How Much Will an Investor Really Pay for Your House

The Real Math Behind an Investor's Number

Most cash investors do not pick a number out of thin air. They run one formula: after-repair value times 0.70, minus repair costs. Real estate investors call it the 70% rule, and it caps what an investor will pay so the deal still works once repairs, financing costs, and profit margin get subtracted.

$100,000 after-repair value. $20,000 in needed repairs. $50,000 maximum offer. That's the textbook version of the formula, and it's the same math nearly every cash investor runs before they call you back with a number.

Scale it to a real house. A $300,000 after-repair-value home needing $30,000 in repairs caps a standard 70%-rule investor's offer at $180,000: $300,000 times 0.70 is $210,000, minus $30,000 in repairs. The remaining 30% of after-repair value pays for the investor's hard money loan interest, commissions, insurance, title costs, and profit margin, typically 12% to 15% on the deal. None of that is padding. It's the actual cost structure behind the number.

Why the Gap Exists, and Where Cash Flow Deals Fits

That 30% gap is not a trick. It exists because a cash investor takes on real costs a retail buyer never sees: financing the purchase before a resale happens, insurance and taxes while the home sits, and a profit margin that has to clear before the deal is worth doing. If you need speed above everything else, you may accept that trade. If you want to know whether there's a higher, honest number, compare your options before signing anything.

Cash Flow Deals is a Florida real estate investor that gives you the Fast Cash Offer and the Premium Cash Offer together. With the Fast Cash Offer, we buy your house as-is and close. With the Premium Cash Offer, a pre-approved FHA or conventional buyer we already have, ready to go, pays more and buys directly from you. You choose which offer fits.

Here's how Cash Flow Deals helps you compare your options against the 70%-rule number:

1. We review your house's condition and show you both offers so you can compare what you would receive.

2. The number is agreed before any work starts, and it changes only if you agree. The one exception: if something structural surfaces that was not visible or disclosed before we signed — foundation issues, hidden moisture, old wiring, cast-iron drain failure — we re-cost it and bring the number back to you. You decide. You can walk away. We disclose what we know at offer time so this almost never happens. We cover repair costs, and we figure out a way, so nothing comes out of your pocket. With Premium, only what the buyer's lender requires gets fixed, with costs settled from the sale proceeds out of our share. With Fast Cash, you sell as-is without making repairs.

3. With Premium, you give us permission to bring a buyer in our place. Your home may be listed through Silver Door Realty, a licensed Florida brokerage, with a licensed agent and scheduled showings. Your buyer signs a new contract directly with you, their lender funds the purchase, and title passes directly from you to them. The existing closing window is 45 days or less, on a date you help pick. If the buyer's loan falls through, that is our problem, not yours, and you can still take the Fast Cash Offer at its own number; you can compare it with the Premium Cash Offer before deciding.

On that same $300,000 after-repair-value house needing $30,000 in repairs, the $180,000 a standard 70%-rule investor offers gives you a comparison point. The Premium Cash Offer through Cash Flow Deals starts from a different question: what can your house sell for to a real buyer, and what would you receive after everything owed is settled?

What This Means Before You Sign Anything

Compare net numbers, not sticker prices. A traditional listing at full market value looks bigger on paper, but 5% to 6% in agent commission plus 1% to 3% in seller closing costs comes off the top before a seller sees a dollar. Add seller concessions, which typically run 0% to 2%, and the combined reduction on a traditional sale is commonly 8% to 10% of the total sale price.

A cash investor's 70%-rule number already has the discount built in, so there's no commission subtracted afterward, but there's also no room to negotiate once the repair estimate is set. The two paths front-load their costs differently. One shows a full price and subtracts fees later. The other shows a discounted price with nothing subtracted after.

The only way to know which number is actually higher for a specific house is to get a real net figure from more than one source before signing anything. A seller who only sees one offer has no comparison to make, and the formula behind that one offer is rarely explained unless someone asks.