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House Flipping Calculator

Estimate profit, ROI, and maximum offer price on a house flip. Enter your ARV, purchase price, rehab, and holding costs to run the numbers on your deal.

By The Calcumatix Team Reviewed by Calcumatix Editorial Review

Result

$29,000.00

Estimated flip profit is $29,000.00, a 9.67% return on the simplified invested-cost base.

Educational estimate only. Actual project returns depend on financing, taxes, repairs, market time, permits, and sale price risk.

Quick Answer

A house flipping calculator estimates profit using the formula: Profit = ARV − Purchase Price − Rehab Costs − Holding Costs − Closing Costs. Investors also use the 70% rule to find the maximum allowable offer (MAO): MAO = (ARV × 70%) − Rehab Costs (BiggerPockets Real Estate Investing Standard). On a home with a $300,000 ARV and $50,000 in rehab, the MAO is ($300,000 × 0.70) − $50,000 = $160,000.

What A House Flipping Calculator Does And How It Works

A house flip is a real estate investment strategy where an investor purchases a distressed or undervalued property, renovates it, and sells it for a profit within a short timeframe. Calculating profit accurately before purchase is essential because the margin for error in flipping is thin: renovation overruns, carrying costs, and market shifts can quickly eliminate a projected gain. This calculator uses two complementary approaches: the full profit model (ARV minus all project costs) to estimate the actual dollar gain, and the 70% rule (a widely used investor heuristic) to quickly calculate the maximum price you should pay for a property while protecting your target profit margin.

The House Flipping Profit Formula and MAO Calculation

Profit = ARV − Purchase Price − Rehab Costs − Holding Costs − Closing Costs ROI = Profit ÷ Total Cash Invested × 100 Maximum Allowable Offer (MAO) = (ARV × 70%) − Rehab Costs

  • Profit = ARV − Purchase Price − Rehab Costs − Holding Costs − Closing Costs
  • ROI (%) = Profit ÷ Total Cash Invested × 100
  • Maximum Allowable Offer (MAO) = (ARV × 70%) − Rehab Costs

How To Use This House Flipping Calculator In Six Steps

Inputs

  • ARV: your best estimate of the post-renovation sale price
  • Purchase Price: the price you are paying or offering
  • Rehab Costs: total renovation budget
  • Closing Costs: total transaction costs at purchase, entered as a single dollar amount
  • Holding Costs: total combined carrying expenses for the whole hold period (interest, taxes, insurance, utilities), entered as a single dollar amount
  • Selling Costs Percent: agent commissions and seller-side closing costs as a percentage of ARV

Steps

  1. Enter the ARV based on comparable sales from the last 90 days within 1 mile of the subject property.
  2. Enter the purchase price (or the price you are considering offering).
  3. Enter the total rehab cost estimate. If you do not have a contractor bid, add a 20% contingency reserve.
  4. Enter your total closing costs and total holding costs as single dollar amounts for the full project.
  5. Enter your selling costs percentage.
  6. Read the estimated profit, ROI, and whether the purchase price falls within the 70% rule MAO threshold.

House Flipping Calculator Example With Every Step Shown

Analyzing a property with $275,000 ARV, under contract at $140,000, $45,000 rehab, $2,800 closing costs, $9,000 total holding costs, 7% selling costs.

  1. Selling Costs: $275,000 × 7% = $19,250.
  2. Total Project Cost: $140,000 + $45,000 + $2,800 + $9,000 + $19,250 = $216,050.
  3. Profit: $275,000 − $216,050 = $58,950.
  4. Total Cash Invested: $140,000 + $45,000 + $2,800 + $9,000 = $196,800.
  5. ROI: $58,950 ÷ $196,800 × 100 = 29.95%.
  6. MAO (70% Rule): ($275,000 × 0.70) − $45,000 = $147,500.

The $140,000 purchase price is below the MAO of $147,500, passing the 70% rule. Estimated profit is $58,950 with a 29.95% ROI.

When A House Flipping Calculator Gives The Right Answer

Use this tool at the beginning of deal analysis to quickly determine if a property is worth pursuing further. Run it immediately after pulling comps to see if the spread between ARV and asking price leaves enough room to cover rehab, carry, and closing costs.

Assumptions

  • ARV is based on genuine comparable sold properties, not active listings or automated valuation estimates.
  • The 70% rule targets a rough 30% margin to cover rehab, all transaction costs, holding costs, and a profit buffer.
  • Rehab costs are all-in totals including labor, materials, permits, and a contingency reserve.
  • The hold period begins at closing and ends at the resale closing date.
  • No income tax on the flip profit is modelled.

Limitations

  • Does not model financing structure (hard money vs conventional vs cash) or the effect of debt on equity returns.
  • Does not model unexpected rehab scope changes.
  • Does not account for short-term capital gains tax.
  • The 70% rule is a heuristic, not a guarantee.
  • Market timing and ARV accuracy are not modelled.

In Practice

The single biggest mistake new house flippers make is treating an online automated valuation (AVM) or Zillow Zestimate as an ARV. These tools are backward-looking averages and frequently miss the nuance of specific streets, lot sizes, school zones, and finishes. Always build your ARV from closed comparable sales pulled directly from the MLS, ideally reviewed by a local real estate agent. An ARV that is 10% too optimistic on a $300,000 project means $30,000 less profit, which may be your entire margin.

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Frequently Asked Questions About The House Flip Calculator

What does ARV mean in a house flip?

ARV stands for After Repair Value: the estimated market value of the property after all renovations are complete and it is in sellable condition. It is the most important number in a flip deal because every other cost is measured against it. ARV is estimated by analyzing comparable sold properties (comps) in the same neighborhood from the last 90 to 180 days.

What is the 70% rule in house flipping?

The 70% rule is a quick-filter heuristic used by fix-and-flip investors. It states that an investor should not pay more than 70% of the property ARV minus the estimated rehab costs. The formula is: Maximum Allowable Offer = (ARV × 0.70) − Rehab Costs. The 30% buffer left over covers all transaction costs, holding costs, and a profit margin.

How do I estimate holding costs for a flip?

Holding costs are all the expenses you pay while you own the property before selling. The main components are: hard money or private loan interest (often 10–14% annualized), property taxes (prorated to your hold period), homeowner insurance, utilities you must maintain, and any HOA fees. Add these up monthly and multiply by the number of months you expect to hold.

How does the 70% rule change in a competitive market?

In markets with very low rehab costs, strong buyer demand, and fast sales cycles, some investors use a 75% rule to remain competitive. In high-cost markets (high labor, expensive materials, slow permit timelines), some investors tighten to 65%. The percentage is a starting point calibrated to local conditions, not a universal constant.

Do I pay ordinary income tax or capital gains tax on a flip?

If you sell the property within 12 months of purchase, the profit is classified as short-term capital gain and taxed at your ordinary income rate (22–37% for most investors, per IRS Tax Topic 409). If you hold longer than 12 months, the profit qualifies as long-term capital gain (0–20%, depending on your bracket). Most flips are completed in under 12 months, so the short-term rate typically applies.

Sources

Reviewed for accuracy against the formula shown above.