Understanding Rehab ROI
How we calculate. ROI % = (after-repair value − all-in cost) ÷ all-in cost × 100. The form uses the same arithmetic as the worked examples on this page. See our methodology and accuracy policy.
Real-world scenario: A typical Rehab ROI case uses after-repair value (arv) 320000 and total project cost 250000. Enter the same figures below to reproduce the worked path.
What is Rehab ROI?
A simple project return screen for rehabs and flips. Selling costs and taxes may need separate haircuts.
- Define all-in cost clearly
- ARV should be supportable
- Not a cash-on-cash metric unless cost = cash in
The Formula
Worked Example
Common Use Cases
- Flip underwriting: deal screens
- Contractor bids: cost vs ARV
- BRRRR planning: value-add checks
Pro Tips
- Include holding costs
- Haircut ARV for sell costs
- Stress rehab overruns
Limitations: Rehab ROI results are educational real-estate planning aids—not appraisals, loan offers, or investment advice. Confirm figures with qualified professionals.
FAQ
Is this the 70% rule?
No—this is ROI on cost. The 70% rule is a different offer heuristic.
What if total cost is 0?
ROI is undefined—enter positive project cost.
Authoritative References
For real estate investing concepts, consult:
- National Association of Realtors — market context
- Investopedia — NOI — net operating income basics
- CFPB — homebuying education