What’s everybodys mathmatic formula for determining what to offer on any deal to ensure a healthy profit(to include repairs, holding costs, declining market, etc)
50% of the value 90 days in the future if youre a flipper.
50% ha? Sounds like a safe and easy way to make an offer. At times I hear 65% (-) repairs (-) predicted holding costs, but I guess it’s always better to offer lower.
If you’re flipping, look at it another way.
ARV - YOUR PROFIT - Rehab costs - closing & holding costs= Max. Purchase price.
By taking your profit FIRST, you ensure you get one. I;ve seen a rule of thumb where the minimum profit is 10k for properties under 100k. Then 15% for propertie over 100k. I’m not sure if that holds true everywhere, but you have decide for yourself what you profit will be. It’s also a good idea to factor in about 2k as an “OOPS” fund. You never know what to epect with rehabbing.