This house flipping calculator estimates the profit from buying, renovating and reselling a property. It combines rehab and contingency with acquisition, holding, borrowing and selling costs, then shows a break-even resale price and the maximum purchase price for your target profit.
A profitable-looking spread between purchase and resale is only the starting point. The model keeps loan principal separate from financing cost, shows cash committed before sale, and tests a lower resale price or a longer project. Defaults and all worked examples are hypothetical, not recommended margins or current contractor and lender quotes.
How to use the house flipping calculator
- Enter the purchase price and your estimated after-repair sale value. Validate ARV against comparable completed sales rather than asking prices alone.
- Enter a written rehab scope and a separate contingency percentage. Add purchase closing fees, excluding loan points entered later.
- Count the entire purchase-to-sale period, including permitting, work, listing, buyer financing and closing.
- Enter monthly non-financing holding costs. Include taxes, insurance, utilities, HOA dues and any other recurring costs you expect.
- Enter the loan, note rate and points, or set the loan to zero for an all-cash project.
- Enter agreed sale-based costs, fixed selling costs and your target pre-tax dollar profit. Check the downside scenarios before copying the result link.
Use the existing renovation cost calculator as a starting reference for bathroom, kitchen or custom work. Its regional benchmarks do not replace a whole-property scope or bids for structural repairs, roofing, permits and hidden damage.
House flip profit, ROI and break-even formulas
rehab budget = base rehab × (1 + contingency ÷ 100)holding expense = monthly holding cost × monthsloan interest = loan × annual rate ÷ 100 × months ÷ 12loan points = loan × points ÷ 100selling expense = sale value × selling rate ÷ 100 + fixed feesproject profit = sale value − all project costs
Total project cost includes the full purchase price and rehab budget, not just the down payment. Project ROI is profit divided by those total costs. Profit margin is profit divided by resale value. Cash ROI is profit divided by cash committed before sale. These denominators answer different questions, so all three are labeled separately.
Break-even resale is (cost before sale + fixed selling fees) ÷ (1 − selling rate ÷ 100). Dividing matters because percentage selling costs grow with the sale price. Simply adding today's selling expense to today's purchase budget does not solve the same equation at a different resale price.
Worked example: buying for $180,000 and selling for $300,000
Assume $40,000 base rehab with a 10% buffer, $5,000 purchase fees and a six-month hold at $600 of monthly non-interest carrying expense. The example borrows $144,000 at 11% with two points, and sells with 5% percentage costs plus $3,000 fixed fees.
| Budget item | Amount |
|---|---|
| Purchase price | $180,000.00 |
| Purchase fees | $5,000.00 |
| Rehab and contingency | $44,000.00 |
| Non-financing carrying costs | $3,600.00 |
| Loan interest | $7,920.00 |
| Loan origination points | $2,880.00 |
| Selling expenses | $18,000.00 |
| Total project cost | $261,400.00 |
| Pre-tax profit | $38,600.00 |
Project ROI is 14.77% and profit margin is 12.87%. Cash committed before sale is $99,400.00, producing 38.83% return on that modeled cash commitment. Selling expenses are paid from the resale proceeds in this model; a cost required before closing needs to be included in your liquidity planning even if the final project profit is unchanged.
Financed vs cash purchases: avoid double-counting debt
The loan changes how the purchase is funded. It does not make the borrowed portion of the purchase disappear from the project budget. Interest and points are additional costs; repaying the borrowed principal settles that funding obligation.
In the example, sale proceeds after selling costs and repayment of the constant loan balance are $138,000.00. Subtract the $99,400.00 previously committed by the investor and you arrive at the same $38,600.00 project profit. This cash reconciliation is a useful check against counting principal twice.
An otherwise identical all-cash project produces $49,400.00 profit and requires $232,600.00 before sale. Removing debt eliminates $10,800.00 in modeled interest and points, but requires more cash. A higher financed cash ROI does not by itself establish that leverage is preferable; it also changes liquidity and downside exposure.
Maximum purchase price and the 70% shortcut
The tool solves maximum purchase price by starting with ARV after percentage selling costs, then deducting fixed sale fees, buying fees, rehab, carrying costs, financing and your target profit. At the defaults, a $30,000 target supports a maximum modeled purchase price of $188,600.00.
