How this number is made
A flip profit is what is left after you buy, repair, carry, and sell. Financing interest belongs in holding costs. Commission and transfer tax belong in selling costs.
- Expected sale should be a price you can support with comparable sales, not the best listing on the street.
- If you are borrowing, put the interest and fees you will actually pay into holding or purchase.
Formula
Profit = sale − purchase − repairs − holding − selling.
Worked example
With the figures already in the form, profit before income tax is $45,000.
Questions
Is tax taken out?
No. A flip is often ordinary income, not a long-term capital gain. The tax is not estimated here.
What if the sale slips?
Every extra month belongs in holding costs. Rerun the page with that month included.