How do you factor holding costs wholesaling deals

[Account Closed]

Im looking to use this formula to calculate my offers on deals to cash buyers who fix and flip. It was suggested that I calculate fixed costs at 15% of the ARV, and the end buyers profit at 30% of the ARV. Is this reasonable? My formula for calculating offers would then be

100K x.30 = (30K Buyers Profit)

100K ARV x.15= (15K Holding costs and fees)

10K-(Repairs)

5 K- (Assignment fee)

100K(ARV)-30K(buyers profit)-15K(Holding Cost)-10K(Repair Cost)-5k(assignment)=40K

Is the 15 percent holding cost eating up too much of the profit or is this realistic?

[Roy S.]

Maybe I'm not understanding something. The buyer will have holding costs and will include that in figuring what he will pay for the property. So even though the wholesaler does not have holding costs, he still needs to include it in figuring what to offer for the property, doesn't he? While I agree it's usually included in the 30% (ie 70% of ARV), it still needs to be considered.