All Forum Posts by: Jimmy Wellman

The 70% rule suggests buying a property for 70% of its ARV minus repair costs to ensure profit. For example, if a home's ARV is $100k and repairs cost $15k your target purchase price would be $55k.

In 2023, gross ROI for flips averaged 27.5%, but net ROI (after all costs) is usually 10-20%, calculated on the total investment (purchase price + repairs).

For a $70k home with $15k in repairs, selling at $100k might net $10k-$15k, or 12%-18%. If you hire a team, expect to spend 10-20 hours/month managing a 4-6 month flip.

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I've looked online for some information about the average % of the final home price vs. the price you purchase the home for and found that the home should be purchased for 70% of your home's final sale price. However, when I googled for the gross ROI, it said it was 27.5% in 2023 and I'm very curious about the net ROI. If the purchase price is 70% of the home's final sale price, what portion of the additional 30% is the $ spent on the flip and what portion is the average net gain?

I've heard 10%-20% is the average net gain but I just want to be more clear about it. Is that the percentage gained on the portion spent on flipping or the percentage of the price you bought the home for + the amount it costs to flip?

Can someone help me with an example where I buy a home for $70,000 then flip it until it's $100,000?

How much time on average will I personally spend on this 4-6 month process if I hire a team?

Thanks so much for your help!

-Jimmy

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All Forum Posts by: Jimmy Wellman

Jimmy Wellman has started 1 posts and replied 3 times.

Post: I'd like more specificity about the ROI on an average flip. Can you help?

Post: I'd like more specificity about the ROI on an average flip. Can you help?

Post: I'd like more specificity about the ROI on an average flip. Can you help?