Fix-and-Flip Profit Calculator: What to Check Before You Buy
Before you buy a flip, run these 5 calculations. Real examples with US costs, contractor pricing, and the profit margins you need to stay safe.
Fix-and-Flip Profit Calculator: What to Check Before You Buy
To calculate fix-and-flip profit, subtract your total project cost (purchase price + renovation + holding costs + selling costs) from the After-Repair Value (ARV). A good flip should have a profit margin of at least 15 to 20 percent of ARV. In 2026, the average US flip profit is approximately $67,000, but 1 in 4 flips either breaks even or loses money because investors underestimate renovation costs and overestimate ARV.
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The 5 Numbers That Drive Every Flip
1. After Repair Value (ARV)
ARV is the property's value after all renovations are complete. This is the foundation of your entire deal — if you get ARV wrong, everything else breaks.
How to estimate ARV accurately:
- Use sold comparables (comps) from the past 90 days
- Comps should be within 0.5 miles and similar in size (within 200 sq ft), age, and bedroom/bath count
- Use the same condition standard — your rehabbed property should match the comps' quality level
- Do not use active listings as comps — only closed sales
If you cannot find strong comps, hire a licensed appraiser for a pre-renovation estimate.
2. Purchase Price
The 70% Rule gives you your maximum allowable offer (MAO):
MAO = ARV × 70% - Rehab Costs
Example: $320,000 ARV, $45,000 rehab → MAO = $224,000 - $45,000 = $179,000
If the seller wants $210,000, you are either overpaying, underestimating rehab, or accepting less than 15% margin. Renegotiate or walk.
3. Rehab Budget
The rehab budget is where most new flippers lose money. Common failure modes:
- Underestimating scope: Not accounting for permit costs, HVAC replacement, electrical upgrades
- Contractor overruns: Single bids, verbal agreements, upfront payment
- Over-improving: Installing granite countertops in a $180,000 neighborhood
Rehab cost rule of thumb by scope:
Scope Cost Range
------- -----------
Cosmetic only (paint, flooring, fixtures) $15,000-30,000
Mid-range (kitchen/bath update + cosmetic) $30,000-60,000
Full gut (plumbing, electric, structural) $60,000-120,000+
Always carry a 15-20% contingency. Always get at least three bids with detailed scope of work in writing.
4. Holding Costs
Every day the property sits — during rehab and listing period — costs you money. Typical holding costs per month:
Expense Monthly Cost
--------- -------------
Hard money loan interest (10-12% annualized) $1,500-2,500 on $200K loan
Property taxes $150-400
Insurance (vacant property) $100-250
Utilities $100-200
Total per month $1,850-3,350
A 6-month flip with $2,500/month in holding costs = $15,000 in holding expenses. This is real money that directly reduces your profit.
5. Selling Costs
Selling a property in the US typically costs 8-10% of the sale price:
- Agent commissions: 5-6% (buyer and seller agents combined)
- Closing costs: 1-2%
- Staging, photography: $1,000-3,000
- Concessions (in buyer's market): 1-2%
On a $300,000 sale, expect $24,000-30,000 in selling costs.
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Fix-and-Flip Profit Calculator
The formula:
Profit = ARV
- Purchase Price
- Rehab Costs
- Holding Costs
- Selling Costs
Worked Example — Jacksonville, FL Duplex:
Item Amount
------ --------
ARV $295,000
Purchase price $162,000
Rehab costs $38,000
Holding costs (5 months × $2,200) $11,000
Selling costs (9% of $295K) $26,550
Total costs $237,550
Gross Profit $57,450
Profit Margin 19.5%
That 19.5% margin is healthy for a 5-month flip. The deal works.
Now run the same numbers if purchase came in at $180,000 (18-day bidding war):
Item Amount
------ --------
ARV $295,000
Purchase price $180,000
Rehab costs $38,000
Holding costs $11,000
Selling costs $26,550
Total costs $255,550
Gross Profit $39,450
Profit Margin 13.4%
Still above zero — but an $18,000 higher purchase price shrank margins from 19.5% to 13.4%. One rehab overrun of $15,000 would push this deal under 10% margin. This is why acquisition price is everything in fix-and-flip.
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Fix-and-Flip Benchmarks