What is the 70% rule and why does the calc surface it?

The 70% rule is the classic flip-deal floor: max purchase = (ARV x 70%) minus rehab budget. The remaining 30% covers transaction costs (8-11%), holding (3-6%), financing (2-5%), and net profit (10-15%). Above the threshold, every $1 over compresses profit dollar-for-dollar. The rule is conservative on purpose: most flips that fail were bought above 70%. Repeat flippers reject deals above the threshold reflexively. Some stretch to 75% in hot markets where ARV is anchored; below 70% is the actual entry in distressed markets.

Why is the ARV-purchase gross margin a separate metric from net profit?

Because gross margin tells you the deal’s structural shape; net profit tells you whether the execution penciled. A 28% gross margin can absorb a 10% rehab overrun, a 60-day extra hold, and a 3% ARV haircut and still pencil. An 18% gross margin (typical of a stretch flip) is structurally fragile: same surprises consume the entire profit. Industry ‘fat enough’ threshold is 25%; under 20% is reckless; 30%+ is the clean-win zone. The calc warns when margin is under 25% because headline ROI hides fragility.

How does the contractor buffer math actually work?

Rehab adjusted = rehab budget x (1 + buffer %). Default 20% means a $45K rehab is modeled as $54K. The buffer captures three categories: visible-after-demo surprises (rotted subfloor, knob-and-tube wiring, asbestos, lead paint) at ~70% of overruns; permit-driven scope expansion (cosmetic kitchen requires updated electrical to code) at ~20%; contractor inflation between bid and execution (~10%). Underwriting at 10% buffer is risky (only covers the third category); 15-20% covers the first two; 25%+ covers all three plus a real cushion.

How accurate is the ARV haircut from the selling-market risk score?

Linear, conservative: 0.5% per point with 5% max at score 10. Most stable markets see 0-2% ARV variance from underwriting to close (1-3 score). Mixed-signal markets (5-7) often see 3-5% drift, the calibration sweet spot. High-risk markets (8-10) routinely see 8-15% haircuts at close, well above the 4-5% modeled. The calc is deliberately conservative on the high end because outright corrections (2008-style 15-25% drops) collapse flip economics entirely. For high-score markets, stress-test by manually entering ARV at -10% or -20%.

Why does the calc compare against 8% S&P 500 instead of cap rate or REITs?

Because the relevant comparison is ‘what would the same capital do in your default-passive alternative.’ For most retail flippers that’s an index fund or 401(k). The S&P 500 historical 8% real return is the cleanest single benchmark: outperforms most active management, easily accessible, requires zero work. If your alternative is something else (REITs at 6-7%, high-yield bonds 5-6%, private credit 9-12%), mentally adjust the row. The math is unchanged; the row tells you whether the flip is worth the time-and-stress.

What does the loan rate input cover and what’s missing?

Pure interest cost — loan amount × APR × (months ÷ 12). Missing: origination points (typically 1-3%), processing fees ($500-1,500), draw fees on construction-style loans ($150-400 per draw), prepayment penalties (rare on hard money), and any junior debt or gap funding. For a clean rollup, fold all loan-side fees into the transaction-cost % input — bumps it from 9% to 10-11% combined, which more accurately captures the loan cost picture. Cash purchases (loan rate = 0% AND capital ≥ outlay) skip all of this; the calc handles that case correctly by zeroing interest cost.

How should I think about the capital-available input vs. leverage?

Two questions sit on this single input. First, does the deal pencil? Set capital high enough to skip the loan (capital ≥ purchase + rehab adj) and see if net profit clears the passive-alternative threshold. If not, the deal doesn’t work even with cheap money. Second, what’s the leverage premium? Drop capital to 25-30% of cash outlay and see how ROI changes. Higher leverage cuts both ways: increases ROI when the flip works, accelerates loss when it doesn’t. Veterans underwrite at 25-35% cash.

What about taxes — is the net profit pre-tax or after-tax?

Pre-tax. Flips are taxed as ordinary income (short-term capital gains if held under 1 year, which most flips are; some are taxed as inventory under dealer rules at full ordinary income). Federal + state can hit 30-45% combined for high earners. To get after-tax, multiply net profit by (1 minus marginal rate). A $58K pre-tax profit at 35% effective rate becomes $37,700 after-tax. The calc stays pre-tax because tax treatment is highly individual (entity structure, state, dealer-vs-investor, 1031 eligibility on a long hold).

