Use this cash offer calculator to help you determine your offer price based on ARV, rehab estimate, and strategy. This investment property offer price calculator is designed for property in poor condition.
Use our Fix & Flip Profit Calculator to estimate cash to close, profit, and cash-on-cash return.
Fix and flip investors, commonly referred to as "flippers", offer the lowest amount of any buyers. If you're wondering why this is, it's because flippers are looking to maximize their one-time profit on a given property. In order to justify the substantial risk (money and time) of buying and renovating a property in poor condition, the flipper needs to build in a margin of safety. Unlike rental investors, the flipper cannot recoup their investment over many years of increasing rent and property values. The flipper needs to safely account for a worthwhile near-term profit from buying, fixing and re-selling a property. Re-selling the property incurs transaction costs which include staging, photography, seller concessions (1-2%), closing costs (1-2%), and agent commissions (4% - 6%).
Purchase Price = ARV * [65% OR 70% OR 75%] - Rehab Estimate
Wholesalers need to add their fee in, which reduced the offer price accordingly.
Purchase Price = ARV * [65% OR 70% OR 75%] - Rehab Estimate - Wholesale Fee
Rental investors, on the other hand, are focused on the long term (cash flow and property value appreciation), and are willing to pay more.
Rental investors are typically targeting 10% to 25% below market value on their investment.
Purchase Price = ARV * [select: 65% to 85%] - Rehab Estimate
To calculate a cash offer, you need to start with your end-game. What is your goal? Is it to buy a long-term cash-flowing rental property? Or is it to make a quick buck fixing and flipping a distressed property?
At this step, you need to decide what is your target financial return, and on what timeline? Are you looking to make $25,000 net of all expenses with a quick 3 month flip, or are you looking to generate 15% cash on cash annual returns with a long term rental?
Making a cash offer is easy. You can submit your offer terms and we will provide you with our standard investor purchase agreement that you can submit directly to the seller.
Instead of using your own cash to buy a property, you can use a hard money fix & flip loan. A hard money or private lender can typically provide up to 90% of the purchase price and 100% of the rehab cost. Learn more about hard money interest rates and fee, and get a quote from OfferMarket Capital, our hard money private lending division.
If you need to sell your house fast, a cash buyer is the way to go because there are no financing contingencies and risks associated with a lender declining the loan. Use our cash offer calculator to see what type of offer range you should expect if you sell to an investor buyer. You can post your house on our investment property marketplace and compare AS IS offers from verified buyers.