This is an algebraic ceiling under fixed assumptions, not a suggested offer. It holds the loan amount and dollar purchase costs unchanged. If a different offer changes loan proceeds, transfer fees, rehab scope or the holding period, update those inputs and run the model again.
A 70%-of-ARV-minus-repairs shortcut implicitly reserves the remaining spread for other costs and profit. Here, 70% of $300,000 minus the $44,000 buffered rehab budget is $166,000. That is a screening assumption, not a verified market threshold. An itemized budget shows what actually consumes the spread and whether your profit target survives it.
Resale and holding-period sensitivity
Test a change in resale value and a delay together. Price reductions affect both revenue and sale-based fees; a delay adds carrying expense and loan interest even if the work budget does not change.
| Resale value | 6-month profit | 8-month profit |
|---|---|---|
| $270,000.00 | $10,100.00 | $6,260.00 |
| $285,000.00 | $24,350.00 | $20,510.00 |
| $300,000.00 | $38,600.00 | $34,760.00 |
| $315,000.00 | $52,850.00 | $49,010.00 |
A 5% lower resale and two-month delay leaves $20,510.00 profit, versus $38,600.00 initially. The model's break-even sale price is $259,368.42. Neither calculation predicts the sale price or completion date; they show the room available under explicit assumptions.
What to verify before relying on a flip budget
- Scope and permits. Include disposal, inspections, professional design, utility reconnection and repairs behind visible finishes.
- Loan draw timing. This model assumes the full loan is outstanding immediately. A construction draw schedule requires interest on actual outstanding balances.
- Borrowing charges. Add lender legal, inspection, draw, extension or exit fees that your quote requires. One point is modeled as 1% of the loan amount.
- Sale agreements. Brokerage compensation is negotiable. The percentage field is a user assumption, not a standard or legally required fee.
- Payoff timing. A real dated payoff can include accrued interest and other charges; the modeled constant principal is not that quote.
- Tax treatment. IRS Publication 544 distinguishes assets held mainly for sale to customers from capital assets. This page does not calculate tax or determine that classification.
For the selling side alone, use the seller closing cost calculator. If the backup plan is to rent the property, run the rental cash flow calculator with the actual borrowing terms and post-renovation expenses. Project profit is an estimate; it is not a contractor bid, lender approval or guarantee of resale value.
Frequently asked questions
How do you calculate profit on a house flip?
Subtract purchase price, acquisition fees, rehab, contingency, holding expenses, financing costs and selling expenses from the final sale price. Loan principal is already part of purchase or rehab spending, so do not subtract it twice when calculating project profit.
How much profit does the example flip make?
The illustrative $180,000 purchase and $300,000 resale produces $38,600.00 of pre-tax project profit after $261,400.00 of total costs. The result depends on the entered budget and fully drawn interest-only loan assumption.
What is ARV?
After-repair value is your estimated sale value after the planned work. Use relevant completed sales, condition adjustments and local professional input. This tool takes your estimate as an input; it does not appraise the house.
What is the 70% rule for flipping houses?
It is a screening shortcut often expressed as maximum purchase price = 70% of ARV minus repairs. The 70% factor is not a law or a universal safe margin. This calculator instead itemizes acquisition, carrying, financing and selling costs and subtracts your target dollar profit.
Does the calculator include hard-money loan costs?
It includes a user-entered annual interest rate and origination points on a constant, fully drawn interest-only balance. Add other financing charges to your budget. Staged construction draws, compounding, extension fees and changing balances need a separate loan schedule.
Is cash ROI the same as project ROI?
No. Project ROI divides profit by all modeled project costs. Cash ROI divides profit by cash committed before sale after loan proceeds. Both cover the full modeled project and neither is an annualized return.
What if the sale takes longer?
At the default assumptions, each extra month adds $1,920.00 in holding expense and loan interest. Two additional months reduce profit by $3,840.00, before any extension fees or additional repairs.
Does this calculate tax on flipping income?
No. The result is pre-tax. Tax treatment depends on the facts, including whether property is held mainly for sale to customers in a business. Do not assume the tax treatment of selling a personal home applies to a flip.
Sources & method
- CFPB — Closing Disclosure rules: commissions, transaction costs, credits and payoffs
- NAR — home sellers: negotiated compensation and seller choices
- IRS Publication 544 — property held primarily for sale to customers and tax classification
- CFPB — payoff amount vs outstanding balance
Results are estimates for general information. Found an error? It helps everyone — see our methodology.