Most fix-and-flip investors don't lose money because they picked the wrong paint color or overspent on countertops. They lose money because they bought the wrong property in the first place.

The best flippers have a systematic screening process that lets them evaluate deals quickly—often in under five minutes—so they can sort through dozens of properties per week and focus their time on the ones that actually pencil out. Whether you're analyzing leads from the MLS, a wholesaler, or a driving-for-dollars list, you need a repeatable framework that tells you fast whether a deal is worth pursuing.

Here's the five-step process experienced investors use to screen fix-and-flip deals in minutes, not hours.

Step 1: Check the After Repair Value (ARV)

Everything starts with After Repair Value (ARV)—what the property will be worth once it's fully renovated and ready for market. If you get this number wrong, every other calculation falls apart.

For a quick screening, you don't need a full appraisal. You need a reasonable estimate based on comparable sales:

Pull 3-5 recent sales of renovated homes in the same neighborhood within the last 3-6 months
Match key attributes: similar square footage (within 15-20%), same bedroom/bathroom count, comparable lot size
Focus on sold prices, not active listings—what sellers are asking is irrelevant; what buyers are paying is what matters
Adjust for obvious differences: a comp with a pool, finished basement, or extra garage bay should be adjusted downward if your subject property won't have those features

For example, if three renovated comps in the area sold for $240,000, $255,000, and $248,000, you'd estimate an ARV of roughly $248,000.

At the screening stage, round to the nearest $5,000 and lean conservative. You can always refine the number later with a full comparative market analysis before making an offer.

Step 2: Estimate Repair Costs

The second number you need is your total repair cost—what it will take to bring the property from its current condition to a retail-ready finish.

For a quick screen, use a category-based approach rather than trying to price out every individual line item. Here are the major categories and typical cost ranges for a standard 3-bed/2-bath single-family home:

Roof: $7,000-$12,000 (full replacement) or $500-$2,000 (repairs only)
HVAC: $5,000-$8,000 (full system) or $500-$1,500 (tune-up/repairs)
Kitchen: $8,000-$25,000 depending on scope (cosmetic refresh vs. full gut)
Bathrooms: $3,000-$8,000 per bathroom
Flooring: $3-$7 per square foot installed
Interior paint: $1.50-$3.00 per square foot
Electrical: $2,000-$5,000 (panel upgrade + updates)
Plumbing: $2,000-$5,000 (typical residential repairs)
Exterior (siding, landscaping, driveway): $3,000-$10,000

Add a 10-15% contingency buffer on top of your total. Surprises are a feature of renovations, not a bug.

If you're screening a deal from photos or a listing description without physically walking it, use the higher end of each range. You can tighten the numbers after an in-person walkthrough.

Quick screening shortcut: For a rough sanity check, multiply the home's square footage by $25-$50/sqft for a full renovation or $10-$20/sqft for a cosmetic refresh. A 1,500 sqft home needing a full rehab should budget $37,500-$75,000. If your itemized estimate falls way outside this range, double-check your assumptions.

Step 3: Run the 70% Rule

Now you have two numbers: ARV and repair costs. Plug them into the 70% rule—the most widely used formula in fix-and-flip investing:

Maximum Allowable Offer (MAO) = ARV × 0.70 − Repair Costs

This gives you the absolute maximum you should pay for the property. The 30% gap between ARV and your multiplier covers your profit margin, holding costs, closing costs, and realtor commissions.

Using our example:

ARV: $248,000
Repair costs: $55,000

MAO = $248,000 × 0.70 − $55,000 = $173,600 − $55,000 = $118,600

If the property is listed at or below $118,600, it passes this screening filter. If it's listed at $160,000, you're already $41,400 over your maximum—time to move on unless you believe there's significant negotiating room.

When to adjust the percentage

The 70% figure is a starting point, not a fixed law:

Use 75% in hot, competitive markets where properties sell fast after renovation
Use 65% for properties with major structural issues, slow-selling neighborhoods, or when this is one of your first flips
Use 60% if you're wholesaling the deal and need to leave room for your fee plus the end buyer's profit

Match the percentage to your market and risk tolerance.

Step 4: Calculate Your Projected ROI

The 70% rule tells you your maximum purchase price—but what's the actual return? ROI answers that question and lets you compare this deal against other opportunities.

Here's the calculation:

ROI = Net Profit ÷ Total Investment × 100

Where:

Net Profit = ARV − Purchase Price − Repair Costs − Holding Costs − Transaction Costs
Total Investment = Purchase Price + Repair Costs + Holding Costs + Transaction Costs

Let's say you negotiate the purchase down to $110,000:

| Cost Category | Amount | |---|---| | Purchase price | $110,000 | | Repair costs | $55,000 | | Holding costs (4 months) | $6,000 | | Transaction costs (closing + commissions) | $18,500 | | Total investment | $189,500 |

Net Profit = $248,000 − $189,500 = $58,500

ROI = $58,500 ÷ $189,500 × 100 = 30.9%

Most experienced flippers target a minimum 15-20% ROI or a minimum $25,000-$30,000 net profit, whichever is higher. A deal with a 30% ROI and $58,500 in projected profit clears both thresholds comfortably.

