What Is the 70% Rule in House Flipping?

You want to sell your home fast, so an investor’s promise of a quick, cash sale can sound appealing. There’s no waiting around for showings, buyer financing, or a drawn-out closing process, but that convenience can come with a lower offer. As you compare your options, you keep hearing about the 70% rule and wonder why an investor is offering much less than you expected. What is the 70% rule in house flipping, exactly? Does the rule always apply? Are cash offers fair? Understanding how the 70% rule works can give you a better sense of what a cash buyer considers when deciding how much to offer for your home. Sell Your House Fast With an All-Cash Offer Get an all-cash, no-obligation offer in 24 hours through HomeLight’s Simple Sale platform and close in as few as 7 days. You can also compare the offer with an estimate from a top agent. What is the 70% rule in house flipping? The 70% rule is a formula that many house flippers use to determine the maximum price they should pay for a property. Essentially, it leaves a 30% buffer between the property’s expected after-repair value (ARV) and what a flipper is willing to pay. That remaining 30% isn’t pure profit, as it helps cover renovatio...