Fixer Uppers Homes
 

Real Estate Flipping Cost Analysis

There are costs associated with flipping real estate. Below is a real estate flipping cost analysis to help you with house flipping and making money flipping real estate. When you are flipping real estate, you need to know what costs there are so that you will make the profit you expect and not be surprised with hidden costs of flipping real estate.

Introduction to real estate flipping cost analysis
Real Estate Flipping Cost Analysis

For most things, the gross profit is the difference between selling price and purchase price. However, in real estate flipping, there are other costs you need to consider. Before you buy a real estate property to flip, you need to do a real estate flipping cost analysis of the property to ensure that you will make the profit you expect by flipping this particular real estate. 



 Real estate flipping cost formula

 

  Selling price
- Rehab costs
- Other flipping costs 
-

Profit

Maximum offer 


Other flipping costs

Other flipping costs include:

  • buying costs or costs associated with buying the real estate,
  • holding costs or costs associated with holding the property while you are rehabbing or trying to find a buyer.
  • cost of money or cost of borrowing which is the interests and payments you need to make towards the loan you obtain to acquire this property
  • selling costs or the costs you will incur when you try to sell the house.