What is the 70% rule?

The 70% rule states: Maximum Purchase Price = (ARV × 0.70) - Rehab Costs. This ensures you have enough margin for profit, holding costs, and selling costs. Some investors use 65% for more conservative deals.

What ROI should I aim for when flipping?

Aim for at least 20% ROI for a good flip opportunity. Excellent flips can achieve 30%+ ROI. Ensure you account for all costs including rehab overruns, holding time extensions, and unexpected repairs.

Free House Flip Calculator

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House Flip Calculator

Property Details

Purchase Price ($) *

Rehab Cost ($)

ARV - After Repair Value ($) *

Holding Costs ($)

Utilities, insurance, taxes during rehab

Selling Costs (%)

Realtor commissions, closing costs (typically 5-7%)

Financing

Cash Purchase (No Loan)

Down Payment (%)

Typical: 20-30%

Interest Rate (%)

Hard money: 10-15%

Loan Term (months)

Typical: 6-12 months

Closing Costs (%)

Typical: 2-5%

Understanding House Flipping

House flipping is a real estate investment strategy where you buy a property, renovate it, and sell it quickly for a profit.

The 70% Rule

Max Purchase = (ARV × 0.70) - Rehab Costs

Key Success Factors

Buy properties at 60-70% of ARV
Accurately estimate rehab costs (add 10-20% buffer)
Complete renovations quickly (3-6 months)
Understand local market conditions

Frequently Asked Questions

What is house flipping?

House flipping is buying a property, renovating it, and selling it quickly for a profit. The goal is to complete the process in 3-6 months.

How do you calculate flip profit?

For cash purchases: Profit = (ARV - Selling Costs) - (Purchase Price + Rehab + Holding Costs)
For financed purchases: Profit = (ARV - Selling Costs) - (Down Payment + Closing Costs + Rehab + Holding Costs + Loan Interest) - Loan Payoff

Should I flip with cash or a loan?

Cash purchases have higher ROI but tie up more capital. Hard money loans allow you to flip multiple properties simultaneously but reduce profit due to interest payments. Use this calculator to compare both scenarios.