Fix and Flip Calculator

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How to Use the Fix and Flip Calculator

This calculator is designed to help you quickly analyze the potential profitability of a house flip. A successful flip depends on accurate numbers. Here’s what each field means:

• Purchase Price ($): The amount you are paying for the property itself.
• Renovation Costs ($): Your complete budget for repairing and updating the property. Be thorough and include a 10-15% contingency for unexpected issues.
• After-Repair Value (ARV) ($): The price you expect to sell the property for after all renovations are complete. This should be based on solid comparable sales (comps) in the neighborhood.
• Holding Costs ($): All the expenses you'll incur during the renovation period. This includes loan payments, property taxes, insurance, and utilities.
• Selling Costs ($): The costs associated with selling the property. This typically includes real estate agent commissions (usually 5-6% of the ARV), closing costs, and any seller concessions.

Understanding the Business of Flipping

Flipping houses is a business, and successful investors rely on proven principles to protect their profits.

The 70% Rule: Your Most Important Guideline

In the world of flipping, the 70% Rule is a common guideline used to determine the maximum price you should offer for a property. The formula is:

Maximum Offer = (ARV * 0.70) - Renovation Costs

The remaining 30% is designed to cover your holding costs, selling costs, and your desired profit margin. While it's a guideline and not a strict rule, straying too far from it can significantly increase your risk. You can read more in our guide to the 70% Rule.

"You Make Your Money When You Buy"

This is a common saying among investors for a reason. Your profit is not guaranteed when you sell; it's locked in by buying the property at a large enough discount to absorb all your costs and still leave room for a healthy return.

What To Do With Your Results

The numbers this calculator provides are your first-pass analysis to see if a deal is worth pursuing further.

Analyze the Profit and ROI

The Estimated Profit is your potential return before taxes. The Return on Investment (ROI) shows you that profit as a percentage of your total cash invested. A higher ROI indicates a more efficient use of your capital.

Stress-Test Your Deal

Don't just use one set of numbers. Run the calculation again with higher renovation costs or a lower ARV. If the deal is still profitable under less-than-ideal conditions, you have a much safer investment.

Next Steps

If the initial numbers look promising, your next step is to refine your estimates. Get detailed bids from contractors for the renovation, and ask a local real estate agent to help you create a solid ARV based on the latest market data.