Question 1

What is the 70% rule in real estate?

Accepted Answer

A quick formula for a maximum wholesale/flip offer: 70% of the after-repair value, minus repair costs and your fee. It bakes in an assumed margin for profit and holding costs so you don't have to build a full pro-forma for a fast first-pass offer.

Question 2

Is 70% always the right percentage?

Accepted Answer

No — it's a common default, not a law. Hotter markets or lower-risk deals sometimes use a higher percentage; higher-risk or slower markets often use less than 70%. This calculator lets the rule percentage move with the deal.

Question 3

What if my maximum offer comes out negative or near zero?

Accepted Answer

That means the repair budget and fee eat up more than the rule percentage of ARV allows — the deal doesn't pencil at these numbers. Either the ARV needs to be higher, the repair estimate needs to come down, or this isn't a deal to pursue at the price being discussed.

Question 4

How do I estimate ARV accurately?

Accepted Answer

Comparable recently-sold, similarly-sized homes nearby in similar finished condition — not the current, as-is listing price of comparable distressed properties, which understates what the home will be worth once repaired.

Max Offer Calculator — The 70% Rule