How does this compare to running my own spreadsheet?

The math is the same as a competent investor spreadsheet: purchase + rehab + holding + transaction + interest = total cost; ARV minus total cost = net profit; (net profit divided by capital) x (12 divided by months) = annualized ROI. What this calc adds: the 70% rule check, the ARV-purchase margin metric (separate from net profit, surfaces structural fragility), the conditional swing-factor list ranked by what would change the answer, and the ‘vs passive alternative’ framing. If you’re spreadsheet-fluent, the calc is the framing layer.

When should I just pass on a flip even if the numbers work?

Five clean cases. ARV-purchase margin under 20%: structurally fragile; one surprise consumes profit. 70% rule violated by 5%+: purchase too high; negotiate or walk. Selling-market risk score 8+: market signaling correction; ARV haircut at close can collapse profit. Hold months over 12: long holds carry compounding interest + holding cost; annualized ROI drops faster than profit grows. Annualized ROI under 15%: passive index investment beats this for less work. Veterans walk from 60-80% of underwritten deals for these reasons.

What about BRRRR (buy / rehab / rent / refinance / repeat)?

Out of scope: BRRRR is a different capital-recovery pattern that doesn’t resolve to a flip P&L. In BRRRR, you don’t sell; you refinance after rehab to pull out 70-80% of ARV and convert to LTR. Run this calc’s ARV + rehab math to underwrite the deal, then run the Airbnb-vs-LTR calc on the post-refinance position. Most repeat investors run both decisions in parallel: flip math says ‘does this deal work,’ rental math says ‘is it worth holding vs flipping for the same total return.’

Why is the calc so conservative on contractor buffer and ARV haircut?

Because ATTOM Data’s 2024 flip-margin report shows the median US flip earns ~$66K gross profit on ~$190K cost (~35% gross margin), but the failure tail is heavy: 25-30% of flips lose money, mostly from rehab overruns and ARV misses. The defaults are calibrated to the realistic case, not the marketing-pitch case on flip-influencer YouTube channels. If defaults look pessimistic, run with optimistic inputs in a second pass; the gap is the ‘hope-vs-discipline’ spread that determines sustainable activity vs one-time learning experience.

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Property Flip ROI Calculator — 70% Rule + Annualized Return + Risk-Adjusted ARV

Drop your purchase price, ARV, rehab budget, contractor buffer, holding cost, transaction cost, loan rate, hold months, market risk score, and capital available. Calculator returns net profit, ROI on capital invested, annualized ROI, ARV-purchase gross margin (industry “fat enough” threshold 25%), 70% rule check, comparison against an 8% passive index alternative, and the top-three swing factors that would change the answer — calibrated to BiggerPockets flip case studies, ATTOM Data 2024 flip-margin reports, NAR closing-cost surveys, and hard-money-lender rate sheets.

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Reviewed by CalcBold EditorialLast verified May 4, 2026Methodology

Purchase price

All-in acquisition cost — purchase + earnest money + buy-side closing if not in transaction-cost line. The single most negotiable input on a flip — every $1 you save here flows directly to net profit. Repeat flippers walk from 60-80% of deals because the purchase price is too high.

ARV (after-repair value)

After-repair value — what the property sells for once renovated. Pull from 3 recent comps (last 90 days, within 0.5 mi, similar sq ft + bed/bath) and use the conservative middle, NOT the optimistic top. Over-estimating ARV by 10% is the most common reason flips fail — anchor against active listings + recent solds, not aspirational pricing.

Rehab budget

Total renovation cost before contractor buffer. Get 3 contractor bids on detailed scope; use the middle bid as your number. Cosmetic-only flips $25-50K typical; structural / mechanical updates $50-150K; major renovation (additions, foundation, full systems) $150-400K+. Add the contractor buffer below to get the realistic number.

Contractor buffer

Contingency on rehab budget for surprises (rotted subfloor, mid-rehab electrical updates, unpermitted additions discovered, foundation hairlines). Industry standard 15-20%; 10% is risky; 25%+ is conservative for first-time flippers. Underwriting at 0% is how flips lose money — surprises ARE the rule, not the exception.

Holding cost

Monthly carry while the property is vacant under rehab. Property tax (1/12 of annual) + insurance (vacant-property rider 30-50% above standard) + utilities (electric for crew + water + gas if winter rehab) + HOA + lawn / snow / security if applicable. Typical 0.6-1.2% of purchase price annually for a vacant property.

