Find the most you should pay for a flip. Enter the after repair value and your repair estimate, and the calculator applies the 70% rule, or 65-80% if your market calls for it.
Enter the after repair value and your repair estimate.
65% in slow or low-price markets, 75-80% in hot, high-price markets.
MAO = ARV x 70% - repair costs. The 30% covers closing, holding, selling costs and your profit, so do not subtract those again.
Maximum allowable offer (MAO) = ARV x 70% - repair costs
ARV is what the house will sell for once it is renovated, based on recent sales of comparable renovated homes nearby. If you do not have it yet, work it out in the ARV calculator. Repair costs are your full rehab budget including contingency; the rehab cost calculator builds that line by line.
A three-bedroom house will sell for about $300,000 once it gets a new kitchen, flooring, and paint. The rehab is budgeted at $45,000 with contingency.
The $90,000 left over (30% of ARV) has to cover closing costs on both ends, commissions, loan costs and months of holding, with profit last. Those are the numbers already loaded in the calculator above.
The 70% figure is a rule of thumb from markets where median flips sold around $150,000-$300,000. Fixed costs do not shrink with the price, so on a $120,000 house the 30% cushion is only $36,000 and 65% is safer. On a $700,000 house, 30% is $210,000, and investors competing for the deal often go to 75-80% while still clearing a solid dollar profit.
Whatever percentage you use, the rule is a filter, not underwriting. Before you make a firm offer, run the deal through the fix and flip calculator with your actual financing, holding time, and selling costs.
The formula is only as good as its two inputs. An ARV based on unrenovated comps, or on sales from a better neighborhood, inflates the offer. A repair budget without contingency does the same. Since a $10,000 error in either number moves your offer by $10,000 or more, spend your time verifying the ARV and the scope of work rather than debating 70% versus 72%.
Last updated: October 2026
The 70% rule says a house flipper should pay no more than 70% of the after repair value (ARV) minus the cost of repairs. On a house worth $300,000 after renovation that needs $45,000 of work, the maximum offer is $300,000 x 0.70 - $45,000 = $165,000.
The 30% is not all profit. It has to pay for buying and selling closing costs, agent commissions, loan interest and points, insurance, taxes and utilities while you hold the property, and then your profit. On most flips, transaction and holding costs eat 12-20% of ARV, leaving 10-18% as profit.
In competitive, high-price markets many investors pay 75-80% of ARV because the dollar margin on a $600,000 house is large even at a thinner percentage. In cheap or slow markets, 65% is safer because fixed costs take a bigger share of a low sale price. Use the rule to screen, then run the full numbers in a fix and flip calculator.
Yes. Put your contingency (usually 10-20%) inside the repair number before applying the rule. Underestimating repairs is the most common way a deal that passed the 70% rule loses money.
Wholesalers use it to estimate what a flipper will pay, then subtract their assignment fee to get the offer to the seller. The wholesale calculator does that in one step.
The rest of the deal, covered by the same free tools.
Work out after repair value from your comps, or pull them automatically by address.
Break a renovation into line items and get a repair budget you can defend.
Pull recent comparable sales for any address and see how each one was adjusted.
Net profit, cash needed, and ROI with financing, holding, and selling costs.
Cash left in the deal after the refinance, cash flow, and DSCR.
Your max offer to the seller with the assignment fee built in.
The formula, comp selection, adjustments, and the mistakes that cost investors money.