House Flip Roi Calculator
The spread between purchase price and resale price is not your profit. A real flip budget stacks purchase, rehab, closing costs on both ends, holding costs for every month you own it, and financing before a single dollar counts as return. This house flip ROI calculator runs the full stack, then shows net profit, ROI on total project cost, cash-on-cash return when you finance, and the 70% rule check investors use to screen deals.
Quick Answer
A $220,000 purchase with a $45,000 rehab, sold for $340,000 after 6 months, costs $295,200 all-in and nets $44,800: a 15.2% ROI on total project cost, or 32.7% annualized. But the 70% rule caps the offer at $193,000, so this deal fails the classic screen. Finance 75% of the purchase with hard money and the same flip nets about $32,838 with a 27.0% cash-on-cash return.
- Gross profit is a headline, not a return. ATTOM’s “typical” $60,526 Q2 2026 profit is resale minus purchase only; rehab, financing, and selling costs come out after.
- ROI has two honest denominators. ROI on total project cost measures the deal; cash-on-cash measures your money. Leverage lifts the second while shrinking the first.
- The 70% rule is a screen, not a valuation. It caps your offer at 70% of ARV minus repairs, leaving a 30% buffer for costs and profit.
- Time is a cost. Every extra month adds interest, taxes, insurance, and utilities while the profit sits still, which is why the calculator annualizes.
The costs that turn gross profit into net profit
ATTOM’s Q2 2026 flipping report put the typical gross profit at $60,526 with a 21.5% gross margin, but those figures deliberately exclude renovation, financing, taxes, insurance, and selling costs. Experienced flippers estimate the real costs run 20 to 33% of the after-repair value. On the $340,000 worked example, the quiet middle costs total $30,200: $4,400 buying closing, $5,400 holding, and $20,400 to sell. The $120,000 spread shrinks to $44,800 before financing.
Financing is the most-omitted line. Flips usually ride on interest-only hard money, so each month adds interest without touching principal, and 2 to 4 points come out of your cash at closing. Our basic loan calculator can sanity-check the interest carry, and the amortization schedule calculator shows how interest-only payments stack up month by month.
What the 70% rule actually protects
The 70% rule says: never pay more than 70% of the after-repair value minus repair costs. The 30% haircut is not profit; it is the budget for holding costs, selling costs, financing, and then profit. Maximum allowable offer = (ARV x 0.70) – rehab. On the worked example: ($340,000 x 0.70) – $45,000 = $193,000. The $220,000 purchase fails, which is exactly why the computed ROI is a thin 15.2%. The rule did its job: it flagged a deal with no margin for error before any money moved.
The rule is conservative by design and breaks down at the extremes: on luxury flips the 30% buffer overshoots actual costs, and in hot markets few sellers accept 70% offers. A stricter version some investors use subtracts expected holding and selling costs from the maximum offer as well, which puts the ceiling lower still. Treat it as a first filter. Deals that pass still need the full budget; deals that fail need a genuinely special reason, like a rehab far below the estimate or an ARV supported by rock-solid comps.
How leverage changes the ROI story
The same flip looks like two different investments depending on whose money is at risk. All-cash, the $44,800 profit is a 15.2% return on the $295,200 project cost and a 16.3% return on your $274,800 of cash. Finance 75% of the purchase at 10.5% with 2 points and the profit drops to $32,838 after $8,663 of interest and $3,300 in points, but your cash invested falls to $121,763, so the cash-on-cash return jumps to 27.0%.
- Profit: $44,800
- Cash invested: $274,800
- Cash-on-cash: 16.3%
- Risk: no payments, no lender deadlines
- Profit: $32,838
- Cash invested: $121,763
- Cash-on-cash: 27.0%
- Risk: $1,444/mo interest clock; delays eat your thin cash slice
Leverage magnifies both directions: a two-month delay costs the financed flip about $2,900 in extra interest plus $1,800 in holding, wiping nearly 15% of the profit. Check what the monthly carry really costs with our mortgage payment calculator before you sign a hard money term sheet. If you decide to keep the property and rent it instead of selling, the buying rental property calculator tests whether the rent covers those same carrying costs.
What flip calculators get wrong
Most flip calculators ask for purchase, rehab, and resale, then print the spread minus a selling commission and call it ROI. The failures are consistent: financing interest and points are missing entirely, holding costs are a single vague field, the ROI denominator is undefined (total cost? cash invested? nobody says), and there is no screen like the 70% rule to warn you before you fall in love with a spread. This calculator breaks out every cost line, reports ROI on total cost alongside cash-on-cash and an annualized figure, and runs the 70% check automatically. One reading warning applies to every flip tool, this one included: an annualized figure compares projects, it does not promise a yearly income, since back-to-back identical flips with no gaps are rare. One honest limitation: flip profits held under a year are generally taxed as short-term capital gains, effectively ordinary income, per IRS Topic 409, and IRS Publication 551 governs what counts in your cost basis, so talk to a tax professional before counting the profit as spendable.
Frequently Asked Questions
Net profit divided by total project cost, times 100. Net profit is the resale price minus purchase, rehab, buying and selling closing costs, holding costs, and all financing costs. On the worked example: $44,800 / $295,200 = 15.2%.
Pay no more than 70% of the after-repair value minus repair costs. The 30% gap covers holding costs, selling costs, financing, and your profit margin. It is a screening shortcut, not a substitute for a full budget.
Context matters: ATTOM reported a typical gross ROI of 21.5% in Q2 2026, but that is before rehab and financing. Most experienced investors want 20 to 25% net ROI on total cost to justify the execution risk, since one bad surprise can erase a thin margin.
ROI on total cost divides profit by everything the project cost, measuring the deal. Cash-on-cash divides profit by only the cash you personally invested, measuring your money’s efficiency. Financing raises cash-on-cash while lowering net profit.
Generally as short-term capital gains, taxed at ordinary income rates, since flips are held under a year. Frequent flippers can also be classified as dealers, which brings self-employment tax. Keep every receipt: improvements add to your cost basis.
ATTOM measured a median of 161 days from purchase to resale in Q2 2026. Budget conservatively: permits, contractor delays, and slow buyer demand routinely stretch a planned 4-month flip to 6 or 8 months, and every extra month adds carrying costs.
Loan points and interest carry, utilities during renovation, the rehab contingency (10 to 20%), staging and photography, seller concessions, and the months of property tax and insurance while the house sits. Together they routinely total 20 to 33% of ARV.
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References
- ATTOM. Home Flipping Profits Continue Gradual Two-Year Decline (Q2 2026 U.S. Home Flipping Report). Accessed October 18, 2026.
- Internal Revenue Service. Topic No. 409, Capital Gains and Losses. Accessed October 18, 2026.
- Internal Revenue Service. Publication 551, Basis of Assets. Accessed October 18, 2026.
- Freddie Mac. Primary Mortgage Market Survey (PMMS). Accessed October 18, 2026.
- National Association of Realtors. Existing-Home Sales Housing Statistics. Accessed October 18, 2026.
- U.S. Census Bureau. American Community Survey (ACS). Accessed October 18, 2026.
- Board of Governors of the Federal Reserve System. Consumer Credit (G.19). Accessed October 18, 2026.
- Consumer Financial Protection Bureau. What is a debt-to-income ratio? Accessed October 18, 2026.
- Consumer Financial Protection Bureau. Buying a House: Mortgage Tools and Resources. Accessed October 18, 2026.
- Fannie Mae. Single-Family Servicing Guide. Accessed October 18, 2026.