https://access.redhat.com/documentation/en-us/red_hat_openstack_platform/11/html/upgrading_red_hat_openstack_platform/chap-director-major-upgrade#undercloud_upgrade

One more variable should be set to keep the old 192.0.2 ranges for an in-place installation: "inspection_iprange"

If you don't, here's the output that you get:
[stack@ospd ~]$ openstack undercloud upgrade
Loaded plugins: search-disabled-repos
No packages marked for update
2017-12-18 15:32:13,213 INFO: Logging to /home/stack/.instack/install-undercloud.log
2017-12-18 15:32:13,226 INFO: Checking for a FQDN hostname...
2017-12-18 15:32:13,280 INFO: Static hostname detected as os1-ospd-1.instance.cbr.lab
2017-12-18 15:32:13,294 INFO: Transient hostname detected as os1-ospd-1.instance.cbr.lab
2017-12-18 15:32:13,296 ERROR: Undercloud configuration validation failed: Inspection range start "192.168.24.100" not in defined CIDR "192.0.2.0/24"
2017-12-18 15:32:13,296 ERROR:

#

Undercloud upgrade failed.

Reason: Inspection range start "192.168.24.100" not in defined CIDR "192.0.2.0/24"

See the previous output for details about what went wrong. The full install
log can be found at /home/stack/.instack/install-undercloud.log.

#

Traceback (most recent call last):
File "", line 1, in
File "/usr/lib/python2.7/site-packages/instack_undercloud/undercloud.py", line 1461, in install
_validate_configuration()
File "/usr/lib/python2.7/site-packages/instack_undercloud/undercloud.py", line 702, in _validate_configuration
_validate_network()
File "/usr/lib/python2.7/site-packages/instack_undercloud/undercloud.py", line 649, in _validate_network
validator.validate_config(params, error_handler)
File "/usr/lib/python2.7/site-packages/instack_undercloud/validator.py", line 33, in validate_config
_validate_in_cidr(local_params, error_callback)
File "/usr/lib/python2.7/site-packages/instack_undercloud/validator.py", line 109, in _validate_in_cidr
validate_addr_in_cidr(params, 'inspection_start', 'Inspection range start')
File "/usr/lib/python2.7/site-packages/instack_undercloud/validator.py", line 81, in validate_addr_in_cidr
error_callback(message)
File "/usr/lib/python2.7/site-packages/instack_undercloud/undercloud.py", line 646, in error_handler
raise validator.FailedValidation(message)
instack_undercloud.validator.FailedValidation: Inspection range start "192.168.24.100" not in defined CIDR "192.0.2.0/24"
Command 'instack-upgrade-undercloud' returned non-zero exit status 1
[stack@ospd ~]$

As soon as I set that variable to use the old range, 192.0.2.100,192.0.2.120, all good and no problems.