Verify more than purchase price and a projected after-repair value. A grounded flip analysis should include property condition, acquisition and closing costs, financing, repair scope, permits, labor, utilities, insurance, taxes, holding time, resale costs, contingency, and a realistic exit timeline. The goal is not a perfect forecast; it is a complete enough model to understand the risk you are taking.
Start with condition and scope
A repair budget depends on the actual home, not a generic percentage. Condition findings, specialist reviews, permits, local code considerations, contractor availability, and the scope of work can all change the number.
Write down what you have seen, what a qualified person has assessed, and what has not yet been reviewed. Those three categories should not be blended into one confident spreadsheet cell.
Include time as a cost
Holding time can affect financing, insurance, utilities, taxes, maintenance, and the window in which the intended exit must happen. Build a timeline and ask what each additional month costs before treating speed as a given.
Treat the exit as an assumption to test
A resale or rental strategy depends on market, property, financing, and buyer or tenant factors that can change. Use reasonable scenarios and plan for variance. Do not present a future sale price or return as a promise.
Questions people ask
Is after-repair value enough to decide if a flip works?
No. A potential future value is one part of the analysis. Condition, scope, financing, timeline, holding costs, resale expenses, and uncertainty can materially affect the outcome.
How much contingency should I use?
There is no universal percentage that fits every property. The appropriate contingency depends on the home, information available, scope uncertainty, financing, and your ability to absorb changes. Discuss project-specific questions with relevant qualified professionals.