property calculator

Maximum Allowable Offer (MAO) Calculator

The 70% rule for wholesaling, shown next to an itemised offer built from the end buyer real costs and profit.

MAO = (ARV × 70%) − Repair Costs − Your Fee, the wholesaling screen that leaves the end buyer roughly 30% of after-repair value for costs and profit. Example: a $320,000 ARV needing $45,000 of repairs with a $12,000 assignment fee gives a maximum offer of $167,000, or 52.19% of ARV, leaving the end buyer about $62,560 of projected profit.

Quick actions: Save inputs, view saved runs, print, share, or export results

Saved Runs

Inputs

After-Repair Value (ARV)$

Repair Costs$

Rule Percentage%

Your Assignment Fee$

Buyer Closing Costs%

Selling Costs (commission + closing)%

Holding Periodmo

Monthly Holding Cost$

Buyer's Target Profit (% of ARV)%

Results

Recommended Maximum Offer

$167,000

70% Rule MAO$167,000

Itemised MAO$190,686

Gap Between the Two Methods$23,686

Offer as a Share of ARV52.19%

Repairs as a Share of ARV14.06%

Assignment Fee$12,000

End Buyer Pays for the Contract$202,686

Buyer Closing Costs$3,814

Holding Costs$4,500

Selling Costs$25,600

Target Profit$38,400

Buyer's All-In Cost$281,600

Buyer's Profit at the Rule MAO$62,560

Tip

Run it before every offer. The number you can pay is arithmetic; the number you want to pay is not.

Formula

Maximum allowable offer formulas

Rule MAO = (ARV × Rule%) − Repairs − Assignment Fee

Itemised MAO =
  (ARV − Selling Costs − Holding − Repairs − Target Profit − Fee)
  ÷ (1 + Buyer Closing%)

Recommended Offer = min(Rule MAO, Itemised MAO)
Buyer Pays = Offer + Assignment Fee

The 70% rule is a proxy: the 30% it holds back stands in for the end buyer's purchase costs, holding costs, resale commissions, and profit, without pricing any of them. The itemised version prices them individually, which is what a flipper actually does before agreeing to take an assignment. When the two agree the deal is ordinary; when the itemised figure comes out lower — common on small deals, long rehabs, and high-commission markets — the rule of thumb is not conservative enough, which is why this calculator recommends the lower of the two.

Step by step

How the calculation works

1After-repair value is the input that matters most and it must come from comparable sales of renovated properties in the same submarket, not listing prices of unrenovated stock. Errors flow through at 0.70 of their size straight into the offer — build it properly with the [after-repair value calculator](/calculators/after-repair-value-calculator).
2Repair costs run over, not under. Use contractor bids where possible; the [property flipping rehab budget calculator](/calculators/property-flipping-rehab-budget-calculator) breaks a scope down line by line so the estimate is defensible rather than a walkthrough impression.
3The assignment fee is carved out of the offer rather than added to it, so raising it lowers what the seller receives while leaving the end buyer's price unchanged. Set it too high and the contract simply does not assign.
4Watch the buyer profit figure. It is what decides whether your deal moves, and if it comes out thin your offer was too high regardless of what either formula said — the [house flipping calculator](/calculators/house-flipping-calculator) is what your buyer will be running on the same property.
5This is investor math for distressed acquisitions and keeps the framing of the [BRRRR calculator](/calculators/brrrr-calculator) and the [house flipping calculator](/calculators/house-flipping-calculator). It is not a general home-buying offer tool. Wholesaling is also regulated differently by jurisdiction, with disclosure requirements in several — settle the contract and the disclosures before the spread.

Related guides

Learn more about this calculation

Guide

House Flipping Guide: How to Calculate ARV, 70% Rule, and Profit Margin

Underwrite house flips with professional precision. Learn how to calculate after-repair value (ARV), maximum allowable offer (MAO), repair contingency, and financing drag.

Site Guide

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

Learn the fastest reliable workflow for using Do The Calculation calculators, reading results, checking formulas, and using save, print, share, and export actions correctly.

Property Tool

After-Repair Value Calculator

The input every other number here is derived from.

Property Tool

House Flipping Calculator

Run the deal the way your end buyer will before you set a price.

Property Tool

BRRRR Calculator

For a buy-and-hold buyer, the rent-and-refinance exit changes the economics.

property calculator

Maximum Allowable Offer (MAO) Calculator

The 70% rule for wholesaling, shown next to an itemised offer built from the end buyer real costs and profit.

