A promising spread between purchase price and ARV is only the beginning. Run the full project budget and see what is left after the renovation, the loan, the holding period, and the sale.
Buying at $180,000 and selling at $300,000 leaves a $120,000 gross spread. With $40,000 of rehab, $5,000 of closing costs, a $144,000 interest-only loan at 10% for six months, two points, $600 monthly carrying costs, and 7% selling costs, projected profit is $40,320.
How to use the fix and flip calculator
Start with an ARV supported by renovated sold comparables, then enter the price you expect to pay. Build the renovation budget from actual bids and include a contingency within that amount. Add purchase closing costs separately. The financing section estimates an interest-only loan based on the purchase price; it does not assume the lender also funds construction. Finally, enter the months needed to close, renovate, market, and resell. A project that takes longer keeps accumulating interest and operating costs.
What the results include
The result separates net project profit from the cash required to fund it. Loan principal is financing, not an extra project expense: the purchase price already accounts for the asset you bought. Interest and origination points are additional costs. The cash-to-fund estimate includes the portion of the purchase not financed, renovation, closing costs, points, and projected carrying costs before resale. Return on project cost compares profit with all modeled expenses. The estimate is before income taxes.
Stress-test the exit before you buy
Lower the resale price, increase the rehab allowance, and extend the holding period one assumption at a time. This shows which risks can erase the margin. Selling costs should cover the commission, transfer charges, concessions, and other exit costs you expect. Replace illustrative defaults with actual lender terms and local settlement estimates. Construction draws, interest reserves, extensions, and lender minimum-interest charges need to be reflected in your budget when they apply.
Does this calculator include hard money financing?
Yes. It models interest-only borrowing, origination points, and the holding period. The loan is based on the purchase price. Include any construction financing or special lender charges separately in your project assumptions.
Is the entire loan payment counted as an expense?
This model charges interest during the hold. Principal is repaid from the sale proceeds; counting it again as a project expense would double-count part of the purchase price.
How is this different from the flip ROI calculator?
This tool builds a financed project budget. The flip ROI calculator isolates return on total project cost and annualized return using the expenses you already know.
