70% rule

Max purchase ≤ 0.70 × ARV − rehab. A quick sniff test for flip deals.

The 70% rule prices in a 30% margin to cover closing costs, holding costs, selling costs, and your target profit. Useful for screening: if a deal misses the 70% rule by more than a few percent, it likely doesn't pencil. Not a substitute for full underwriting — high-margin flippers may use 65%; in hot markets some operators stretch to 75%.