Analyzing potential house flips requires accurate calculations and reliable spreadsheets to make profitable decisions and avoid costly mistakes.
Essential Deal Analysis Tools
- ARV Calculator – Determines after-repair value based on comparable properties
- Repair Cost Estimator – Breaks down renovation expenses
- Cash Flow Analysis – Projects potential rental income if holding the property
- Maximum Allowable Offer (MAO) – Calculates highest purchase price for profit targets
The 70% Rule Calculator
The 70% rule states your maximum purchase price should be 70% of ARV minus repair costs.
| Formula | Example |
|---|---|
| MAX Purchase = (ARV × 0.70) – Repairs | $200,000 ARV × 0.70 = $140,000 – $30,000 repairs = $110,000 max offer |
Free Spreadsheet Resources
- BiggerPockets Calculators
- DealCheck (basic version free)
- Real Estate Excel Templates
Key Metrics to Track
- Purchase Price
- Closing Costs (typically 2-5% of purchase price)
- Holding Costs (utilities, taxes, insurance)
- Renovation Costs (include 10-20% contingency)
- Selling Costs (realtor fees, closing costs)
- Profit Margin (aim for minimum 20%)
Professional Software Options
For serious flippers, professional software provides advanced features and market data integration.
- PropStream – $99/month – Includes comparables, property data, and analysis tools
- Flipper Force – $49/month – Project management and analysis combined
- REIkit – $79/month – Comprehensive analysis and deal tracking
Quick Analysis Checklist
- Pull recent comparable sales (last 6 months)
- Calculate repair costs using local contractor rates
- Add holding costs for expected timeline
- Include selling costs and commissions
- Apply 70% rule for initial offer range
Create a standardized analysis process using these tools to evaluate deals quickly and consistently.
Mobile Apps for On-Site Analysis
- HouseFlip Analysis – iOS/Android
- REI Calculator – iOS/Android
- DealCheck Mobile – iOS/Android
Remember to update your analysis tools with local market data and actual costs from previous projects for increased accuracy.
Additional Analysis Considerations
Market Analysis Tools
- MLS Access – Get direct access to property data and sales history
- Zillow Research – Track neighborhood trends and price changes
- Local Market Reports – Monthly updates on regional real estate metrics
- Census Data – Demographics and population growth indicators
Risk Assessment Factors
- Market Timing – Seasonal sales patterns and price trends
- Neighborhood Analysis – School ratings, crime stats, development plans
- Competition Level – Active listings and pending sales
- Exit Strategy Options – Backup plans if unable to flip quickly
Building Your Analysis System
Documentation Requirements
- Property Photos – Before and after renovation documentation
- Inspection Reports – Professional assessments and findings
- Contractor Bids – Multiple quotes for major work
- Permit Requirements – Local regulations and timeline impacts
Conclusion
Successful house flipping requires robust analysis tools and systematic evaluation processes. Implement multiple verification methods, maintain updated market data, and regularly review your analysis accuracy against actual project outcomes. Combine both digital tools and on-the-ground research for comprehensive property evaluations. Keep detailed records of each analysis to refine your system over time.
Action Steps
- Set up your preferred analysis spreadsheet system
- Build a network of reliable data sources
- Create a standardized evaluation checklist
- Review and update your tools quarterly
- Document lessons learned from each project
FAQs
1. What are the essential calculations needed in a house flipping deal analysis spreadsheet?
Purchase price, repair costs, holding costs (insurance, utilities, taxes), selling costs (agent fees, closing costs), after repair value (ARV), and potential profit margin are the core calculations needed for accurate deal analysis.
2. What is the 70% rule in house flipping, and how do I calculate it?
The 70% rule states that investors should pay no more than 70% of the ARV minus repair costs. Formula: Maximum Purchase Price = (ARV × 0.70) – Repair Costs. This helps ensure adequate profit margin and accounts for expenses.
3. How do I accurately estimate repair costs in my analysis spreadsheet?
Break down repairs into categories: roof, HVAC, electrical, plumbing, cosmetic updates, flooring, kitchen, bathrooms. Get multiple contractor quotes and add 10-20% contingency for unexpected issues. Use local material costs and labor rates.
4. What’s the best way to calculate holding costs in a flip project?
Multiply monthly expenses (mortgage payments, insurance, utilities, taxes, HOA fees) by the estimated project duration. Include loan interest if using financing. Most flips take 4-6 months from purchase to sale.
5. How do I determine the After Repair Value (ARV) for my calculations?
Analyze at least 3-5 comparable properties (similar size, location, features) sold within the last 3-6 months within a 1-mile radius. Adjust for differences in condition, upgrades, and specific features.
6. What profit margins should I aim for in house flipping calculations?
Most successful flippers aim for a minimum 20-30% return on investment (ROI). On a $200,000 purchase, target at least $40,000-$60,000 profit after all expenses and holding costs.
7. How do I calculate financing costs in my deal analysis?
Include loan points, interest rates, origination fees, and monthly payments. For hard money loans, typically calculate 2-4 points upfront and 8-15% interest rate. Factor in both acquisition and construction loan costs if applicable.
8. What selling costs should be included in a flip analysis spreadsheet?
Real estate agent commissions (5-6%), title insurance, transfer taxes, escrow fees, buyer concessions (1-3%), staging costs, and marketing expenses. Total selling costs typically range from 8-10% of sale price.
9. How do I factor in market conditions into my analysis calculations?
Research local market trends, average days on market, seasonal variations, and price per square foot trends. Include price reduction contingency (3-5%) if market conditions are uncertain.
10. What are the key performance indicators (KPIs) to track in flip analysis?
Return on investment (ROI), cash-on-cash return, project timeline, cost per square foot, gross profit margin, and net profit margin. Compare these KPIs across multiple potential deals to identify the best opportunities.