If you're financing the purchase rather than paying cash, calculate your cash-on-cash return instead—that's your net profit divided by just the cash you put in (down payment, rehab costs, closing costs). With leverage, your cash-on-cash return can be significantly higher than your overall ROI.

Step 5: Make a Go/No-Go Decision

You've got your numbers. Now run through a quick checklist to decide whether to pursue the deal or move on:

Green lights (proceed to deeper analysis)

Purchase price is at or below your MAO
Projected ROI is 15%+ and net profit exceeds $25,000
ARV is supported by at least 3 solid comps
Repair scope is within your experience level
The neighborhood has strong buyer demand (low days-on-market for recent sales)

Yellow flags (proceed with caution)

Only 1-2 comparable sales available—ARV confidence is low
Repair estimate includes a major unknown (foundation, environmental, permits)
The property has been sitting on market for 60+ days—why hasn't anyone else taken it?
HOA or deed restrictions that could limit renovation scope
You'd need to stretch above your MAO by 5-10% to win the deal

Red flags (walk away)

Purchase price is more than 10% above your MAO with no room to negotiate
ROI falls below 15% even with optimistic assumptions
Limited exit strategy—no recent sales in the area to support ARV
Zoning, title, or structural issues that create unpredictable costs
The deal requires you to take on more risk than you're comfortable with

If the deal passes your screening, move to detailed due diligence: schedule a property walkthrough, get contractor bids, pull a title report, and verify your comps with a full CMA. But if it fails the five-minute screen, don't waste time going deeper—move on to the next lead.

How Rentzilla Speeds This Up

Each of these five steps involves research, math, and judgment calls. When you're doing it manually—pulling comps on one tab, estimating repairs on a spreadsheet, running formulas on a calculator—a five-minute screen can easily turn into thirty minutes or more.

Rentzilla was built to compress this entire workflow:

Comparable sales are pulled automatically based on the property's location, giving you an ARV estimate in seconds
Repair costs are generated using a detailed category-based cost engine with real pricing data, so you're not guessing at numbers
The 70% rule and MAO are calculated instantly once your ARV and repair costs are dialed in
ROI projections factor in holding costs, transaction costs, and financing to give you a complete profit picture
Professional PDF reports let you document your analysis and share it with partners, lenders, or your team

Instead of juggling spreadsheets and browser tabs, you get a single dashboard that walks you through each step. Analyze more deals in less time, and never miss a good opportunity because you were too slow to run the numbers.

See how it works →

Frequently Asked Questions

How accurate is a five-minute deal analysis?

A five-minute screen isn't meant to replace full due diligence—it's a triage tool. The goal is to quickly determine whether a deal is worth investigating further. If a property fails the five-minute screen, deeper analysis almost never saves it. If it passes, you move to the next phase: contractor walkthroughs, verified comps, and title work. Think of it as a filter that saves you from wasting hours on deals that were never going to work.

What if I can't find enough comps to estimate ARV?

Limited comps are a warning sign, but not always a dealbreaker. If the neighborhood has very few recent sales, try expanding your search radius slightly (within the same school district or comparable area) or looking back 6-12 months. If you still can't find 3+ relevant comps, proceed with extreme caution—your ARV estimate has a wide margin of error, and you should adjust your offer percentage downward (use 65% instead of 70%) to build in a larger safety buffer.

Should I use the 70% rule for every market?

No. The 70% rule is a national average guideline. In competitive, high-appreciation markets (parts of Florida, Texas, Phoenix), investors regularly pay 75-80% of ARV minus repairs because properties sell quickly and values trend upward. In slower markets or areas with declining values, you may need 60-65% to protect your margin. Talk to active investors in your target market to understand what percentages local buyers actually work with.

What's the biggest mistake new flippers make when analyzing deals?

Overestimating ARV and underestimating repairs—at the same time. New investors tend to cherry-pick the highest comp to justify a higher ARV, then use the lowest possible repair estimate to make the numbers work. This "best case scenario" approach leads to buying properties that look profitable on paper but lose money in reality. Always use conservative assumptions during screening. If a deal still works with conservative numbers, it will work even better when things go right.

How many deals should I analyze before finding a good one?

In most markets, experienced investors analyze 20-50 properties for every deal they actually pursue. If you're finding deals on every other property you look at, you're probably not being selective enough. A high screening-to-purchase ratio is normal and healthy—it means you're being disciplined about only buying properties where the numbers truly work. This is exactly why speed matters: the faster you can screen deals, the more you can evaluate, and the better your chances of finding the ones worth pursuing.

How to Analyze a Fix-and-Flip Deal in 5 Minutes