What is the 70% rule in real estate?+
The 70% rule is a quick-screen formula for fix-and-flip deals: never pay more than 70% of the after-repair value (ARV) minus rehab costs. Formula: Maximum offer = (ARV × 0.70) − Rehab. So a property with a $300,000 ARV and $40,000 rehab gives a max offer of $170,000. The 30% margin covers your closing costs, holding, financing, realtor fees, and profit.
Is the 70% rule still relevant in today's market?+
Yes for screening, but it's a starting point, not gospel. In hot markets with strong appreciation, experienced flippers sometimes go to 75%. In slow or declining markets, smart investors tighten to 65%. Freddie's 70% rule check is the first filter — but the full deal score factors in financing costs, holding time, and current market conditions to give you a more accurate read.
Is this 70% rule calculator actually free?+
Yes. Anyone can run unlimited 70% rule checks on any property at no cost. Free registered users also unlock the Score Certificate PDF, which formalizes the maximum offer math into a one-page document you can share with a seller, partner, or hard money lender. Most flip-focused tools charge $20-100/month for similar features.
Does the 70% rule include rehab costs in the offer or separately?+
Separately. The formula is (ARV × 0.70) − Rehab = Max Offer. Rehab is subtracted from the ARV-times-70%, not added to your offer. A common rookie mistake is calculating ARV × 0.70 and offering that, forgetting to subtract rehab. Freddie applies the formula correctly every time and shows you the math step-by-step.
What if my deal fails the 70% rule but I still want to do it?+
Run the full deal score. The 70% rule is a screen, not the whole picture. A deal that fails the 70% rule by $5,000 might still pencil if rehab time is short, financing is cheap, or you have a guaranteed end buyer. Freddie computes both — the rule check AND the full ROI/profit math — so you can make an informed call instead of walking away from a deal that might still work.
Do I need an account to use this calculator?+
No account required to run the 70% rule check and see your score. A free account unlocks the Score Certificate, saves your deals to a dashboard, and gives you 2 lifetime Rentcast lookups for verified ARV comp data.