How to Calculate Your Profit on a Fix & Flip Property

November 8, 2026

The Fix & Flip Investor’s Guide | Lulu Capital Inc.

Flipping houses can be a great way to make money in real estate. But before you buy that fixer-upper, there’s one very important question you need to answer:

How much money will I actually make on this deal?

The answer might surprise you. There’s a lot more to calculating fix and flip profit than subtracting the purchase price and renovation costs from the selling price.

Let’s break it down.

The Basic Fix & Flip Profit Formula

Here’s the simplest way to calculate your potential profit:

Expected Selling Price − Total Project Costs = Estimated Profit

Sounds easy enough, right? The trick is making sure you’ve included all your project costs. Missing even a few expenses can make a profitable-looking deal turn into a money loser.

The 6 Costs Every House Flipper Should Calculate

1. Property Purchase Price — This is what you’re paying to acquire the property. Whether you’re buying through a real estate agent, wholesaler, auction, or directly from the owner, this is where your calculation begins.

2. Renovation Costs — Everything required to get the property ready for resale. Think kitchens, bathrooms, flooring, painting, roofing, landscaping, and any unexpected repairs.

3. Financing Costs — If you’re using a fix and flip loan, include the interest you’ll pay, loan origination fees, and other applicable lender charges. These expenses can make a meaningful difference in your final profit.

4. Holding Costs — Every month you own the property costs money. Property taxes, insurance, utilities, maintenance, and other carrying expenses continue even when construction isn’t happening.

5. Selling Costs — When the renovation is complete, you’ll likely have expenses associated with selling the property. These may include real estate commissions, seller concessions, and closing costs.

6. Purchase Closing Costs — Don’t forget title insurance, escrow fees, recording charges, and other transaction expenses associated with purchasing the property.

Let’s Run a Real-World Example

Imagine you’ve found a property that you believe could be a great flip. Here are your projected numbers:

Now let’s assume the property’s After Repair Value (ARV) is $400,000, and you ultimately sell it for that amount.

$400,000 − $369,000 = $31,000 estimated profit.

Not bad! But what happens if the renovation takes two months longer than expected? Or if you have to reduce the selling price by $15,000?

Suddenly, that $31,000 profit starts shrinking. That’s why successful real estate investors run the numbers before making an offer, not after they’ve purchased the property.

This simplified example assumes the costs listed are comprehensive and does not include income taxes. Loan principal is not counted twice: the purchase and renovation expenses are included in project costs, while financing costs represent the additional expense of borrowing.

Don’t Forget to Calculate Your Return on Investment

Profit tells you how many dollars you expect to make. Return on investment (ROI) helps you evaluate that profit relative to the money invested.

For a leveraged fix and flip, it’s especially important to understand the difference between total project costs and your actual cash investment.

For example, making $31,000 on a project requiring $80,000 of your own cash produces a different return than making $31,000 on a project requiring $150,000. Both deals make the same dollar profit, but the returns on your cash are different.

Calculate Your Next Fix & Flip Before You Buy!

At Lulu Capital Inc., we believe every real estate investor should be able to evaluate a potential fix and flip quickly and easily.

That’s why we’ve made our free Fix & Flip Calculator available right on our homepage.

No accounts. No logins. No jumping through hoops.

Just enter your numbers, explore your potential expenses, and get a clearer picture of the deal you’re considering.

Have a property you’re thinking about flipping?

Visit lulucapitalinc.com and run your numbers with our free Fix & Flip Calculator. And if you need financing for your next project, Lulu Capital can help with financing solutions for eligible residential investment properties.

Because the best time to discover whether a flip makes financial sense is BEFORE you buy it!

Lulu Capital Inc. | DRE# 02236931 | Designated Officer/Broker Brenda Garay | DRE# 01490618

Financing is for eligible business-purpose investment properties. Loan terms, eligibility, and availability are subject to underwriting and lender approval. Calculations are estimates and do not guarantee profitability.