What is the 70% rule in house flipping?

Don't pay more than 70% of the after-repair value (ARV) minus repair costs. For a $325,000 ARV with $50,000 rehab, that's a max purchase of about $177,500.

What are holding costs?

Ongoing costs while you own the property: loan interest, property taxes, insurance, utilities, and HOA fees. They add up fast, so a faster flip is more profitable.

How are house flipping profits taxed?

Flips held under a year are taxed as ordinary income (plus self-employment tax if you're a dealer), not at the lower long-term capital gains rate.

What costs do flippers forget?

Selling costs (agent commissions, closing costs), financing points, permit fees, and a contingency buffer for rehab overruns are commonly underestimated.

House Flipping ROI Calculator

By the KalkWise Editorial Team Reviewed for accuracy Updated June 2026

What is the house flipping roi calculator?

In short

House flipping ROI subtracts all costs — purchase, rehab, holding, and selling — from the sale price. Buying at $200,000, spending $50,000 on rehab and $15,000 holding, then selling at $325,000 with 8% selling costs ($26,000) yields a $34,000 profit on a $291,000 investment — about an 11.7% ROI.

Calculates the net profit, ROI, and profit margin on a house flip after accounting for purchase, rehab, holding, and selling costs.

How to use this calculator

1Enter the purchase price and your rehab/renovation budget.
2Add holding costs (loan interest, taxes, insurance, utilities).
3Set selling costs as a percent of sale price (typically 6–9%).
4Enter the expected sale price (after-repair value) to see profit and ROI.

The formula

profit=sale−(purchase+rehab+holding+selling)

ROI=profitinvestment×100

profit = sale − (purchase + rehab + holding + selling); ROI = profit / investment × 100

selling: — sale price × selling cost %
investment: — purchase + rehab + holding + selling
profit: — sale price − investment
ROI: — profit / investment × 100

Worked example

The scenario

$200,000 purchase, $50,000 rehab, $15,000 holding, 8% selling costs, $325,000 sale.

gives

The result

Selling costs: $26,000. Total investment: $291,000. Net profit: $34,000. ROI: 11.7%.

Common use cases

Real estate investors evaluating a fix-and-flip deal.
Applying the 70% rule to decide a maximum purchase price.
Comparing flip ROI against rental property returns.

Limitations & assumptions

Does not model financing costs in detail (points, draws, interest by month).
Does not include income tax on flip profits, which are usually taxed as ordinary income.
Assumes the property sells at the estimated ARV — market shifts can reduce it.

Frequently asked questions

Many flippers target a net profit of at least 10–20% of the total investment, or a fixed minimum profit of $25,000–$50,000 per deal to justify the risk and effort.

Disclaimer: KalkWise calculators are provided for general informational and educational purposes only and do not constitute financial, investment, tax, or legal advice. Results are estimates based on the figures you enter and the assumptions described above. Actual outcomes will vary. Consult a qualified professional before making financial decisions.

Flip details