About House Flip Calculator
Free house flip calculator. Enter purchase price, renovation costs, ARV, and holding costs to calculate your flip profit, ROI, and 70% rule compliance instantly.
How to use
- Enter the property purchase price and your estimated total renovation budget. Break renovation costs into categories: structural, kitchen, bathrooms, flooring, paint, exterior, landscaping, permits, and a 15-20% contingency for unexpected issues. Underestimating rehab costs is the most common reason flips lose money.
- Input the after-repair value (ARV) based on recent comparable sales in the immediate neighborhood. Use properties that sold in the last 3-6 months with similar square footage, bedrooms, bathrooms, and finishes. Be conservative — overestimating ARV by even 10% can eliminate your entire profit margin.
- Add monthly holding costs including mortgage/hard money loan interest, property taxes, insurance, utilities, and maintenance. At 12% hard money rates on a $200,000 loan, interest alone is $2,000/month. A 6-month flip accumulates $12,000 in interest costs.
- Set your expected project timeline from purchase to sale. Include rehab time (2-6 months), listing period (1-3 months), and closing period (30-60 days). Every extra month adds holding costs that eat into profit.
- Include selling costs: real estate agent commissions (4-6% of sale price in Canada, 5-6% in the US), closing costs (1-2% for sellers), staging, professional photography, and any buyer credits or concessions.
- Review your projected net profit, ROI, and the 70% rule assessment. The calculator shows whether the deal meets the fundamental viability threshold. If your profit margin is thin, identify which costs could be reduced to improve the outcome.
- Run worst-case scenarios: what if rehab takes 2 months longer? What if the property sells for 5% less than ARV? What if holding costs increase? A good flip still works under moderate stress conditions.
Frequently asked questions
What is the 70% rule in house flipping?
The 70% rule states that you should pay no more than 70% of the after-repair value (ARV) minus repair costs. On a property with a $300,000 ARV and $50,000 in needed repairs, your maximum purchase price is ($300,000 x 0.70) - $50,000 = $160,000. This 30% margin covers your holding costs, selling costs, and profit. If you pay more than the 70% rule allows, your profit margin shrinks dangerously. The rule is a quick screening tool — always run the full numbers afterward, but if a deal does not pass the 70% rule, it rarely works out profitably.
What profit margin should I target on a flip?
Target a minimum net profit of 10-15% of the ARV, or at least $30,000-$50,000 per flip. Experienced flippers aim for 20% or more on higher-risk projects. On a $300,000 ARV property, you should net at least $30,000-$45,000 after all costs (purchase, rehab, holding, selling). Anything less than $20,000 net profit is generally not worth the risk, time, and effort involved — one unexpected foundation issue, delayed permit, or market softening can eliminate a thin profit entirely. Factor in your time investment: if a flip takes 6 months and nets $25,000, your effective hourly rate may be lower than a regular job. Use the
Closing Cost Calculator to get an accurate estimate of your selling costs before finalizing your profit projection.
What are typical holding costs for a flip?
Monthly holding costs include: hard money or bridge loan interest (8-14% annually, or $1,000-$2,500/month on a $200,000 loan), property taxes ($200-$600/month), insurance ($100-$200/month), utilities ($150-$300/month), and lawn/snow maintenance ($100-$200/month). Total monthly holding costs typically range from $1,500 to $3,500. Over a 6-month project, that is $9,000-$21,000 that must come out of your profit. This is why speed matters in flipping — every month of delay directly reduces your profit dollar for dollar.
How long does a typical house flip take?
Cosmetic flips (paint, flooring, fixtures, landscaping, minor kitchen/bath updates) take 2-4 months from purchase to listing. Moderate rehabs (full kitchen remodel, bathroom additions, roof replacement) take 4-6 months. Major renovations (structural changes, additions, foundation work, full gut) take 6-12 months. Add 1-3 months for listing and selling, plus 30-60 days for closing. In hot markets, the selling period is shorter. In slow markets, budget extra months. Your timeline directly affects holding costs and overall profitability.
How much money do I need to start flipping houses?
Your total capital requirement includes: down payment on the purchase (10-30% for hard money loans, 20-25% for conventional), rehab costs (funded by your lender, your own cash, or a combination), holding costs for the project duration, and a cash reserve for unexpected expenses. On a typical $200,000 purchase with $50,000 in rehab: a hard money lender requiring 20% down needs $40,000 for the down payment, $50,000 for rehab (some lenders fund 100% of rehab), and $15,000 for holding costs — roughly $80,000-$105,000 total. Some investors start with less by partnering with others or using private money.
What renovations give the best ROI on a flip?
Highest ROI renovations for flipping: kitchen updates (80-120% ROI — new countertops, cabinet refinishing, modern hardware, and appliances), bathroom remodels (70-100% ROI), fresh paint throughout (300-500% ROI — the cheapest high-impact improvement), new flooring (100-150% ROI for replacing carpet with LVP or hardwood), curb appeal improvements like landscaping and a new front door (100-200% ROI). Lowest ROI for flips: swimming pools, luxury additions, finished basements in markets where they are uncommon, and ultra-high-end finishes in mid-range neighborhoods. Match your finishes to the neighborhood standard — over-improving is a common mistake.
Do I pay taxes on house flip profits?
Yes. In Canada, house flip profits are typically taxed as business income (100% taxable at your marginal rate), not capital gains. The CRA specifically targets frequent property transactions, and a property held for less than 12 months is almost always treated as inventory rather than a capital asset. At a 40% marginal rate, a $50,000 flip profit yields only $30,000 after tax. In the US, flips held less than one year are taxed as short-term capital gains (ordinary income rates, 22-37%), while properties held over one year qualify for long-term capital gains rates (0-20%). Factor taxes into your profit projections from the start.
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