Flip Calculator

70% Rule Calculator for House Flipping

Enter the after-repair value and rehab estimate to get your maximum offer under the 70% rule. Then check what a fix and flip loan would cover at that price and how much cash you'd need to close.

The 70% rule
$

What the house will sell for once renovated.

$

Full scope of work, including a contingency.

70% is the classic rule. Some investors use 65% for small deals or 75–80% in expensive markets.

Maximum allowable offer

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Enter ARV and rehab

All-in cost at max offer

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Spread left for costs + profit

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Financing, holding, selling costs and your profit

Check financing at your max offer

650 minimum.

What the 70% rule is and why flippers use it

The 70% rule is the fastest way to decide how much to offer on a fix and flip. You take the after-repair value, multiply by 70%, and subtract the rehab budget. The answer is your maximum allowable offer. Paying more than that leaves too little room for the costs you can't avoid and the profit you came for.

Maximum allowable offer = ARV × 70% − rehab cost. The 30% you hold back has to pay for buy-side closing costs, loan points and interest, taxes, insurance and utilities while you own the house, agent commissions and transfer tax when you sell, any surprises in the rehab, and your profit.

How to use this calculator

  1. Enter the ARV. Base it on recent sales of renovated homes nearby with similar size, beds, baths and lot. Use what comparable homes sold for, not what they were listed at.
  2. Enter the rehab estimate. Use a contractor bid or a line-item budget, and add a contingency of 10% or more for older houses.
  3. Pick your percentage. 70% is the classic rule; adjust it for your market and price point.
  4. Check financing. Add your experience, credit score and the property's location to see how much a fix and flip loan covers at your maximum offer, your rate options, and your cash to close.

When to adjust the percentage

The rule was built around mid-priced houses. Selling costs are a percentage of the price, but many other costs are close to fixed, so the right percentage shifts with the deal. On a $150,000 house, a 30% cushion is $45,000, which may not cover costs and a worthwhile profit, so many investors use 60–65%. On a $700,000 house, the same 30% is $210,000, and 75–80% can still leave a healthy margin. In hot markets, experienced flippers often stretch past 70% and make it up on speed and tight rehab management.

Where the rule falls short

The rule depends on two estimates: ARV and rehab. An optimistic ARV or a thin rehab budget breaks the math before you start. It also ignores how long the project takes. A six-month flip and a twelve-month flip at the same price have very different interest and holding costs. Use the 70% rule to screen deals quickly, then put the ones that pass through the house flipping profit calculator, which counts every cost and prices the loan for your hold period.

The 70% rule and your loan

Fix and flip lenders limit the total loan to a share of the after-repair value and of the total project cost. A purchase at or below the 70% maximum usually leaves the loan comfortably inside those limits, so more of the purchase and rehab gets financed and less cash comes from you. Once you have a property under contract, you can request a term sheet to lock in terms.

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Frequently asked questions

What is the 70% rule in house flipping?

The 70% rule says the most you should pay for a flip is 70% of the after-repair value (ARV) minus the cost of repairs. The remaining 30% of the ARV is meant to cover financing, holding and selling costs plus your profit.

How do you calculate the maximum allowable offer?

Multiply the ARV by 0.70 and subtract the rehab estimate. A house that will be worth $400,000 after a $60,000 rehab gives 0.70 × $400,000 − $60,000 = $220,000. That is your maximum allowable offer (MAO), before any wholesale fee or other acquisition costs.

Is the 70% rule still realistic?

In many markets it is hard to find deals at 70%, so investors adjust. In high-priced markets, 75–80% can still work because selling costs and profit are a smaller share of a larger price. On low-priced houses, 65% or less is safer because fixed costs eat a bigger share. Always check the result with a full profit calculation.

Does the 70% rule include closing and financing costs?

No. They come out of the 30% cushion, along with holding costs, selling costs and your profit. That is why the rule is a screening tool, not a final answer. The financing check on this page shows how much cash you would need at your maximum offer.

Will a lender fund a deal bought at 70% of ARV?

Fix and flip lenders cap the total loan (purchase advance plus rehab) at a percentage of the ARV, commonly around 70–75%, and a percentage of total cost. A deal bought using the 70% rule usually fits within those limits, which is one reason the rule is popular. Run the financing check to see the actual loan for your deal.

Estimates are for planning only and are not a commitment to lend.