Move the sliders to see what the deal really nets after closing, financing, holding and selling costs, and the highest price you can pay and still hit your profit target.
| Party | Cash in | Gets back | Profit | ROI |
|---|
| Case | Sale | Deal net | GC incl. markup | You |
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Assumptions: only the purchase is financed. The mortgage is interest-only for the holding period and is paid off from the sale. The renovation, contingency, closing and holding costs are all paid in cash, which is why cash needed includes them. Selling costs come out of the sale proceeds, so they don't count toward cash needed. All profit is pre-tax; flip profit is usually taxed as ordinary income. Profit or loss is split by the percentages you set. If the GC's reno money is paid back, the GC gets it from the sale before the split. If it is not paid back, it counts as the GC's stake and the split happens on a bigger pool. Overruns the GC pays are never paid back. "Back at cost" swaps the reno price for the GC's real cost (price ÷ (1 + markup)), so the markup stays in the deal and gets split. Scenarios: Good = sale price +3%, contingency unused, one month faster. Bad = sale price −6%, 30% reno overrun, three extra months.