How to Use This Deal Analyzer

The fix and flip deal analyzer above calculates the key metrics every real estate investor needs before making an offer on a property. Enter your after repair value, purchase price, renovation cost, loan details, and closing costs, and the tool will instantly tell you your projected profit, return on investment, maximum allowable offer, and loan to ARV ratio.

Understanding these numbers before you make an offer is not optional. It is the difference between a deal that makes money and one that looks good on the surface but quietly eats your margin from every direction.

The Key Formulas Explained

Every experienced fix and flip investor lives by a short list of formulas. Here is exactly what this analyzer is calculating and why each number matters.

The 70% rule is the most widely used acquisition filter in fix and flip investing. It says you should pay no more than 70% of the after repair value minus your estimated repair costs. The 30% buffer absorbs your holding costs, financing costs, closing costs, and profit margin. In premium markets like Greater Boston where ARVs are high, the 70% rule still applies but the absolute dollar amounts are larger, which is why the formula works well at every price point.

What the Numbers Are Actually Telling You

A deal analyzer gives you numbers. Knowing what those numbers mean is the real skill.

Gross profit is what you walk away with before taxes. On a fix and flip in Massachusetts at the $500,000 to $800,000 ARV range, experienced investors target a minimum of $80,000 to $120,000 in gross profit to justify the time, risk, and capital commitment. Anything below that and the deal is better passed on in most market conditions.

ROI is the number that tells you whether the capital is better deployed here or elsewhere. A 15% ROI on a six-month flip that ties up $300,000 of capital is a 30% annualized return. That is a compelling use of money in almost any market environment. A 5% ROI on the same capital is a savings account with construction risk. Know the difference before you commit.

Loan to ARV is one of the primary metrics private lenders use when evaluating your deal. At Mayflower Venture Partners, we typically lend up to 75% of ARV on fix and flip projects. A deal that comes in at 65% loan to ARV gives us confidence and typically moves through our process faster than one at 80%. Understanding where your deal sits on this metric before you call us makes the conversation more productive for everyone.

Common Mistakes Fix and Flip Investors Make With the Numbers

Running the numbers is only valuable if you are running the right numbers. Here are the most common mistakes experienced investors still make when analyzing a deal.

Underestimating renovation costs. This is the most common and most costly mistake in fix and flip investing. A scope of work prepared by a contractor who has not walked the property is not a budget. It is a guess. Add a minimum 15% contingency to every renovation estimate on properties you have not fully inspected, and 20% on properties with deferred maintenance or older mechanical systems.

Forgetting carrying costs. Every month the project is open costs you money. Property taxes, insurance, utilities, and loan interest accrue regardless of whether your contractor is on schedule. A six-month flip that runs to eight months has two additional months of carrying costs that were not in the original analysis. The deal analyzer accounts for this through the interest calculation, but make sure your month estimate is realistic, not optimistic.

Using the wrong ARV. The ARV is only as good as the comparables you are using to establish it. In premium Massachusetts markets where supply is constrained and new construction is limited, comparable sales can be scarce. Be conservative in your ARV analysis. A deal that works at a $650,000 ARV and still works at $600,000 is a deal with real margin. A deal that only works at the top of the range is a deal that is one slow market away from a loss.

Not accounting for selling costs. Realtor commissions, transfer taxes, and closing costs on the sale side typically run 5% to 7% of the sale price. On a $600,000 sale that is $30,000 to $42,000 that needs to be in your numbers from day one.

How Your Deal Analyzer Numbers Affect Your Financing

Understanding how lenders look at your deal numbers puts you in a much stronger position when you call for financing. At Mayflower Venture Partners, here is what we focus on when we receive a fix and flip deal.

We look at the loan to ARV first. We want to see a meaningful spread between the loan amount and the after repair value. A deal at 65% loan to ARV has a 35% equity cushion. If something goes wrong and we need to take the asset back and sell it at a discount, that cushion protects both of us. A deal at 80% loan to ARV has very little room for error.

We look at the renovation budget and whether it makes sense for the scope of work. An experienced underwriter who has looked at hundreds of renovation projects in Massachusetts knows what it costs to renovate a kitchen, replace a roof, or gut a bathroom in the current labor and material environment. A budget that is significantly below market rates for the scope described is a flag, not a feature.

We look at your track record. A borrower who has completed ten successful fix and flip projects in the same market with exits at or above their projected ARVs is a very different risk profile than a first-time investor, and our terms reflect that.

We lend on fix and flip projects throughout Massachusetts, Connecticut, Rhode Island, New Hampshire, and Maine. If your deal analyzer numbers look good and you need financing to move on the deal, reach out. We issue term sheets within 24 hours.