Fix-and-Flip Calculator: How to Price a Flip Before You Buy

What a Flip Analysis Actually Measures

A fix-and-flip analysis answers one question: after buying, renovating, holding, and selling a property, how much profit is left for the risk and capital involved? The purchase price is only one of five cost buckets, and beginners often overlook the other four.

The five buckets are purchase price, rehab budget, holding costs, buying and selling transaction costs, and financing costs. A flip that looks profitable on price alone can lose money once holding time, agent commissions, and loan interest are added.

Start With After-Repair Value (ARV)

Everything in a flip is anchored to ARV, the price the finished property should sell for. Estimate ARV from recent sales of comparable, renovated homes in the same neighborhood, adjusting for size, condition, and layout. An inflated ARV is the single most common reason flips fail.

Be conservative. Use sold comparables, not active listings, and weight the most recent and most similar sales. If the range of comps is wide, price the deal off the lower end.

Apply the 70% Rule as a First Filter

The 70% rule is a quick screen: pay no more than 70% of ARV minus the rehab budget. On a property with a 300,000 dollar ARV and 50,000 dollars of rehab, the maximum offer is (300,000 x 0.70) - 50,000 = 160,000 dollars.

The 30% buffer is meant to absorb holding costs, transaction costs, financing, and profit. On lower-priced homes where fixed costs eat a larger share, or in slow markets, some investors tighten the rule to 65%.

Budget Every Cost, Not Just the Rehab

• Purchase costs: closing costs, inspection, and any assignment or finder fees.
• Rehab: materials, labor, permits, and a 10 to 20 percent contingency for surprises.
• Holding costs: property taxes, insurance, utilities, and HOA fees for the full expected timeline.
• Financing: hard-money points and monthly interest, which climb the longer the project runs.
• Selling costs: agent commissions, seller-paid closing costs, and staging.

Calculate Profit and Stress-Test the Timeline

Once every bucket is filled, subtract them all from ARV to find net profit, then divide by cash invested to see return on the capital at risk. Many flippers target a minimum profit floor in absolute dollars, not just a percentage, because a thin margin cannot absorb mistakes.

Time is a hidden cost. Every extra month adds interest, taxes, insurance, and utilities while exposing you to market shifts. Run the numbers at your realistic timeline and again at a timeline that is two months longer to see whether the deal still works.

Frequently Asked Questions