Quick actions: Save inputs, view saved runs, print, share, or export results

Saved Runs

Inputs

After-Repair Value (ARV)$

Repair Costs$

Rule Percentage%

Your Assignment Fee$

Buyer Closing Costs%

Selling Costs (commission + closing)%

Holding Periodmo

Monthly Holding Cost$

Buyer's Target Profit (% of ARV)%

Results

Recommended Maximum Offer

$167,000

70% Rule MAO$167,000

Itemised MAO$190,686

Gap Between the Two Methods$23,686

Offer as a Share of ARV52.19%

Repairs as a Share of ARV14.06%

Assignment Fee$12,000

End Buyer Pays for the Contract$202,686

Buyer Closing Costs$3,814

Holding Costs$4,500

Selling Costs$25,600

Target Profit$38,400

Buyer's All-In Cost$281,600

Buyer's Profit at the Rule MAO$62,560

Tip

Run it before every offer. The number you can pay is arithmetic; the number you want to pay is not.

Summary

Key output metrics

Recommended Maximum Offer

$167,000

52.2% of after-repair value, the lower of the two methods

70% Rule MAO

$167,000

Itemised method gives $190,686

End Buyer's Profit at This Offer

$62,560

Against a target of $38,400

D3 visualization

Where the After-Repair Value Goes

The 30% the rule holds back is not profit. It is the end buyer's closing, holding, and resale costs, with a margin left over.

Guide

How to understand and use this calculator

Quick Answer — What Is the Maximum Allowable Offer Formula?

The standard wholesaling formula is the 70% rule: MAO = (ARV × 70%) - Repairs - Your Fee. The 70% leaves the end buyer roughly 30% of after-repair value to cover their purchase costs, holding, and profit.

Rule MAO = ARV × Rule % − Repair Costs − Assignment Fee
Itemised MAO = (ARV − Selling Costs − Holding − Repairs − Target Profit − Fee) ÷ (1 + Buyer Closing %)
Recommended Offer = the lower of the two

Worked example: a property with a $320,000 ARV needing $45,000 of repairs, with a $12,000 assignment fee. The 70% rule gives $320,000 × 0.70 = $224,000, less $45,000 of repairs, less the $12,000 fee — a maximum allowable offer of $167,000, or 52.19% of ARV.

Itemised from the buyer's side — 8% selling costs ($25,600), 5 months of holding at $900 ($4,500), 2% buyer closing costs, and a 12% target profit ($38,400) — the answer is $190,686. The 70% rule is the tighter of the two here by $23,686, so $167,000 is the number to offer.

This is investor math for distressed acquisitions, not a tool for buying a house to live in. Repairs at 14.06% of ARV is a substantial rehab, and both formulas assume you can actually execute it at that number.

How to Use This Calculator: A $320,000 ARV Deal

Start with after-repair value, and start honestly. ARV is what the property sells for finished, supported by comparable sales of renovated properties in the same submarket — not the listing price of unrenovated stock and not what the seller thinks it is worth. Every error in ARV is multiplied by 0.70 and lands straight in your offer. Build it properly with the after-repair value calculator.

Repair costs are the second-largest source of error and they run one way: over. Use contractor bids where you can and a scope-based estimate where you cannot; the property flipping rehab budget calculator breaks the scope down line by line. A $45,000 estimate that turns out to be $60,000 removes $15,000 from someone's profit, and if you have already assigned the contract that someone is your buyer — once.

The assignment fee is your compensation and it is carved out of the offer, not added to it. At $12,000 the wholesaler offers $167,000 and the end buyer pays $179,000 for the contract. Typical assignment fees run in the low thousands to the mid five figures depending on the spread and the market. Setting it too high does not make you more money; it makes the deal undesirable and unassignable.

The buyer profit output is the one that decides whether your deal moves. At the rule MAO the end buyer's projected profit is $62,560 on an all-in cost of $281,600 against a $320,000 ARV. That is a deal a flipper will take. If that number comes out thin, your offer was too high regardless of what the formula said — and the house flipping calculator is the tool your buyer will be running on it.

A Second Example: A Smaller Deal at 75%

Percentages move with market conditions. In a hot market with fast resales, investors sometimes accept 75% or even 80%; in a slow or falling one, 65% is closer to safe. Take a $185,000 ARV with $22,000 of repairs, an $8,000 fee, 4 months of holding at $650, and the same 8% selling costs and 12% target profit — at a 75% rule.

The rule MAO is $185,000 × 0.75 = $138,750, less $22,000 and $8,000, giving $108,750 — 58.78% of ARV. The itemised MAO is $113,137, so once again the rule is the binding constraint, this time by only $4,387.

That narrowing gap is worth noticing. At 70% on the first deal the rule was $23,686 tighter than the itemised calculation; at 75% here it is $4,387 tighter. Push the percentage a little further and the rule stops protecting the buyer at all — at roughly 77% on this deal the two converge, and above that the rule would permit an offer that leaves the end buyer below a 12% profit margin. The rule of thumb is a proxy for the itemised math, and proxies stop working when you tune them.

