70% rule calculator

Maximum allowable offer (MAO) = ARV × 70% − rehab cost. Runs in your browser; nothing is saved.

How it works

Example: ARV of $250,000 × 70% = $175,000, minus $40,000 rehab = a $135,000 maximum offer. The remaining 30% of ARV ($75,000) has to cover buying and selling costs, loan interest and points, holding costs, and your profit.

Where the rule breaks

• High-priced markets: 30% of a $700,000 ARV is far more cushion than a typical flip needs, so investors often go higher.
• Low-priced homes: fixed costs eat a bigger share, so 65% or lower can be safer.
• Expensive financing: high points and long holds use up the 30% faster.

Once a deal passes the screen, run the full flip profit calculator with real loan terms from today's published rates.

Common questions

What is the 70% rule in house flipping?

It's a quick screen: your maximum purchase price should be about 70% of the after-repair value (ARV), minus the rehab cost. The 30% left is meant to cover financing, holding, selling costs, and profit.

Is the 70% rule still realistic?

It's a rule of thumb. In expensive or competitive markets, investors often go above 70% on cheaper rehabs; in slow markets or on heavy rehabs, many stay below it. Always run a full cost breakdown.

Does the 70% rule include closing and holding costs?

Not explicitly. They're assumed to fit inside the remaining 30%, along with profit. That's why a full calculator is the better final check.