Fix-and-Flip 70% Rule Calculator

The 70% rule is the most-used quick-screen heuristic in fix-and-flip investing. The math is one line: maximum purchase price equals 70% of After-Repair Value minus the rehab budget. If a deal at the asking price exceeds that number, you walk. If it lands at or below, you take a deeper look — comps, rehab scope, contractor estimates, and financing terms.

What the 30% covers

The 30% gap baked into the 70% rule is not free profit — it covers all the costs that erode your gross spread on a flip. Selling costs run roughly 8% of ARV (6% commission + 1-2% for title, repair credits, and seller-paid concessions). Hard-money interest and holding costs typically run 4-6% of ARV across a 4-6 month project at 9-12% rates. That leaves 15-18% as your profit margin and contingency reserve. If your rehab runs over, your ARV slips, or your sale takes three months instead of two, the buffer absorbs it.

When to use 65% vs 70% vs 75%

The multiplier slider lets you adjust the rule for market and operator conditions. 65% is conservative — appropriate for markets where ARV defensibility is weak (limited recent comps, declining appreciation, atypical floor plan), or for first-time flippers who have not yet built a track record of hitting rehab budgets. 70% is the standard discipline floor for experienced operators in well-comped markets. 75% is aggressive — only justified in markets with strong appreciation, with proprietary deal flow that is not subject to bid-up, or with cosmetic-only rehab scopes.

ARV estimation tips for Texas flippers

ARV is the single most important number in flip math, and it is also the easiest to fudge. Discipline checklist: (1) pull 3-5 closed comps within 0.5 miles, sold in the last 6 months, similar style and square footage to your finished product. (2) adjust comps for differences in finished square footage, garage, lot size, and condition. (3) haircut 5-10% for the appraiser's tendency to land at the median of the comp set, not the top. (4) check active and pending listings for price-pressure signals. In DFW infill, Redfin and Realtor.com pulls are reliable. In Houston, the HAR MLS data is strong. In San Antonio, inside-410 has good comp density. In Austin, recent appreciation flattening means trail-12-month comps may overstate ARV — bias to the last 4-month window.

What this calculator is not

The 70% rule is a screen, not underwriting. A pass at 70% is not a guarantee the deal works — it just earns the deal a deeper look. Real underwriting needs an itemized rehab scope priced by your actual contractor, hard money terms in a written term sheet, comp work tight enough to defend in appraisal, and an exit plan (sell, or refi to DSCR via the BRRRR pivot). Use the "More details" section above to stress-test the deal with your specific financing terms.