Calculate wholesale real estate deal profits: ARV, repair costs, assignment fee, holding costs, and maximum allowable offer (MAO).
An investor finds a distressed 3-bedroom home in a suburban neighborhood. Comps show renovated homes selling for $300,000 (ARV). The property needs a new kitchen, bathrooms, flooring, and paint — estimated $40,000 in repairs. Using the 70% rule:
MAO = $300,000 × 0.70 − $40,000 = $170,000
You negotiate a purchase price of $170,000, assign the contract for a $10,000 assignment fee, and estimate $3,000 in holding costs (taxes, insurance, utilities during the 30-day holding period).
Wholesale Profit: $77,000
The end-buyer's total cost is $170,000 + $40,000 + $3,000 = $213,000, leaving them $87,000 in potential profit (29% of ARV) — a healthy margin for a flipper.
A luxury home in an upscale neighborhood has an ARV of $650,000 but needs extensive structural work — $120,000 in repairs. The seller is motivated and willing to accept $310,000.
| Metric | Value |
|---|---|
| ARV | $650,000.00 |
| 70% MAO | $335,000.00 |
| Purchase Price | $310,000.00 |
| Repair Costs | $120,000.00 |
| Assignment Fee | $15,000.00 |
| Holding Costs | $5,000.00 |
| Wholesale Profit | $200,000.00 |
| ROI on Capital | 44.4% |
The end-buyer acquires the property for $310,000, invests $120,000 in repairs, pays $5,000 in holding costs, and has a total cost of $435,000 against an ARV of $650,000 — a potential $215,000 profit (33% of ARV).
Compare two wholesaling strategies on the same property (ARV: $280,000, Repairs: $35,000, Holding: $2,500).
| Scenario | Purchase Price | Assignment Fee | Total Cost | Profit | ROI |
|---|---|---|---|---|---|
| Low Fee / Fast Deal | $161,000 | $5,000 | $198,500 | $76,500 | 38.5% |
| High Fee / Negotiated | $158,500 | $15,000 | $196,000 | $69,000 | 35.2% |
| Max Profit / Low Offer | $150,000 | $10,000 | $187,500 | $82,500 | 44.0% |
A lower purchase price always increases profit, but finding motivated sellers is key. The assignment fee trade-off shows that a slightly lower fee can make your deal more attractive to end-buyers, helping you close faster.
Real estate wholesaling is the practice of securing a contract to purchase a property at a discount and then assigning that contract to an end-buyer for a fee. You never actually buy the property — you profit by selling your contract rights. The key to successful wholesaling is understanding the numbers: ARV, MAO, repair costs, and your profit margin.
The 70% rule is a real estate investing guideline that says an investor should not pay more than 70% of a property's After Repair Value (ARV), minus repair costs, when purchasing a fix-and-flip property. This built-in 30% margin accounts for:
As a wholesaler, you use the 70% rule to calculate what you should offer. If you can secure a contract below the MAO, you create room for your assignment fee while still leaving the end-buyer a viable deal.
The estimated market value of a property after all renovations are complete. Determined by comparable sales (comps) of similar renovated homes in the area.
The highest price an investor can pay for a property and still make a profit. Calculated as ARV × 70% − Repair Costs. This is the benchmark for your offer.
Your compensation for finding the deal and assigning the contract to an end-buyer. Typically ranges from $5,000 to $15,000 depending on the deal size and market.
Ongoing expenses while the property is under contract: property taxes, insurance, utilities, HOA fees, and any other costs that accrue during the holding period.
A purchase agreement that includes an assignment clause giving you the right to transfer your interest in the contract to another buyer before closing.
Return on Investment measures how much profit you generate relative to the total cash involved in the deal. In wholesaling, this is typically very high since you put little to no money down.
Before you secure your first deal, compile a list of cash buyers, flippers, and landlords in your area. A deal is only valuable if you have someone to assign it to.
An inaccurate ARV is the #1 reason wholesaling deals fall apart. Use at least 3-5 comparable sales, adjust for differences, and always be conservative in your estimate.
Different markets have different rules of thumb. In hot markets, investors may accept a 75% rule. In slower markets, you may need to use 65%. Know your local buyer expectations.
Wholesaling is legal in most states but has specific regulations. Always disclose that you're assigning the contract, use a real estate attorney, and never misrepresent yourself as the owner.
Real estate wholesaling is a strategy where an investor (the wholesaler) finds a distressed property, negotiates a purchase contract at a below-market price, and then assigns that contract to an end-buyer (typically a flipper or landlord) for a fee. The wholesaler profits by selling the contract rights — they never actually purchase or renovate the property themselves.
Wholesaling is one of the most accessible ways to break into real estate investing because it requires little to no capital. Instead of needing a down payment and renovation budget, you need deal-finding skills, negotiation ability, and a network of cash buyers. The wholesale real estate calculator helps you analyze any potential deal quickly by applying the standard formulas that professional wholesalers use every day.
The key to successful wholesaling is understanding the numbers. You need to accurately estimate the After Repair Value (ARV), calculate realistic repair costs, determine the Maximum Allowable Offer (MAO) using the 70% rule, and set an assignment fee that represents fair compensation for your work while still leaving the end-buyer with a profitable deal. Our calculator handles all of this math instantly so you can focus on finding and closing deals.
Experienced flippers and real estate investors use the 70% rule as a quick filter for potential deals. If a property's asking price is above the MAO (ARV × 70% − Repairs), most investors will pass. As a wholesaler, your job is to find properties where you can negotiate a price below the MAO, creating room for your assignment fee while still delivering a deal that meets the end-buyer's criteria.
For example, consider a property with an ARV of $300,000 and estimated repair costs of $40,000. The MAO is $170,000. If you negotiate a purchase price of $165,000, you're $5,000 below the MAO — that's your assignment fee. Set your assignment fee at $10,000 and the end-buyer pays $175,000 total, which is still only $5,000 above the MAO. The end-buyer's math: $175,000 + $40,000 repairs = $215,000 total cost, against $300,000 ARV = $85,000 potential profit (28% of ARV). That's a deal most flippers would be happy to buy.
The most direct method. Target distressed neighborhoods, expired listings, tax delinquent properties, and absentee owners. Build rapport and find motivated sellers.
Send targeted mailers to absentee owners, pre-foreclosures, and probate properties. A 1-2% response rate is typical; follow up persistently to convert leads into contracts.
Build relationships with real estate agents, contractors, and property managers who can refer you to motivated sellers. Offer referral fees for deals that close.
Use Facebook ads, Google ads, and SEO to attract sellers who are searching for "sell my house fast" or "cash for homes" in your target market.
⚠️ Important Disclaimer: This Wholesale Real Estate Calculator is for informational and educational purposes only. It provides estimates based on standard real estate investing formulas (70% rule) and user-provided inputs. Actual results depend on market conditions, negotiation outcomes, repair cost accuracy, closing costs, and many other factors. This calculator does not provide financial, legal, or tax advice. Always consult with qualified professionals (real estate attorney, tax advisor, CPA) before entering into any real estate transaction. Wholesaling regulations vary by state — ensure you understand the laws in your jurisdiction.