The seller told us what they thought they could get from a realtor selling the house, we subtracted what the real estate commissions would have been and put the house under contract.

The seller told us what they thought they could get from a realtor selling the house, we subtracted what the real estate commissions would have been and put the house under contract.

The seller told us what they thought they could get from a realtor selling the house, we subtracted what the real estate commissions would have been and put the house under contract.

The seller told us what they thought they could get from a realtor selling the house, we subtracted what the real estate commissions would have been and put the house under contract.

Why are you not subtracting the rehab costs in your final equation.

Then, take the amount you could refi out based on that ARV and subtract your purchase costs.

These add to your balance sheet net worth and is recouped upon divestment of the property.Things you need to subtract from cashflow to get profit:- Accrual for capital expenditures and maintenance (sometimes referred to as reserve)- Accrual for future vacancy- Depreciation if you are accounting for taxation purposes

When you analyze you start with the rent, then subtract your minimum CF (always pay yourself first), then the rest of the expenses (except the loan pmt). 

Subtract that from the offer

Sure…if you take the time value of money and subtract all the expenses, mortgage etc…I may have only come out slightly ahead, if not in the red.