The buyer's projected profit at this offer is $26,675 on a $162,800 all-in cost. Smaller deals carry proportionally more fixed cost, which is exactly why they need the same margin percentage rather than a smaller one.

Why the 70% Rule Works, and When It Does Not

The 30% that the rule holds back is not profit — it is everything the end buyer spends that is not the purchase price or the rehab. Closing costs on the way in, holding costs while the work happens, agent commissions and closing costs on the way out, and finally a margin for the risk of the whole exercise. On the first example those items total roughly $34,000 before any profit at all.

The rule breaks in predictable places. On very high-value properties, 30% of ARV is far more cushion than the actual costs require, so the rule is over-conservative and you will lose deals to investors doing the itemised math. On very low-value properties, fixed costs consume more than 30% and the rule is not conservative enough. On heavy rehabs, longer timelines mean more holding cost than the rule's flat allowance contemplates. And in a falling market, the ARV itself is the assumption that fails.

The itemised version exists to check the rule, not to replace it. When the two agree, you have a normal deal. When the itemised number is much higher, the rule is leaving money on the table and a competitor will outbid you. When the itemised number is *lower* than the rule — which happens on small deals, long rehabs, or high-commission markets — the rule is dangerous and you should follow the itemised figure. This calculator always recommends the lower of the two for exactly that reason.

Wholesaling has legal constraints that arithmetic does not cover. Assigning a purchase contract is regulated differently across jurisdictions, several require disclosure of your position as an assignor, and some restrict unlicensed wholesaling activity outright. Get the contract and the disclosure right before worrying about the spread. For the investor's own analysis of the same property, the BRRRR calculator covers the rent-and-refinance exit, and the house flipping guide walks through ARV, the 70% rule, and profit margin end to end.

Limitations

This calculator is arithmetic on estimates, and the two estimates that matter most — after-repair value and repair cost — are both outside it. ARV drawn from optimistic comparables or a rehab budget drawn from a walkthrough rather than bids will produce a confident-looking maximum offer that is simply wrong. Neither the rule nor the itemised version can protect against bad inputs; they only propagate them.

It models a single assignment or a straightforward flip. It does not handle double closings and their extra transaction costs, transactional funding fees, wholesale deals assigned to a buy-and-hold investor whose economics differ entirely from a flipper's, subject-to or seller-financed acquisitions, or properties with title defects, liens, occupancy issues, or code violations that must be cleared before resale. Any of those changes the number materially.

Holding costs are entered as a flat monthly figure over a fixed period, which understates the risk asymmetry: timelines slip in one direction. Financing costs for the end buyer are not modelled separately at all — a flipper using hard money at double-digit rates plus points has a materially higher cost base than the itemised calculation assumes, which is another reason to leave the buyer more margin rather than less. This is a general educational tool, not investment or legal advice; wholesaling is regulated differently by jurisdiction, and you should consult qualified professionals before contracting.

Related Calculators

Get the inputs right before trusting the output: the After-Repair Value Calculator builds ARV from comparables, and the Property Flipping Rehab Budget Calculator breaks the repair estimate down by scope. Then run the deal the way your end buyer will, with the House Flipping Calculator for a resale exit or the BRRRR Calculator for a rent-and-refinance one. If the buyer is using short-term financing, the Bridge Loan Calculator prices what that costs them. The House Flipping Guide covers ARV, the 70% rule, and profit margin in narrative form.

Related concepts

After-Repair Value

The finished resale value from renovated comparables. Every other number in a wholesale deal is derived from it.

Assignment Fee

The wholesaler's compensation for transferring a purchase contract. Carved out of the offer, so it reduces what the seller receives.

Spread

The gap between the contract price and what an investor will pay. Wide enough for a fee and a buyer's margin, or there is no deal.

Frequently Asked Questions

What is the MAO formula in real estate?+

Maximum Allowable Offer = (ARV × 70%) − Repair Costs − Your Fee. On a $320,000 after-repair value with $45,000 of repairs and a $12,000 assignment fee, that is $224,000 − $45,000 − $12,000 = $167,000, or 52.19% of ARV.

What is the 70% rule in wholesaling?+

A screening heuristic that caps the total of purchase price, repairs, and your fee at 70% of after-repair value. The 30% held back covers the end buyer's closing costs, holding costs, agent commissions on resale, and profit — roughly $34,000 of costs before any margin on the worked example.

Should I use 70%, 75%, or 65%?+

It tracks market conditions and deal size. Hot markets with fast resales support 75% or occasionally 80%; slow or falling markets argue for 65%. But the higher you push it, the less the rule protects the end buyer — at around 77% on the second example the rule stops being more conservative than the itemised calculation at all.

