher price. They are quick and easy for investors who know their community, so much so that fix and flips are the most profitable by $10,134, with wholesale being the next best option.

The list after fix and flip follows: Wholesale double closing ($28,686), Wholetail ($28, 555), Retail Listing ($24,008), Novation ($21,887), and Wholesale assignment ($17,014).

Direct mail campaigns generated $26,670,483 in revenue

$26,670,483 worth of revenue was generated by direct mail campaigns, which is $10,946,400 more than the second-highest revenue earner, cold-calling. 

This statistic can come as quite a shock because direct mail marketing, despite being a traditional form of marketing, has prevailed over digital options. 

With Direct Mail Campaigns being at the top, the rest of the top 5 follows as: Cold Calling ($15,724,083), Pay Per Lead ($9,880,988), Google Adwords/PPC ($8,424,469), and other Website Traffic (SEO, Direct) ($6,450,768).

With more people switching online for both personal and professional needs, real estate proves to be more consequential through the mail, being a more tangible form of marketing. 

1.5% of leads ended in a completion of the deal

Every real estate deal has multiple stages that need to be crossed, and that number tends to be low in real estate, at 1.5%.

The percentage is significantly low, but real estate investors often have an array of marketing campaigns on the go, generating leads. 

The 1.5% lead-to-deal conversion rate pans out to 66 leads per deal, meaning on average, there will be revenue coming in every 66 leads. 

42.83% of leads end up becoming dead leads

Only 1.5% of leads making it to completion can be understood better knowing that 42.83% of all leads, almost half, end up going nowhere.

Almost half of the leads have not progressed to any further stages, showcasing the importance of generating a higher number of leads and managing leads for real estate investors.

The survey revealed that only 10.23% of the leads make it from leads to offers, and only 14.69% of offers go to deals. 

The state of Texas generated the highest total revenue

Texas being the second-most populated and largest area in the United States generated the most overall revenue, showcasing high real estate activity, with California (the most populated state) coming up second.

However, it is noteworthy to acknowledge that the top 5 states, Texas, California, Florida, Ohio, and North Carolina, with the most revenue generated, were on the eastern and western seaboard from the collection of REsimpli’s survey. 

California generated $30,018 in average revenue, being the highest for investors

Despite Texas reigning supreme with the most revenue generated, California holds the top position with $30,018 in revenue per deal.

Ironically, despite generating the most revenue for real estate investors, Texas does not showcase in the top 5 states that generated the most revenue per deal.  

This highlights the fact that real estate activity might be higher in Texas due to its lower prices, whereas California ($30,018), Washington ($29,463), Wisconsin ($29,300), Virginia ($27,268), and North Carolina (27,268) have more desirable properties at higher prices. 

This stands true mostly for Washington, Wisconsin, and Virginia which are not in the top 5 for most revenue generated but are in the top 5 for average revenue generated. 

Implications for the Real Estate Industry

This study helped hone in on some key factors that real estate investors need to focus on to improve their long-term plans in the field. 

Based on this survey of real estate investors using REsimpli, the eastern and western seaboard locations such as California, North Carolina, and Virginia have high-value properties that tend to provide high-quality leads that positively impact the average revenue of a business.

However, if investors are primarily focused on the number of deals they complete, Texas and Ohio can be good areas to invest in.

In terms of exit types, it has been evident that fix and flips have been very profitable for real estate investors, racking up $38,820 for the average profit over 2024. 

Lead generation has to be the most important aspect that real estate investors must focus on because only 1.5% of leads convert into deals, ultimately resulting in revenue. 

With direct mail being the most profitable marketing campaign, that has to take priority, alongside other methods. 

Looking Ahead

The survey provides an in-depth understanding of real estate on a broader scale, and how certain methods and areas prove to be more fruitful. 

The key to real estate lies in being able to track the KPIs, analyze them, and utilize them to improve the different aspects of real estate businesses further. 

The success of direct mail campaigns in the modern world rife with technology showcases the tremendous power of reaching out to potential clients with tangible marketing materials, as opposed to impersonal digital means.

On top of that, it can lend a keen perspective in understanding the different demographics being targeted through various marketing methods.

On the contrary; emails and SEO practices might reach a younger audience with the desire to participate. 

Methodology

This survey had a total of 1,500 users whose information was exported from the REsimpli system. The information was then catalogued into different categories based on the factors.

The substantial size and spread of investors in this survey helped deduce findings with meticulous care and confidence. 

On top of that, a minimum of 50 deals had to be completed for the inclusion of any:

• States
• Deal Source
• Lead Source
• Average Profit
• Revenue

Survey Design & Collection

This survey focused on objective information collected with meticulous care from the REsimpli system, in 2024. The information was accessible through the software, and various data was collected to provide a holistic understanding of the real estate market for investors. 

Limitations

As with any survey, there are bound to be some limitations involved, such as only the top 5 states, exit types, lead source, and others being utilized for this study. This undermines the utility of other factors that may have been implemented less by the investors in general. 

However, the methodology succeeds in providing a substantial understanding alongside the findings, showcasing the current climate of the real estate market in the US, and the direction it might be heading in the future. 

Conclusion

The findings also highlight the significance of maximizing lead generation to increase the chances of a higher number of deals being closed, ultimately leading to higher revenue for the investors.