Expected hold (months)

Total time from purchase to sale close. Cosmetic flips 3-5 mo; standard rehab 5-8 mo; major rehab 8-12 mo; structural / addition 12-18 mo. First-time flippers consistently underestimate by 30-50% — pad your honest estimate by 20% to capture the realistic timeline.

Transaction costs (combined buy + sell)

Combined % of (purchase + sale) for closing costs both sides. Buy-side closing 2-3%; sell-side 6-8% (5-6% agent commission + 1-2% closing). Combined 8-11% is the realistic range. Below 7% only happens with FSBO sale or off-market direct buyer; above 12% only with multiple closing layers (LLC + 1031 exchange + lender requirements).

Loan rate (APR)

Hard-money APR or conventional investment rate. Hard-money 9-13% APR + 1-3 origination points (origination not modeled — fold into transaction-cost % if material). Conventional investment loans 7-9%; cash 0% (no loan). Top-tier hard-money (Lima One, Roc Capital, Anchor Loans) quote 9-11%; second-tier 12%+; first-flipper unproven borrower 13-15%.

Capital available (your cash)

Cash you can deploy. Drives leverage — if capital ≥ purchase + rehab adj, no loan needed. Smaller capital → higher loan amount → higher interest cost but higher ROI on your invested capital (leverage cuts both ways). Most flippers use 25-30% capital + 70-75% hard-money loan as the modal structure.

Selling-market risk (1-10)

1 = stable / appreciating market (most US suburbs 2024-25). 5 = mixed signals. 10 = declining market (price corrections of 5-10% YoY, oversupply, rate-induced demand collapse). Each point haircuts ARV by 0.5%, capping at 5% at score 10. High-risk markets often haircut another 5-15% by close — stress-test ARV at -10% / -20% if score ≥7.

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What This Calculator Does

The Property Flip ROI Calculator answers the underwriting question every first-time and repeat flipper runs against every deal: does this flip pencil at all, and how robust is it to the surprises that always show up? Drop your purchase price, ARV, rehab budget, contractor buffer, holding cost, transaction cost, loan rate, hold months, market risk score, and capital available. The calculator returns net profit, ROI on capital, annualized ROI, ARV-purchase gross margin (industry “fat enough” threshold 25%), 70% rule check, comparison against an 8% passive index alternative, and the top- three swing factors that would change the answer.

Most flip calculators online return only nominal net profit — ARV minus everything else, take whatever’s left. That misses three things that actually drive flipping success: the 70% rule check (most flips that fail were bought above 70%), the ARV-purchase gross margin (separate from net profit, surfaces structural fragility), and the comparison against passive alternatives (a 12% annualized flip is a worse use of your time than a 9% S&P 500 alternative if the flip consumes 6 months of weekends). This calc surfaces all three so the decision happens with the right framing, not just numerical green-light.

The Math — 70% Rule + Risk-Adjusted ARV + Annualized ROI

Three layers compound. Project cost is purchase + rehab (with contractor buffer for the surprises that always show up — rotted subfloor, electrical updates triggered by inspection, mid-rehab scope expansion) + holding (vacant-property carry — tax, insurance, utilities, HOA) + transaction (buy + sell closing combined 8-11% typical) + loan interest (only on the leveraged portion). ARV risk adjustment haircuts the nominal ARV by 0.5% per market-risk-score point — a conservative anchor for the realistic case where markets soften 2-5% between underwriting and close. Output layer is net profit, ROI on capital invested, annualized ROI (the comparable metric vs. passive alternatives), ARV-purchase gross margin (separate from profit — surfaces structural shape), and the 70% rule check.

Two metrics drive the verdict. Annualized ROI tells you the time-and-capital efficiency — a 12-month flip at 30% ROI is a 30% annualized return; the same 30% return over 6 months is 60% annualized. The S&P 500 historical 8% real return is the cleanest single benchmark; flips need to clear this comfortably to be a defensible time-and-capital allocation. Gross margin tells you the structural shape — under 25%, the deal is fragile and one surprise consumes profit; over 30%, the deal absorbs three things going wrong and still pencils. Repeat flippers reject deals under 25% gross margin out of hand because the headline ROI hides fragility.

