Augusta
VIP Contributor
The 70% golden rule payment for flippers seem the best rule to adopt to avoid making a loss with your house flipping business.
if you are considering starting out with property flipping it is good to adopt the 70% flipping rate as experienced flippers follow the 70% rule when analyzing how much they’re willing to pay for a house.
The 70% rule is about that investors or flippers not paying more than 70% of the ARV which is the after repair value of a property. Which is always the total cost of the property minus the cost of the repairs required.
How does this works if you are going for a home’ that it's ARV which is value after repairs is $500,000 but will reauires $50,000 for repairs. The 70% rule states that flippers should not pay more than $300,000 for the property This simple rule in calculation means that you find 70% of ARV and substrates the repairs cost .
So this one will be $500,000 x 0.70 = $350,000 – $50,000 for repairs = $300,000
So as a starter either as an investor or a flipper it is good to adopt this rule it can help you avoid overpaying for a home that night bring a loss if you do.
if you are considering starting out with property flipping it is good to adopt the 70% flipping rate as experienced flippers follow the 70% rule when analyzing how much they’re willing to pay for a house.
The 70% rule is about that investors or flippers not paying more than 70% of the ARV which is the after repair value of a property. Which is always the total cost of the property minus the cost of the repairs required.
How does this works if you are going for a home’ that it's ARV which is value after repairs is $500,000 but will reauires $50,000 for repairs. The 70% rule states that flippers should not pay more than $300,000 for the property This simple rule in calculation means that you find 70% of ARV and substrates the repairs cost .
So this one will be $500,000 x 0.70 = $350,000 – $50,000 for repairs = $300,000
So as a starter either as an investor or a flipper it is good to adopt this rule it can help you avoid overpaying for a home that night bring a loss if you do.
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