{"type":"rich","version":"1.0","provider_name":"Transistor","provider_url":"https://transistor.fm","author_name":"Danny Buys Houses","title":"The 70% Rule Explained — How Cash House Buyers Actually Calculate Offers","html":"","width":"100%","height":180,"duration":757,"description":"Get more information about how we value your home for the cash offer we make to you: Danny Buys Houses home valuation methodology\nWhen a cash buyer makes an offer on your house, is the number arbitrary—or is there actual math behind it?\nIn this episode, Danny pulls back the curtain on how professional real estate investors evaluate properties and calculate cash offers. He explains the commonly used 70% rule, what “after-repair value” means, how renovation costs affect an offer, and why the difference between an investor’s purchase price and the future resale price is not simply profit.\nUsing a real-world example, Danny walks through the numbers so homeowners can better evaluate an offer and decide whether selling as-is or renovating the property themselves makes the most sense.\nIn This Episode\nWhat the 70% rule is and how investors use it\nHow a property’s after-repair value, or ARV, is determined\nWhy investors compare recently sold, renovated homes nearby\nHow repair costs are estimated and deducted from an offer\nWhy the apparent 30% margin is not all investor profit\nThe selling costs, commissions, financing expenses, taxes, insurance, and holding costs involved in a renovation\nThe risks homeowners face when renovating a property themselves\nWhy renovation projects frequently take longer and cost more than expected\nWhen an investor may be able to offer more than 70% of the property’s renovated value\nHow FHA’s 90-day flipping restrictions can affect an investor’s resale timeline\nThe Basic Cash-Offer Formula\nA commonly used starting point is:\nMaximum cash offer = 70% of the after-repair value − estimated repair costs\nThe after-repair value is the estimated price the home could sell for after it has been fully renovated and updated to meet the expectations of buyers in the current market.\nExample From the Episode\nDanny uses a hypothetical house with an estimated after-repair value of $250,000.\n$250,000 × 70% = $175,000\nIf the property requires approximately $50,000 in...","thumbnail_url":"https://img.transistorcdn.com/A4JKPMdBytvaktXFz-p1LEdttLMXeVmRX2kHrDdxJdU/rs:fill:0:0:1/w:400/h:400/q:60/mb:500000/aHR0cHM6Ly9pbWct/dXBsb2FkLXByb2R1/Y3Rpb24udHJhbnNp/c3Rvci5mbS9lYTdj/OTA3NTViNTkxNTgy/Mzk2MWMwYjljMDM5/YjgwOS5wbmc.webp","thumbnail_width":300,"thumbnail_height":300}