MAO Calculator & Deal Analyzer | 70% Rule
MAO Calculator: Find Your Maximum Allowable Offer
The MAO (Maximum Allowable Offer) is the highest price you can pay for a wholesale deal and still profit. This calculator uses three proven percentage rules — 65%, 70% and 75%. Choose your rule based on market conditions and deal type.
The three rules
- 65% rule (competitive markets): MAO = (ARV × 0.65) − repairs − profit margin. Use when buyers are scarce and you need speed.
- 70% rule (standard): MAO = (ARV × 0.70) − repairs − profit margin. Use in normal markets for fix-and-flip deals.
- 75% rule (slow markets): MAO = (ARV × 0.75) − repairs − profit margin. Use when inventory moves slowly but you want higher volume.
When to use each rule
| Rule | Market type | Deal type | Typical strategy |
|---|---|---|---|
| 65% | Highly competitive | Wholesale (quick exits) | Buy cheap, sell fast, 5–10% profit on assignment |
| 70% | Normal / balanced | Fix-and-flip | Hold 3–6 months, 15–20% profit after repairs and holding |
| 75% | Slow moving | Rental / hold | Long-term hold, 10–15% annual return |
Run your numbers
The Property
Your Profit & Costs
Your Maximum Allowable Offer
| ARV | — |
|---|---|
| Repairs incl. contingency | — |
| Closing costs | — |
| Holding costs | — |
| Target profit | — |
| Total deductions | — |
| Profit as % of ARV | — |
The formula. MAO = (ARV × rule%) − repairs − closing costs − holding costs − target profit. Repairs include your contingency, because contractor estimates are optimistic more often than not. If a calculated MAO comes out negative, the deal does not support your profit target at that rule — either the ARV is too low, the repairs too high, or the rule too aggressive for the property. Estimates for planning only; always verify ARV against recent comparable sales.
Common mistakes to avoid
- Underestimating repairs. Add 15–20% contingency to contractor estimates — the field above does this for you.
- Forgetting holding costs. Include insurance, property tax and utilities for the whole time you own it.
- Using the wrong rule for the market. 70% does not work everywhere; adjust for local conditions.
- Ignoring ARV variance. Get three or more comparable sales and average them for a realistic ARV.
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Frequently asked questions
Why are there three different percentages?
Market conditions change. Fast markets need lower offers (65%) to compete; slow markets can support higher offers (75%). Use the percentage that matches your situation.
What happens if my repair estimate is wrong?
Your MAO becomes too high and your profit shrinks. Always add 10–20% contingency to repair estimates and get multiple quotes.
Can I use this for rentals?
Yes. Use the 75% rule and target properties where the cap rate exceeds 8%. For a full rental analysis, use the rental property calculator instead.
How do I find ARV (after-repair value)?
Pull three to five recent comparable sales of similar properties in the same area and average their sale prices.
Should I adjust the profit margin?
Yes. Wholesalers typically target 5–10% ($5,000–$10,000 per deal). Fix-and-flip investors target 15–25% ($30,000–$50,000+).