Fix & flip calculator

What is fix and flip in property?

Fix and flip means buying a property that needs work, refurbishing it and selling it again. You earn the difference between selling price and total investment, and rental income plays no part. The fix and flip calculator shows whether that difference is enough.

Because the project usually lasts only months, items count that look minor in a buy-to-let. Closing costs are due in full and do not come back at the sale, and every extra month costs interest and running costs.

How does the fix and flip calculator work?

Profit = selling price − total investment. The total investment is the sum of purchase price, closing costs, renovation costs, holding costs and financing costs. The margin is the profit divided by the total investment.

Closing costs = purchase price × (transfer tax rate of the federal state + your rate for agent, notary and land registry). Holding costs = monthly holding costs × project duration. Financing costs = purchase price × debt share × interest rate ÷ 12 × project duration, which is interest on the full loan with no repayment.

The result is a pre-tax profit. The calculator has no separate field for selling costs such as an agent commission on the sale. Subtract them from the target selling price.

How much does the profit depend on the selling price?

A lot, because the costs are fixed and the selling price is not. So the calculator also shows the profit for a selling price 10% lower and 10% higher. In the example, a profit of €29,250 turns into a loss of €6,750 if the sale brings in 10% less.

The same goes for duration. In the example every extra month costs €700 of interest and €300 of running costs. A six-month delay cuts the profit by €6,000.

Run the project with a cautious selling price and a longer duration before you make an offer.