What is the 70% rule in real estate?

The 70% rule says an investor should pay no more than 70% of a property's after-repair value (ARV) minus repair costs. For wholesalers, you also subtract your assignment fee. It's a quick guardrail to protect your margin: MAO = (ARV x 70%) - repairs - fee.

How do I calculate the maximum allowable offer (MAO)?

MAO = (ARV x your rule percentage) - estimated repairs - your wholesale fee. Enter the after-repair value, your repair estimate, and the fee you want to make; the calculator applies the percentage (65%, 70%, or 75%) and returns the most you can offer while protecting that margin.

Is the 70% rule always correct?

No - it's a starting point, not a law. In hot, low-inventory markets investors often go to 75% or higher to win deals; in slower or riskier markets they drop to 65% for more cushion. Use the percentage toggle to match your market and exit strategy, and always sanity-check repairs and ARV against real comps.

Free tool

MAO Calculator

Work out your Maximum Allowable Offer with the 70% rule - factor in the ARV, repairs, and your fee, and get your max offer plus a deal grade instantly. No signup, nothing saved.

The formula

Your Maximum Allowable Offer is the most you can pay and still hit your target profit. The standard wholesaler formula is the 70% rule: MAO = (ARV × 70%) - repairs - your fee. ARV is the after-repair value; repairs is your rehab estimate; the fee is what you want to make on the assignment. Adjust the percentage to fit your market - tighter (75%) in hot markets, more cushion (65%) in risky ones.

Deal analyzer

MAXIMUM ALLOWABLE OFFER ANALYZER

Apply the standard 70% rule. Enter the after-repair value, your repair estimate, and your fee, and we'll work out the most you can offer while protecting your margin.

After Repair Value (ARV)$350,000

$50k$500k$1M

Repair Estimate$45,000

$5k$100k$200k

Your Desired Wholesaling Fee$15,000

$2k$25k$50k

Contract Price / Asking Price$230,000

Configure what the owner insists on or what you intend to secure the buyer contract for.

ARV Margin standard

Your numbers70% Wholesaling Margin

Maximum Allowable Offer (MAO):

$185,000

Calculated: (350,000 ARV × 70%) - 45,000 Repairs - 15,000 Fee

Overpaid/No-Deal

Negative margins! Do NOT lock this home up under contract at this current price.

Asking vs. MAO Difference:$-45,000

Approx. price to your buyer:$200,000

Auto-pull comps & ARV with DealCheck

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From estimate to real numbers

This calculator runs on your inputs. The two numbers that make or break the math are the ARV and the repair estimate - guess those wrong and the MAO is wrong. The fastest way to pin them down is to pull real comparable sales and let a deal analyzer import the property data for you. In our testing, the best-value tool for that is DealCheck - it imports a US property, estimates ARV from comps, and even back-solves the offer for you (see also our DealCheck vs REsimpli comparison).

FAQ

What is the 70% rule in real estate?: The 70% rule says an investor should pay no more than 70% of a property's after-repair value (ARV) minus repair costs. For wholesalers, you also subtract your assignment fee. It's a quick guardrail to protect your margin: MAO = (ARV x 70%) - repairs - fee.
How do I calculate the maximum allowable offer (MAO)?: MAO = (ARV x your rule percentage) - estimated repairs - your wholesale fee. Enter the after-repair value, your repair estimate, and the fee you want to make; the calculator applies the percentage (65%, 70%, or 75%) and returns the most you can offer while protecting that margin.
Is the 70% rule always correct?: No - it's a starting point, not a law. In hot, low-inventory markets investors often go to 75% or higher to win deals; in slower or riskier markets they drop to 65% for more cushion. Use the percentage toggle to match your market and exit strategy, and always sanity-check repairs and ARV against real comps.