Real Estate
Assess your potential profit from buying, renovating, and flipping real estate properties.
Enter property details, renovation costs, holding expenses, and sales data to see your projected net profit.
Real estate house flipping involves buying undervalued or distressed properties, renovating them, and selling for profit. Profit = Sale Price - (Purchase + Closing Costs + Renovation + Holding Costs + Sale Commissions). Flipping requires precise cost accounting because even small oversights in holding costs (property tax, insurance, utilities during renovation) or closing costs (realtor commission, transfer fees) drastically reduce final profit. Understanding these calculations prevents costly mistakes and helps determine if a flip is financially viable before committing capital.
The calculator sums all costs: purchase price plus closing costs, renovation budget, and holding costs (monthly amount × holding period). It then subtracts all sale-related expenses from sale price: agent commission (percentage of sale price) and closing costs on sale. Net proceeds minus total cost equals flip profit. ROI percentage shows return relative to capital invested. Monthly equivalent divides total profit by holding duration, showing profitability per month—useful for comparing flips with different timelines.
Total Cost = Purchase + Purchase Closing + Renovation + (Holding Cost/Month × Holding Months). Net Proceeds = Sale Price - (Sale Closing + Sale Commission). Flip Profit = Net Proceeds - Total Cost. ROI % = (Flip Profit / Total Cost) × 100. Monthly = Flip Profit / Holding Months.
Property tax, home insurance, HOA fees, utilities (if you're covering them), and vacancy/marketing costs during holding period. In some regions, add property maintenance, security, or lawn care if applicable. Use past property records or tax assessments to estimate. Average is 1–2% of purchase price per month.
Holding costs (tax, insurance, utilities) compound monthly. Even if you're not actively working, the property 'costs' money to maintain. A 6-month flip with quick sale beats a 12-month flip with same profit because monthly costs are halved. Longer holding also increases interest costs if financed.
If you're doing work yourself, yes—assign an hourly rate (even if unpaid in practice) to account for your time's opportunity cost. Many flippers fail because they undervalue their labor. If contractor does the work, that's your renovation cost.
20% is minimum for risk; 30–50% is competitive; 50%+ is exceptional. Your ROI must account for holding duration. A flip yielding $50k in 6 months (50% ROI annualized) is better than $50k in 12 months (25% annualized). Compare annualized returns across flips.
