Fix and Flip Calculator

Return on investment says nothing about time, and time is most of what separates a good flip from a bad one. Fourteen percent earned in five months and fourteen percent earned in eighteen are not the same trade: the first annualizes to roughly thirty-six percent, the second to about nine, and the second also ties up your crew, your credit and your attention for a year and a half. Most flip calculators show only the raw percentage, which flatters slow projects. This one shows both, and the gap between them is usually the most honest thing on the page.

Utilities during the rehab, because the house is empty and it feels like it should cost nothing — but you are running heat, lights and a dumpster-sized power draw for the trades. After that: the insurance premium, which on a vacant property under renovation is a builder's risk or vacancy policy and costs multiples of a normal homeowner's policy; the second half-year of property tax if the project slips past a due date; HOA dues; and lawn and snow service, which a city will fine you for skipping. Enter them here even when they look trivial. Six months of small numbers is a real bite out of a thin spread.

The price a comparable finished house in the same subdivision actually closed at in the last ninety days, not the price one is listed at. List prices carry the seller's hope; closed prices carry the appraiser's and the lender's agreement. If your finish level will genuinely be above the comps, adjust up by the dollar cost of that finish and no more — buyers rarely pay a premium over the neighborhood ceiling. Then run the sensitivity table below the results, because a five percent miss on resale usually moves the profit far more than five percent.

Often yes, and the reason is in the annualized figure rather than the profit figure. Borrowing cuts the cash you have in the deal, so a smaller profit divided by a much smaller denominator is a higher return on your money — and the cash you did not spend is available for a second project running in parallel. Where it goes wrong is a project that slips. Interest accrues monthly on the whole drawn balance whether or not the work is moving, so switch the financing toggle to cash and compare: if the deal only works levered, the schedule has to hold.

It is the number you take to the listing conversation. Every cost in the project except the sale itself is already sunk by the time you list, so the break-even price answers the only question that matters at that point: how low can I go before this stops being a flip and starts being a donation? It is computed by dividing the total non-sale cost by one minus the commission and seller closing percentages, because those costs scale with the price you accept. Anything above the line is profit; anything below it comes out of your pocket at the table.

Ten to twenty percent on a cosmetic rehab of a house you have walked, and considerably more on anything where you have not opened a wall, a panel or a crawlspace. The overruns that kill flips are rarely the ones in the scope — they are the failed sewer lateral, the knob-and-tube discovered behind the plaster, the roof deck that was soft under new shingles. Build the contingency into the rehab number you enter here rather than promising yourself you will absorb it out of profit, because the profit line is exactly where it will come from otherwise.