A Worked Example — “Standard $300K-ARV cosmetic flip”

Suppose $180K purchase, $300K ARV, $45K rehab, 20% contractor buffer, $650/mo holding, 6 months hold, 9% transaction, 11% loan rate, $60K capital, market risk 5/10:

Rehab adjusted: $45K × 1.20 = $54,000
Project cash outlay: $180K + $54K = $234,000
Loan amount: max(0, $234K − $60K) = $174,000
Interest: $174K × 11% × 0.5 yrs = $9,570
Holding: $650 × 6 = $3,900
Transaction: ($180K + $300K) × 9% = $43,200
ARV risk-adj (2.5% haircut): $300K × 0.975 = $292,500
Total cost: $180K + $54K + $3.9K + $43.2K + $9.57K = $290,670
Net profit: $292,500 − $290,670 = $1,830
ROI on capital: $1,830 ÷ $60K = 3.05%
Annualized ROI: 3.05% × (12 ÷ 6) = 6.1%
ARV-purchase gross margin: 25.0% (right at threshold)
70% rule max purchase: ($300K × 0.7) − $45K = $165K (paid $15K above)
Vs 8% S&P passive over 6 mo: $60K × 4% = $2,400 — passive wins

The verdict reads: “$1,830 net profit (6.1% annualized) — weak flip. Passive index investment beats this; only proceed if non-financial reasons (skill-build, neighborhood acquisition).” At 25% gross margin and 6.1% annualized — and $15K above the 70% rule — this deal is exactly the kind first-time flippers chase because the gross numbers look fine ($300K ARV, $45K rehab) but the real ROI evaporates after honest accounting. The clean signal is: passing on this deal and putting $60K in an index fund makes you $570 more over the same 6 months, with zero execution risk and zero weekend hours. The calc’s job is making this comparison visible at underwriting time, not after closing day when the capital is committed and the discovery is permanent.

When This Is Useful

Six high-value moments. Pre-offer underwriting. Run the calc before submitting any offer. Walking from 60-80% of deals you underwrite is the discipline that separates repeat flippers from one-time learners; the calc gives you a fast triage filter. 70% rule conformance check.The rule is the cleanest single floor for ‘is this a deal-shaped object.’ Above it by 5%+ the deal almost never pencils after honest accounting; below it the deal has structural buffer. Stress-test scenario planning. Run with optimistic inputs (low risk, tight rehab, fast sale), then realistic (industry-benchmark inputs), then pessimistic (10% ARV haircut, 30% rehab overrun, +60-day hold). The gap between optimistic and pessimistic is your operating-risk tolerance. Capital-vs-leverage decision. Run twice — once at full cash (capital ≥ outlay) and once at modal 25-30% capital. ROI premium of leverage is the difference; downside risk also scales. Beginner flippers should keep capital high; veterans optimize leverage. Hard-money lender selection. Each 1% rate reduction saves $L × 1% × (m ÷ 12) on interest. For a $174K loan over 6 months, dropping rate from 12% to 10% saves $1,740 — directly to profit. Use the calc’s sensitivity to prioritize lender shopping. BRRRR-vs-flip decision.Run this calc for the flip case; run the airbnb-vs-LTR calc on the same property post-refinance for the hold case. BRRRR wins when LTR cash flow + refinance proceeds beat flip net profit; flip wins when they don’t.

Common Mistakes

Using optimistic ARV from listing brokers or flip-influencer comps. Listing brokers have an incentive to inflate ARV; flip-influencer YouTube channels show selection- biased success cases. Pull 3 conservative comps (last 90 days, within 0.5 mi, similar specs) and use the middle of the range, NOT the optimistic top. Over-estimating ARV by 10% is the #1 reason flips fail.
Underwriting at 0% or 10% contractor buffer. Industry standard is 15-20%; 10% only covers the contractor inflation between bid and execution (~10% of overruns). The visible-after-demo surprises (rotted subfloor, knob-and-tube wiring, asbestos, lead) account for ~70% of overruns — they ARE the rule, not the exception. 0% is how first-time flippers lose money.
Ignoring the 70% rule when buying. The rule is a floor, not a target. Above it the deal has less buffer for surprises; the calc’s 70% check tells you exactly how much above (or below) you are. Repeat flippers reject deals 5%+ above the threshold reflexively.
Underestimating hold months. First-time flippers consistently underestimate by 30-50%. Cosmetic flips run 3-5 months; standard rehab 5-8; major rehab 8-12; structural / additions 12-18. Pad your honest estimate by 20%; long holds erode annualized ROI through compounding interest + holding cost + opportunity cost.
Skipping the ‘vs. passive alternative’ comparison. A 14% annualized flip seems great until you compare to 8% passive — the 6 pp premium is buying you execution risk + 6 months of weekends + tax drag (flips taxed as ordinary income). Many flips that win on nominal ROI lose on time-and-stress-adjusted ROI.
Forgetting taxes on flip profits. Calc output is pre-tax. Flips taxed as ordinary income (short-term gains under 1 yr; some as dealer inventory). Federal + state combined 30-45% for high earners. After-tax annualized ROI is often half the calc’s headline. Run the after-tax math against your specific marginal rate.
Confusing ROI on capital with annualized ROI. A 30% ROI on capital over 6 months is a 60% annualized ROI. A 30% ROI over 18 months is 20% annualized. Annualized is the comparable metric across deals with different hold periods and the right one to compare against passive alternatives.

