Investor Tool
Real Estate Deal Analyzer
Run the numbers on fix-and-flip or buy-and-hold deals — calculate total investment, maximum allowable offer (MAO), projected profit, and ROI instantly.
Includes insurance, property taxes, loan interest, utilities, and seller commissions.
Projected Profit
$98,000
net return on investment
Return on Investment (ROI)
32.5%
Total Capital Required
$302,000
70% Rule Max Offer (MAO)
$240,000
Profit Margin
24.5%
How to Analyze Real Estate Deals Like a Pro
Evaluating real estate investment deals accurately is the difference between a high-yield property flip and a costly financial mistake. Whether you are wholesaling, flipping houses, or acquiring long-term rental units, knowing how to calculate your **Total Investment**, **After-Repair Value (ARV)**, and **Maximum Allowable Offer (MAO)** is essential.
1. The 70% Rule in Real Estate
The 70% Rule dictates that you should pay no more than 70% of the After-Repair Value (ARV) minus expected renovation expenses. This formula protects your profit margin and leaves buffer for unexpected holding costs or contractor overruns.
2. Estimating Rehabilitation Costs
Break repairs into cosmetic upgrades (paint, flooring, fixtures), major systems (HVAC, roof, plumbing, electrical), and structural work. Always add a 10–15% contingency budget for hidden issues discovered during demolition.
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Frequently Asked Questions About Deal Analysis
What is the 70% Rule in real estate investing?
The 70% Rule states that an investor should pay no more than 70% of the property's After-Repair Value (ARV), minus the estimated cost of repairs. For example, if a house has an ARV of $300,000 and needs $40,000 in repairs, the maximum allowable purchase price is ($300,000 * 0.70) - $40,000 = $170,000.
How do I accurately calculate After-Repair Value (ARV)?
ARV is determined by analyzing recent sales of comparable properties (comps) within a 0.5 to 1-mile radius that are in similar condition to your intended finished project. Look at price-per-square-foot for homes sold within the last 3-6 months.
What holding costs should I factor into a fix-and-flip deal?
Holding costs include property taxes, insurance, loan interest or hard money fees, utilities, lawn care, HOA dues, and selling expenses incurred while the property is being renovated and listed.
What profit margin should I target for real estate flips?
Most experienced real estate investors target a net profit margin of at least 15% to 20% of the ARV, or a minimum return on investment (ROI) of 20% to account for unexpected repair overruns or market shifts.
Need an Experienced Investor Agent?
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