House Flipping Calculator: Every Cost That Decides Whether Your Flip Profits
A house flipping calculator must model all four cost categories (purchase, rehab, holding, and selling) before you make an offer. This guide covers every line item with real cost ranges, the 70% rule, a full worked example from Indianapolis, and a sensitivity check showing how fast one overrun erases your margin.
The investors who lose money on flips almost always made the same mistake: they modeled some of the costs, not all of them. The rehab ran over budget. The carrying costs were higher than expected. The selling costs were never modeled at all. By the time the property sold, what looked like a $40,000 profit on paper turned into a $6,000 gain, or a loss.
A house flipping calculator forces you to account for every number before you are committed to the deal. This guide covers all four cost categories that must go into any flip analysis, real cost ranges for every line item, a full worked example from Indianapolis showing purchase to profit, and a sensitivity check that shows exactly how much margin disappears when one variable shifts.
The Four Cost Categories Every Flip Calculator Must Include
A house flipping calculator must account for four cost categories: (1) Purchase costs: property price and acquisition closing fees; (2) Rehab costs: all labor and materials plus a 10 to 15 percent contingency reserve; (3) Holding costs: financing interest, taxes, insurance, and utilities for every month you own the property; (4) Selling costs: agent commission, seller closing costs, and staging. Missing any single category produces a profit projection that is not real.
Most first-time flippers model purchase plus rehab and stop there. Holding and selling costs combined typically consume 8 to 15 percent of ARV. On a $175,000 deal, that is $14,000 to $26,000 left off the model.
| Cost Category | Typical % of ARV | What It Covers |
|---|---|---|
| Purchase | 45–55% | Property price, closing costs, due diligence fees |
| Rehab | 20–30% | All labor and materials plus 10–15% contingency |
| Holding | 6–10% | Financing interest, taxes, insurance, utilities per month |
| Selling | 7–9% | Agent commission, seller closing costs, staging |
Acquisition Costs: What You Pay Before the Rehab Starts
The purchase price is the largest single line item in the deal and the one you control most directly. The 70% rule sets your ceiling, covered in detail in the worked example below.
Hard money or bridge loan origination: Most flips are financed with short-term hard money loans at 10 to 14 percent annual interest and 1 to 3 points origination, paid at closing. Terms are typically 6 to 12 months. Investors who plan to convert a light renovation into a long-term rental may use a DSCR loan instead; it carries a lower rate and longer term, but qualifies differently than hard money.
Purchase closing costs: Title insurance, escrow fees, lender fees, and recording fees typically total 1 to 3 percent of the purchase price. On a $78,000 acquisition, expect $780 to $2,340 at the closing table.
Pre-purchase due diligence: A full property inspection ($300 to $500) and title commitment are non-negotiable before closing. For properties with unknown histories, an environmental report or structural engineer inspection may also be required. Skipping due diligence to move faster is how investors inherit hidden problems.
Earnest money deposit: Typically $1,000 to $5,000, paid when the purchase contract is signed and credited back to you at closing. It is not an extra cost. It is cash tied up during the contract period.
Rehab Costs: The Biggest Variable in the Deal
Rehab is where most flip budgets break down. Unexpected structural conditions, permit delays, and scope creep are the primary causes. The cost ranges below reflect typical 2025 to 2026 contractor pricing for a 1,200 to 1,600 square foot home.
Major systems (if needed):
- Roof replacement: $8,000 to $18,000
- HVAC full system replacement: $5,000 to $12,000
- Plumbing: $3,000 to $10,000
- Electrical panel and rewiring: $3,000 to $8,000
Interior finishes:
- Kitchen remodel: $10,000 to $35,000 (cosmetic refresh versus full gut)
- Bathrooms: $5,000 to $15,000 per bath
- Flooring (1,500 sq ft): $4,000 to $10,000
- Interior and exterior paint: $3,000 to $6,000
- Landscaping and curb appeal: $1,000 to $5,000
Contingency reserve: Add 10 to 15 percent on top of your total scope estimate before finalizing the rehab budget. Renovation projects in older homes almost always surface surprises: rotted subfloor, inadequate electrical, permitting requirements that add cost. The contingency reserve is not optional. It is the margin between a project that works and one that wipes out your profit.
