How to Calculate Your Max Offer Using the 70% Rule
The 70% rule is one of the most trusted formulas in real estate investing. It helps flippers determine the maximum price they should pay for a property—based on its After Repair Value (ARV) and rehab costs.
The Formula
Max Offer = (ARV × 0.70) – Rehab Costs
This ensures you leave room for profit, closing costs, and unexpected expenses.
Example Scenario
Let’s say:
- ARV = $400,000
- Rehab Costs = $60,000
Max Offer = ($400,000 × 0.70) – $60,000 Max Offer = $280,000 – $60,000 = $220,000
If the seller wants $250K, you walk. If they’ll take $220K or less, you’ve got a deal.
When to Adjust the Rule
- Hot Markets: You might stretch to 75% if resale velocity is high
- Heavy Rehabs: Drop to 65% to protect margins
- Wholesale Deals: Use 60–65% to leave room for your buyer’s profit
HardMoneyMan.com LLC helps investors fund deals that meet the 70% rule—and close fast.
Internal Resources
Explore our Fix & Flip Loans page for full program details.
Check out our Loan Requirements Guide for approval criteria.
Use our 70% Rule Infographic to visualize the formula.