Related Calculators

Same property, different operating model — pair with the Airbnb vs Long-Term Rental Calculator for BRRRR investors who want to compare flip economics against post-refinance hold economics. Run the flip calc to see flip net profit; run the airbnb-vs-LTR calc on the same property post-refi ARV to see hold net cash flow. Whichever number wins, that’s the structurally right path. Before any flip, run the House Affordability Calculator (Beyond DTI) to size your honest single-home affordability with realistic single-income assumptions — most first-time flippers over-leverage by relying on flip projections instead of personal-cash-flow math; the affordability calc is the sanity check on what you can afford to lose if a flip goes sideways. Pair with the Investment ROI Calculator to compare flip annualized ROI against plain-vanilla index alternatives — if your flip pencils at 18% annualized but the S&P 500 returned 12% over the same horizon, the 6 pp premium is rarely enough to justify the time + execution risk. And the most important framing layer: run the Compound Interest Calculator with your flip capital + 8% return + 30-yr horizon to see the ‘default passive’ final balance. Flipping every 6 months at 25% annualized vs. compounding at 8% over 30 years: compounding wins by 2-3× because flips have execution risk and tax drag that index investing doesn’t.

Frequently Asked Questions

The most common questions we get about this calculator — each answer is kept under 60 words so you can scan.