How much should a wholesale assignment fee be?+

Typically the low thousands to the mid five figures, depending on the spread and the market. It is carved out of your offer rather than added to it, so the seller receives $167,000 and the end buyer pays $179,000 on the worked example. Setting it too high does not earn more; it makes the contract unassignable.

Is MAO the same as a normal home-buying offer?+

No, and treating it as one leads to offers nobody accepts. MAO is investor math for distressed acquisitions, deliberately built to leave a rehab margin for a professional buyer. A retail purchaser buying a house to live in is not solving this equation at all.

What is the difference between the rule MAO and the itemised MAO?+

The rule uses a flat percentage as a proxy for the end buyer's costs and profit; the itemised version prices those costs individually. When they agree you have a normal deal. When the itemised figure is lower — common on small deals, long rehabs, or high-commission markets — the rule is not conservative enough and the itemised number should govern.

How accurate does the ARV need to be?+

It is the single most important input, and errors flow straight through at 0.70 of their size. Use comparable sales of renovated properties in the same submarket, not listing prices of unrenovated stock. An ARV overstated by $20,000 overstates your maximum offer by $14,000 and takes it out of someone's profit.

Does the end buyer's profit matter to a wholesaler?+

Entirely, because it determines whether the contract assigns. At the worked example's offer the buyer projects $62,560 of profit on a $281,600 all-in cost — a deal a flipper will take. If that number is thin, the offer was too high no matter what the formula produced.

Formula

Maximum allowable offer formulas

Rule MAO = (ARV × Rule%) − Repairs − Assignment Fee

Itemised MAO =
  (ARV − Selling Costs − Holding − Repairs − Target Profit − Fee)
  ÷ (1 + Buyer Closing%)

Recommended Offer = min(Rule MAO, Itemised MAO)
Buyer Pays = Offer + Assignment Fee

Step by step

How the calculation works

1After-repair value is the input that matters most and it must come from comparable sales of renovated properties in the same submarket, not listing prices of unrenovated stock. Errors flow through at 0.70 of their size straight into the offer — build it properly with the [after-repair value calculator](/calculators/after-repair-value-calculator).
2Repair costs run over, not under. Use contractor bids where possible; the [property flipping rehab budget calculator](/calculators/property-flipping-rehab-budget-calculator) breaks a scope down line by line so the estimate is defensible rather than a walkthrough impression.
3The assignment fee is carved out of the offer rather than added to it, so raising it lowers what the seller receives while leaving the end buyer's price unchanged. Set it too high and the contract simply does not assign.
4Watch the buyer profit figure. It is what decides whether your deal moves, and if it comes out thin your offer was too high regardless of what either formula said — the [house flipping calculator](/calculators/house-flipping-calculator) is what your buyer will be running on the same property.
5This is investor math for distressed acquisitions and keeps the framing of the [BRRRR calculator](/calculators/brrrr-calculator) and the [house flipping calculator](/calculators/house-flipping-calculator). It is not a general home-buying offer tool. Wholesaling is also regulated differently by jurisdiction, with disclosure requirements in several — settle the contract and the disclosures before the spread.

Related guides

Learn more about this calculation

Guide

Maximum Allowable Offer (MAO) Calculator

Inputs

Results

Maximum allowable offer formulas

How the calculation works

Learn more about this calculation

House Flipping Guide: How to Calculate ARV, 70% Rule, and Profit Margin

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

After-Repair Value Calculator

House Flipping Calculator

BRRRR Calculator

Key facts

Maximum Allowable Offer (MAO) Calculator

Inputs

Results

Key output metrics

Where the After-Repair Value Goes

How to understand and use this calculator

Quick Answer — What Is the Maximum Allowable Offer Formula?

How to Use This Calculator: A $320,000 ARV Deal

A Second Example: A Smaller Deal at 75%

Why the 70% Rule Works, and When It Does Not

Limitations

Related Calculators

Related concepts

Frequently Asked Questions

Maximum allowable offer formulas

How the calculation works

Learn more about this calculation

House Flipping Guide: How to Calculate ARV, 70% Rule, and Profit Margin

How to Use Do The Calculation Calculators: A Practical Step-by-Step Guide

After-Repair Value Calculator

House Flipping Calculator

BRRRR Calculator

Key facts

Key output metrics

Where the After-Repair Value Goes

How to understand and use this calculator

Quick Answer — What Is the Maximum Allowable Offer Formula?

How to Use This Calculator: A $320,000 ARV Deal

A Second Example: A Smaller Deal at 75%

Why the 70% Rule Works, and When It Does Not

Limitations

Related Calculators

Related concepts

Frequently Asked Questions