Offer Math·November 4, 2026
How Much Profit Should You Require Per Flip?
A fixed dollar floor, a percentage of ARV, or a return on capital deployed — three ways to set the number, and when each one lies to you.
One article a week on the arithmetic behind a deal — what you can pay, what the finished house is worth, what the rehab really costs, and what the lender checks first. No fabricated statistics, no income claims, and every worked example shows its math.
A fixed dollar floor, a percentage of ARV, or a return on capital deployed — three ways to set the number, and when each one lies to you.
Spreadsheets are fine until version four has last quarter’s mistake still in it. The specific failure modes, and what changes when the model is one model.
National gross-profit and ROI figures describe a country, not your ZIP code. What those reports are good for, and the three ways investors misread them.
Deals die from silence more often than from bad math. Explicit stages, one owner, one next action, and a weekly review where stale deals move or die.
Rate and points are not the number that matters. Total cost of capital over your real hold period is, and short holds change the answer completely.
Work backward from your end buyer’s max offer, subtract your fee, contract at or below that. Price it any other way and your list does the math for you, less politely.
The same build, three interest estimates, two of them wrong — and the bonus the drawn-balance curve gives you free: what a delay actually costs by month.
NOI over annual debt service — and the four honest expenses that turn a marketing 1.30 into an underwriting 1.05 before the lender ever sees it.
Permits, dumpsters, utilities during the hold, final clean. The lines that never make the walkthrough list and always make the invoice.
A renovated comp and a tired one are not the same house. How to adjust toward your subject and document why, so the number survives a second reader.
Taxes, insurance, utilities, interest and the HOA nobody budgeted. Priced per month, then multiplied by the timeline you will actually hit.
Three to six renovated closed sales, adjusted toward your subject, cross-checked against median $/sqft. When the methods cluster you have an ARV. When they scatter, the scatter is the finding.
A rule of thumb that works on a $200K house in a normal market and quietly fails on cheap houses, expensive houses, heavy rehabs and slow exits.
The full subtraction, line by line: ARV minus rehab, holding, buying, selling, financing and your required profit — and why the "spread" is usually smaller than it looks.
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