Free tool

70% Rule Calculator

Enter a property’s after-repair value and repair budget to get the maximum you should offer on a fix-and-flip. Free, no sign-up.

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What it sells for fully renovated

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Total rehab budget

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70% is standard; 65% in hot markets

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To compare against your max

Your maximum offer
$225,600

($432,000 × 70%) − $76,800 in repairs

The $285,000 asking price is $59,400 over your maximum. You’d need that much off to make the numbers work.

The formula is the easy part. Getting the ARV and repair costs right is the work — and that’s what ARVIQ does from just an address.

See a real analysis

How the 70% rule works

The rule is a fast filter for fix-and-flip deals. It caps what you pay at 70% of the after-repair value, minus what the repairs will cost. The point is not precision — it is rejecting bad deals in seconds so your real attention goes to the few that survive.

Max offer = (ARV × 0.70) − repair costs

The 30% you hold back is not profit — it is the buffer that covers everything between buying and selling: interest and taxes while you hold the property, agent commissions and closing costs on the way out, and the overruns that appear once demolition starts. Investors who skip that buffer are the ones who finish a renovation and discover they broke even.

A worked example

After-repair value (ARV)$432,000
× 70%$302,400
− Repair costs−$76,800
Maximum offer$225,600

If that property is listed at $285,000, the rule says you are $59,400 above your ceiling — either negotiate it down or move on.

Common questions

What is the 70% rule in house flipping?

The 70% rule says an investor should pay no more than 70% of a property’s after-repair value (ARV) minus the cost of repairs. If a home will be worth $400,000 renovated and needs $60,000 of work, the maximum offer is ($400,000 × 0.70) − $60,000 = $220,000.

Why 70% and not a higher number?

The 30% you hold back is not pure profit. It absorbs holding costs while you renovate (loan interest, taxes, insurance, utilities), selling costs at exit (agent commissions and closing costs commonly total 6–9% of the sale price), and the overruns that surface once walls are open. Pay above the number and you are buying someone else’s margin.

When should I use a different percentage?

Use a lower percentage (65% or less) when the rehab is heavy, the market is cooling, holding costs are high, or the ARV is uncertain. Some investors go to 75% on light cosmetic flips in fast-moving markets with reliable comparables — but that leaves very little room for error.

What does the 70% rule miss?

It is a screening heuristic, not a full underwrite. It ignores your financing costs, how long you will hold the property, your own contractor pricing, and whether the same property might perform better as a rental. Use it to reject bad deals quickly, then model the survivors properly.

How do I know the ARV and repair costs?

That is the hard part — and where most estimates go wrong. ARV comes from recent sales of comparable renovated homes nearby, adjusted for size and condition. Repair costs should be itemized by system rather than guessed as a lump sum. ARVIQ produces both from a property address in about 30 seconds.

Don’t have the ARV and repair costs?

ARVIQ works them out from just an address — itemized repairs, after-repair value, and your max offer, in about 30 seconds.

See a full sample report

This calculator is provided for informational and educational purposes only and is not financial, investment, or appraisal advice. The 70% rule is a rough screening heuristic — always verify values independently and consult qualified professionals before making an investment decision.