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Maximum Allowable Offer Calculator

By , Property Rental Calculator

Free calculator that works backward from your target return to the highest price you should offer, instantly.

Your numbers

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Vacancy, management, maintenance, capex, taxes, insurance.

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Results

A screening ceiling based on your assumptions, not an appraisal or an offer recommendation. Rents and rates should reflect real quotes. Not financial advice.

How to use this calculator

Enter the rent, operating expenses, and financing terms, then pick a target: cash-on-cash return, monthly cash flow, the 1% rule, or the 70% rule. The tool solves the maximum price that still hits it as you type.

How each target works

The tool solves the price at which your chosen target is met, holding the rent, expenses, and loan terms fixed. A target cash-on-cash finds the price where annual pre-tax cash flow divided by your cash invested equals your goal. A target monthly cash flow finds the price where the rent, after expenses and the mortgage, leaves you the dollar figure you want. The 1% rule price is simply rent times 100, a fast sanity check. The 70% rule max offer is ARV times 0.70 minus rehab, the flip and BRRRR ceiling.

A worked example

At $2,500 rent, the 1% rule price is $250,000, a quick gut check on whether a listing is even in range. If you are rehabbing toward a $300,000 ARV with $40,000 of work, the 70% rule caps your offer near $170,000. For a buy-and-hold, set a target cash-on-cash and the solver returns the exact price that hits it at your down payment and rate. Raise your rate or target, and the price you can justify drops.

Common questions

Why is my max offer below the asking price?

Because the target you set, plus today's rate and expenses, only pencils at or below that price. That is the tool doing its job. It is telling you the listing does not hit your return at ask, not that the number is wrong.

Which target should a beginner use?

A minimum monthly cash flow is the most intuitive to start with. Cash-on-cash is better for comparing very different deals. The 1% rule is only a first-glance filter, not an analysis.

Does this include closing costs?

Yes, for the cash-on-cash target, your closing and upfront costs are part of the cash invested. They are not part of the 1% or 70% reference prices, which are pure rules of thumb.

Why does it say no price hits my target?

When operating expenses eat most or all of the rent, there is no purchase price that produces a positive return, so the solver has nothing to find. Lower the expense assumption or the target, or the deal simply does not work.

How this is built and kept current

Cedrick Reese, a web developer, built this calculator to solve the purchase price backward from a target return, using the same cash-on-cash and monthly cash flow formulas used elsewhere on this site, plus the standard 1% and 70% rules investors use for a fast first screen. The solver is checked by running its answer back through those same formulas forward, so a price it returns always reproduces the target you set. If the common thresholds behind the 1% and 70% rules shift with the market, this page gets updated to reflect that.

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