House Flip Calculator: Return on a Property Flip
See how a house flip performed by setting the full cost of buying and renovating against the net price the property sold for.
Adjust the inputs and select Calculate for a full breakdown.
Year-by-year value projection
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | Total ROI | Annualized ROI | Net profit |
|---|---|---|---|
| $280k in · $360k out · 1yr | 28.57% | 28.57% | $80,000.00 |
| $150k in · $210k out · 1yr | 40.00% | 40.00% | $60,000.00 |
| $400k in · $440k out · 2yr | 10.00% | 4.88% | $40,000.00 |
| $190k in · $185k out · 1yr | -2.63% | -2.63% | -$5,000.00 |
How This Calculator Works
Enter the all-in cost — purchase price plus renovation, holding, and selling costs — and the net sale price after agent and closing costs. Add the holding period. The calculator reports the profit, the total return, and the annualized return.
The Formula
Return on Investment
V_start = amount invested, V_end = amount returned; annualized ROI = (V_end / V_start)^(1/n) − 1
Worked Example
A flip with $280,000 of all-in cost sold for $360,000 net after one year is an $80,000 profit — a 28.6% total return. Over a single year, the annualized return matches the total return.
Key Insight
Flipping lives or dies on costs that are easy to forget — holding costs, financing, and the agent's cut at sale. Counting them in the all-in figure is what separates a real return from an optimistic one.
The 70% rule — and why most flippers ignore it
The classic flipping rule: maximum purchase price = (ARV × 70%) − rehab cost. This leaves 30% of ARV for rehab profit margin, holding costs, selling costs, and unanticipated expenses. A $300K ARV property with $40K rehab supports maximum purchase at $300K × 70% − $40K = $170K.
In hot markets, competition pushes prices above the 70% rule. ATTOM data 2022-2023: average flip ROI fell to 27% — historically low — because flippers paid 75-80% of ARV instead of 70%. The reduced margin left less room for cost overruns, with many flippers seeing 5-15% losses on individual deals when timelines extended or materials inflation exceeded projection.
Sustainable flipping requires DISCIPLINE on the 70% rule even when it means passing on deals. The successful long-run flippers (Tarek El Moussa, Christina Anstead, Sherri Shepherd's investments) work in markets where they can find 70%-rule deals consistently — often by buying off-market through wholesale networks, foreclosure auctions, or distressed seller relationships. MLS-listed properties rarely meet 70% in competitive markets.
Why rehab costs blow budget — the 25-50% overrun pattern
First-time flippers consistently underestimate rehab costs by 25-50%. Common cost-overrun sources: (1) UNANTICIPATED CONDITIONS — opening walls reveals knob-and-tube wiring, galvanized plumbing, asbestos insulation, foundation issues. Pre-purchase inspection catches major items; minor surprises commonly add 5-15% to budget.
(2) CODE COMPLIANCE — bringing renovations to current code often triggers cascade upgrades (electrical panel upgrade, plumbing replacement, fire-safety modifications). Each can add $5K-$20K. (3) PERMIT DELAYS — permit issuance can add weeks to timeline; inspections add more. Holding costs during delays eat into profit (~$2K-$5K per month for typical flip).
(4) MATERIALS INFLATION — 2021-2023 saw lumber, copper, drywall prices spike 50-100%. Quotes from 2022 became insufficient by 2023 completion. (5) LABOR SHORTAGES — quality trades-people are in chronic short supply in hot markets; getting work done on time requires paying premium rates. Budget 15-20% contingency reserve, not the 5-10% many new flippers plan for.
U.S. house flip economics — illustrative deal ($200K purchase, $300K ARV)
Reference flip deal economics for a $300K ARV property. Profit margin depends heavily on cost control and timing.
| Line item | Amount | % of ARV | Notes |
|---|---|---|---|
| After Repair Value (ARV) | $300,000 | 100% | Estimated sale price |
| Purchase price | $190,000 | 63% | Below 70% rule |
| Purchase closing costs (2.5%) | $4,750 | 1.6% | |
| Rehab cost (estimated) | $40,000 | 13% | Quote from contractor |
| Rehab contingency (20%) | $8,000 | 2.7% | Reserve for overruns |
| Holding costs (6 months) | $9,000 | 3% | Insurance, tax, utility, debt |
| Selling costs (8%) | $24,000 | 8% | Commission + closing + transfer |
| TOTAL COSTS | $275,750 | 92% | |
| NET PROFIT (target) | $24,250 | 8% | |
| ROI on capital invested ($60K) | 40% | — | Over 6 months |
Annualized, a 40% ROI over 6 months equates to ~80% annualized — exceptional. But many flips don't hit pro-forma. ATTOM data 2024: average flip return ~30% on capital invested (not on ARV); but ~25% of flips lose money after all costs. The economics depend critically on disciplined purchase price, accurate rehab quotes, and stable market conditions.
Frequently Asked Questions
What should the all-in cost include?
Purchase price, renovation, financing and holding costs such as interest, taxes, insurance, and utilities, plus the selling costs. Omitting these overstates the return.
What is the net sale price?
The sale price after agent commission and closing costs. It is the cash actually received, which is what the return should be measured against.
Why does the holding period matter?
A flip held longer accrues more holding cost and annualizes a fixed profit over more time, lowering the annualized return. Speed is part of a flip's economics.
What return should a flip target?
There is no universal figure, but flippers seek a margin large enough to absorb cost overruns and a slow sale. Thin projected returns leave no room for error.
What are the biggest risks in flipping?
Renovation overruns, a longer-than-expected sale, and a softening market. Each erodes the profit, which is why a conservative all-in cost estimate matters.
When is this calculator unreliable?
As a forward projection — ARV estimates are frequently optimistic, rehab costs typically overrun by 25-50% for first-time flippers, holding periods extend in slower markets, and selling costs are higher than expected. For honest projection: use conservative ARV (80% of recent comparable sales), add 20% rehab contingency, plan for 25-50% longer holding period than initial estimate, and don't count on outsized appreciation during the holding period.
References & Authoritative Sources
- ATTOM Data Solutions — Annual Flipping Report — U.S. Home Flipping Statistics · consulted June 1, 2026 · Industry-leading source for U.S. home flipping data
- National Association of Realtors (NAR) — Investment Property Buyer Survey · consulted June 1, 2026 · U.S. residential investment statistics
- BiggerPockets — Flipping Methodology — House Flipping Best Practices · consulted June 1, 2026 · Industry community methodology
Related Calculators
Data Sources & Benchmarks
This calculator draws on 3 independent, dated sources.
Methodology & Review
House flip profit equals (sale price − purchase price − all costs). All costs include: purchase costs (purchase price + closing costs ~2-3% + holding costs from purchase to start of rehab); rehab costs (materials + labor + permits + contingency 10-20%); selling costs (real estate commission 5-6% + closing 1-2% + transfer taxes varies); holding costs during rehab (insurance, utilities, property tax, debt service). The calculator returns net profit and ROI. U.S. house flip 2024: typical successful flip returns 10-25% ROI over 4-8 months. Failed flips (cost overruns + market shifts) can produce losses of 10-30%. RELIABILITY: Reliable for completed flips with documented costs. Highly unreliable as a forward projection because (a) ARV (After Repair Value) is estimated and frequently optimistic, (b) rehab costs almost always exceed estimates (20-50% overrun is normal for first-time flippers), (c) holding periods extend beyond plan in slower markets, and (d) selling costs are larger than buyers expect.
Updated