What is the 70% rule and why does the calc surface it?
The 70% rule is the classic flip-deal floor: max purchase = (ARV x 70%) minus rehab budget. The remaining 30% covers transaction costs (8-11%), holding (3-6%), financing (2-5%), and net profit (10-15%). Above the threshold, every $1 over compresses profit dollar-for-dollar. The rule is conservative on purpose: most flips that fail were bought above 70%. Repeat flippers reject deals above the threshold reflexively. Some stretch to 75% in hot markets where ARV is anchored; below 70% is the actual entry in distressed markets.
Why is the ARV-purchase gross margin a separate metric from net profit?
Because gross margin tells you the deal’s structural shape; net profit tells you whether the execution penciled. A 28% gross margin can absorb a 10% rehab overrun, a 60-day extra hold, and a 3% ARV haircut and still pencil. An 18% gross margin (typical of a stretch flip) is structurally fragile: same surprises consume the entire profit. Industry ‘fat enough’ threshold is 25%; under 20% is reckless; 30%+ is the clean-win zone. The calc warns when margin is under 25% because headline ROI hides fragility.
How does the contractor buffer math actually work?
Rehab adjusted = rehab budget x (1 + buffer %). Default 20% means a $45K rehab is modeled as $54K. The buffer captures three categories: visible-after-demo surprises (rotted subfloor, knob-and-tube wiring, asbestos, lead paint) at ~70% of overruns; permit-driven scope expansion (cosmetic kitchen requires updated electrical to code) at ~20%; contractor inflation between bid and execution (~10%). Underwriting at 10% buffer is risky (only covers the third category); 15-20% covers the first two; 25%+ covers all three plus a real cushion.
How accurate is the ARV haircut from the selling-market risk score?
Linear, conservative: 0.5% per point with 5% max at score 10. Most stable markets see 0-2% ARV variance from underwriting to close (1-3 score). Mixed-signal markets (5-7) often see 3-5% drift, the calibration sweet spot. High-risk markets (8-10) routinely see 8-15% haircuts at close, well above the 4-5% modeled. The calc is deliberately conservative on the high end because outright corrections (2008-style 15-25% drops) collapse flip economics entirely. For high-score markets, stress-test by manually entering ARV at -10% or -20%.
Why does the calc compare against 8% S&P 500 instead of cap rate or REITs?
Because the relevant comparison is ‘what would the same capital do in your default-passive alternative.’ For most retail flippers that’s an index fund or 401(k). The S&P 500 historical 8% real return is the cleanest single benchmark: outperforms most active management, easily accessible, requires zero work. If your alternative is something else (REITs at 6-7%, high-yield bonds 5-6%, private credit 9-12%), mentally adjust the row. The math is unchanged; the row tells you whether the flip is worth the time-and-stress.
What does the loan rate input cover and what’s missing?
Pure interest cost — loan amount × APR × (months ÷ 12). Missing: origination points (typically 1-3%), processing fees ($500-1,500), draw fees on construction-style loans ($150-400 per draw), prepayment penalties (rare on hard money), and any junior debt or gap funding. For a clean rollup, fold all loan-side fees into the transaction-cost % input — bumps it from 9% to 10-11% combined, which more accurately captures the loan cost picture. Cash purchases (loan rate = 0% AND capital ≥ outlay) skip all of this; the calc handles that case correctly by zeroing interest cost.
How should I think about the capital-available input vs. leverage?
Two questions sit on this single input. First, does the deal pencil? Set capital high enough to skip the loan (capital ≥ purchase + rehab adj) and see if net profit clears the passive-alternative threshold. If not, the deal doesn’t work even with cheap money. Second, what’s the leverage premium? Drop capital to 25-30% of cash outlay and see how ROI changes. Higher leverage cuts both ways: increases ROI when the flip works, accelerates loss when it doesn’t. Veterans underwrite at 25-35% cash.
What about taxes — is the net profit pre-tax or after-tax?
Pre-tax. Flips are taxed as ordinary income (short-term capital gains if held under 1 year, which most flips are; some are taxed as inventory under dealer rules at full ordinary income). Federal + state can hit 30-45% combined for high earners. To get after-tax, multiply net profit by (1 minus marginal rate). A $58K pre-tax profit at 35% effective rate becomes $37,700 after-tax. The calc stays pre-tax because tax treatment is highly individual (entity structure, state, dealer-vs-investor, 1031 eligibility on a long hold).
How does this compare to running my own spreadsheet?
The math is the same as a competent investor spreadsheet: purchase + rehab + holding + transaction + interest = total cost; ARV minus total cost = net profit; (net profit divided by capital) x (12 divided by months) = annualized ROI. What this calc adds: the 70% rule check, the ARV-purchase margin metric (separate from net profit, surfaces structural fragility), the conditional swing-factor list ranked by what would change the answer, and the ‘vs passive alternative’ framing. If you’re spreadsheet-fluent, the calc is the framing layer.
When should I just pass on a flip even if the numbers work?
Five clean cases. ARV-purchase margin under 20%: structurally fragile; one surprise consumes profit. 70% rule violated by 5%+: purchase too high; negotiate or walk. Selling-market risk score 8+: market signaling correction; ARV haircut at close can collapse profit. Hold months over 12: long holds carry compounding interest + holding cost; annualized ROI drops faster than profit grows. Annualized ROI under 15%: passive index investment beats this for less work. Veterans walk from 60-80% of underwritten deals for these reasons.
What about BRRRR (buy / rehab / rent / refinance / repeat)?
Out of scope: BRRRR is a different capital-recovery pattern that doesn’t resolve to a flip P&L. In BRRRR, you don’t sell; you refinance after rehab to pull out 70-80% of ARV and convert to LTR. Run this calc’s ARV + rehab math to underwrite the deal, then run the Airbnb-vs-LTR calc on the post-refinance position. Most repeat investors run both decisions in parallel: flip math says ‘does this deal work,’ rental math says ‘is it worth holding vs flipping for the same total return.’
Why is the calc so conservative on contractor buffer and ARV haircut?
Because ATTOM Data’s 2024 flip-margin report shows the median US flip earns ~$66K gross profit on ~$190K cost (~35% gross margin), but the failure tail is heavy: 25-30% of flips lose money, mostly from rehab overruns and ARV misses. The defaults are calibrated to the realistic case, not the marketing-pitch case on flip-influencer YouTube channels. If defaults look pessimistic, run with optimistic inputs in a second pass; the gap is the ‘hope-vs-discipline’ spread that determines sustainable activity vs one-time learning experience.