Two rules that protect your budget: get three bids before awarding any scope of work, and structure all contractor payments in milestones tied to completed phases. Never pay more than 30 to 40 percent upfront on any single contract.
Holding Costs: Every Month You Own It, the Clock Ticks
Holding costs are a time-dependent variable. The longer the project runs, the more they cost. This is the category that separates experienced flippers who close in 90 days from investors who see their margin erode over a slow rehab or a soft listing period.
Hard money interest: At a 12 percent annual rate, a $200,000 loan costs approximately $2,000 per month in interest. On a $78,000 acquisition loan at the same rate, that is $780 per month before any other costs.
Property taxes: Typically $200 to $600 per month depending on the market and the property's assessed value. These accrue whether or not you are actively renovating.
Vacant property insurance: Standard homeowner's insurance does not cover a property under renovation. Vacant or builder's risk policies cost $150 to $300 per month. Going without coverage during the rehab is a significant uninsured liability.
Utilities: Heat, electric, and water for an active construction site run approximately $100 to $200 per month. These cannot be turned off during the project.
HOA fees: $0 to $400 per month if the property is in a homeowners association. HOA fees continue regardless of the property's occupancy or renovation status.
A typical mid-range flip in a secondary market totals $2,400 to $3,000 per month in holding costs. Over five months: $12,000 to $15,000. Every additional month, whether from a contractor delay, permit backlog, or slow listing, adds the same amount directly to your cost stack.
Rule of thumb: holding costs run 1 to 1.5 percent of ARV per month.
Selling Costs: The Category Most First-Time Flippers Forget
Selling costs are fixed and significant. They are also the most commonly omitted category in a first-time flipper's analysis, which is why so many flips generate less profit than projected.
Real estate agent commission: The standard seller-side commission is 5 to 6 percent of the sale price. On a $175,000 sale, that is $8,750 to $10,500. Following the 2024 NAR settlement, buyer's agent compensation is now negotiated separately in many markets, but sellers should still budget for the full commission range.
Seller closing costs: Transfer taxes, escrow fees, and recording costs add 1 to 2 percent. On a $175,000 sale: $1,750 to $3,500.
Staging and photography: Staged homes sell faster and for more than empty ones. A furnished staging for a 3-bedroom property runs $1,000 to $4,000. Professional photography is standard and typically runs $300 to $600.
Price reduction risk: If the property sits on market for more than 30 to 45 days, a price reduction of 3 to 5 percent is often necessary to generate a contract. On a $175,000 listing, that is $5,250 to $8,750 coming off your projected net.
After all selling costs, a flipper typically nets 92 to 94 percent of the sale price. Model this from day one, not after the property goes under contract.
The Full Worked Example: Indianapolis 3BR/2BA
Here is how all four cost categories come together on a specific deal.
Property: 3-bedroom, 2-bathroom distressed single-family in Indianapolis. ARV from comps: $175,000. For how to calculate ARV from comparable sales before running any flip calculator, see the ARV in Real Estate guide.
Step 1: Apply the 70% rule to set the maximum purchase price. Max purchase = ($175,000 x 0.70) - $42,000 rehab = $80,500. Investor pays $78,000, which is $2,500 under the ceiling.
Step 2: Stack every cost.
| Cost Item | Amount |
|---|---|
| Purchase price | $78,000 |
| Purchase closing costs | $2,000 |
| Rehab (includes 10% contingency) | $42,000 |
| Holding costs (5 months x $2,400/mo) | $12,000 |
| Selling costs (6% commission + closing) | $10,500 |
| Total all-in | $144,500 |
Step 3: Calculate net proceeds and profit.
| Sale at ARV | $175,000 |
| Less selling costs | ($10,500) |
| Net proceeds | $164,500 |
| Less purchase, rehab, and holding | ($132,000) |
| Gross profit | $32,500 |
ROI: $32,500 profit / $122,000 cash invested = 26.6%
Step 4: Run the sensitivity check.
