The 70% Rule Explained: How to Calculate Maximum Purchase Price
The 70% rule is the most widely used formula in fix-and-flip investing. Learn how it works, when to use it, and when to break it.
The best flip deals rarely hit the MLS. Build a pipeline of off-market opportunities with these proven strategies.
Off-market deals are properties that are for sale but not listed on the Multiple Listing Service. Because they aren't exposed to the broader market, they typically have less competition and can often be acquired at a discount. For fix-and-flip investors, building a reliable off-market deal pipeline is a major competitive advantage.
Direct mail campaigns targeting distressed property indicators (tax delinquency, code violations, pre-foreclosure, absentee owners, probate) remain one of the most effective methods. Response rates are typically 0.5–2%, so volume matters. A consistent monthly campaign of 2,000–5,000 mailers to a well-curated list can generate 2–5 viable leads per month.
Driving for dollars — physically driving neighborhoods to identify distressed properties — is free and highly targeted. Look for overgrown yards, boarded windows, accumulated mail, and deferred maintenance. Tools like DealMachine can streamline the process by instantly pulling owner information and adding properties to your CRM.
Networking with wholesalers, probate attorneys, estate liquidators, and property managers creates a referral-based deal pipeline. Attend local real estate investor meetups, join online forums, and build genuine relationships. The best wholesalers save their best deals for their most reliable buyers.
Other channels include courthouse auctions, tax lien sales, bank REO departments, and online platforms like Auction.com. Each channel has its own learning curve, risk profile, and deal flow characteristics. Diversifying across multiple channels creates a more resilient pipeline.
Related Articles
The 70% rule is the most widely used formula in fix-and-flip investing. Learn how it works, when to use it, and when to break it.
From acquisition to sale, follow the complete lifecycle of a profitable flip and learn what makes each phase successful.
Speed matters in competitive markets. Learn to quickly screen deals and identify winners before the competition.