Local market • Los Angeles, CA
House Flipping Calculator for Los Angeles, CA
High-value coastal market with large absolute spreads on cosmetic flips, but steep entry prices, heavy capital needs, and slow permitting; ADU conversions are a common value-add.
Worked example: the 80% rule in Los Angeles
With a median home price around $980,000 in Los Angeles, a flipper using a 80% of ARV rule would target a maximum offer near $666,400 on a property worth $980,000 after repairs with roughly $117,600 of rehab. The classic 70% rule is too conservative here — at a $980,000 ARV, a flat 70% would price you out of nearly every deal. Fixed transaction costs are a smaller share of a high ARV and competition compresses margins, so Los Angeles flippers underwrite closer to 80%.
| After-repair value (ARV) | $980,000 |
| Estimated rehab (≈12% of ARV) | $117,600 |
| 80% of ARV | $784,000 |
| Maximum allowable offer (MAO) | $666,400 |
These are illustrative figures. Run the actual numbers — comps, true rehab scope, holding costs, financing — in the FlipOS deal analyzer for an accurate MAO.
A more accurate MAO: work backward from your costs
The percentage rule is just a shortcut for the real formula — subtract every cost and your target profit from the ARV:
MAO = ARV − rehab − closing − holding − selling − target profit
| After-repair value (ARV) | $980,000 |
| Rehab (≈12% of ARV) | −$117,600 |
| Buy / closing costs (≈2%) | −$19,600 |
| Holding costs (≈3%) | −$29,400 |
| Selling costs (≈6.5%) | −$63,700 |
| Target profit (≈9% of ARV) | −$83,300 |
| Maximum allowable offer (MAO) | $666,400 |
Notice this lands on the same $666,400 as the 80% rule above — the rule just bakes these costs into one number. The trade-off it hides: a higher ARV percentage means a thinner profit margin (9% here), which is exactly why competitive markets like Los Angeles accept tighter spreads. Always confirm rehab, holding, and selling costs for the specific deal.
What flippers should know about Los Angeles
High-value coastal market with large absolute spreads on cosmetic flips, but steep entry prices, heavy capital needs, and slow permitting; ADU conversions are a common value-add. As with any market, the headline median price masks wide variation block-to-block. Pull comps inside a one-mile radius (or tighter in urban submarkets), and confirm rehab costs with at least two local contractors before committing.
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