This is the step most flip analyses skip, and it is where the deal either holds up or falls apart.
- Rehab runs $8,000 over budget: profit drops to $24,500. ROI falls to 20%.
- Project takes 2 additional months (7 months total): holding costs rise by $4,800. Profit: $27,700. ROI: 22.7%.
- Both scenarios happen simultaneously: profit shrinks to $19,700. ROI: 16.1%.
All three scenarios still generate a positive return because the investor bought at $78,000, not at the $95,000 as-is asking price. Paying $17,000 more for the same property (skipping the 70% rule to win the deal) would have turned the combined overrun scenario into a net loss.
Run Your Flip Numbers in ProPilot Before You Make an Offer
Building this cost model manually in a spreadsheet introduces formula errors and makes scenario testing tedious. ProPilot's deal calculator accepts all four cost categories (purchase, rehab, holding, and selling) and outputs gross profit, ROI, and whether the deal clears the 70% rule threshold, before you make an offer.
The auto-comps feature pulls comparable sales data for any zip code so your ARV is grounded in actual recent transactions, not the best-case comparable you found on a listing site. For investors managing more than one deal at a time, ProPilot's deal pipeline tracks each project at its current stage: acquisition, under rehab, listed, sold. No deal gets analyzed once and forgotten.
Run your next flip in ProPilot before you write the offer. Try it free for 7 days.
Frequently Asked Questions
How do you calculate profit on a house flip?
Gross flip profit equals net sale proceeds minus all costs: purchase price, acquisition closing fees, rehab, holding costs, and selling costs. Net proceeds are the sale price minus agent commission and closing costs, typically 92 to 94 percent of the sale price. Always model all four cost categories before making an offer. Most flip losses trace back to ignoring holding costs or selling costs in the initial analysis.
What is a good ROI for a house flip?
Most experienced flippers target 20 to 30 percent ROI on invested capital, or a minimum gross profit of 15 to 20 percent of ARV. Below 15 percent gross margin, a single cost overrun or two extra months on the holding period can eliminate profit entirely. The 70% rule is specifically designed to protect this minimum margin by capping the purchase price relative to ARV and the rehab budget.
How long does the average house flip take?
The average fix-and-flip timeline is 4 to 6 months from purchase to closed sale. Light cosmetic projects (paint, flooring, fixtures) can close in 60 to 90 days. Heavy structural rehabs often run 6 to 9 months. Every additional month adds $2,000 to $4,000 in holding costs at typical hard money rates and carrying expenses, which is why project timeline management is as important as rehab budget control.
What is the 70% rule for house flipping?
The 70% rule limits your maximum purchase price to 70 percent of ARV minus your estimated rehab costs: Max Price = (ARV x 0.70) - Rehab Cost. The 30 percent buffer inside the rule is sized to cover typical holding and selling costs plus a profit margin. Paying above the 70% threshold compresses that buffer. In strong markets with fast days on market, some investors stretch to 75 percent, but that requires tighter execution and leaves less room for the cost overruns that are standard in renovation projects.
Run the Numbers Before You Run the Risk
Four cost categories. One missed category can make the deal look better than it is. A house flipping calculator is only as useful as the inputs that go into it, and only if the sensitivity check is run before the offer is submitted, not after the rehab surfaces a surprise.
The Indianapolis example shows a viable 26.6% ROI. It also shows how quickly that shrinks when the rehab runs over or the listing sits for two months. Build the full model before you fall in love with the property.
For a complete walkthrough of the flip process from finding a deal to the closing table, see the how to flip a house guide.
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