Making a cash offer is easy, and oftentimes we just follow the formula ARV * 70% - Repairs = MAO ARV = After Repaired Value MAO = Maximum Allowable Offer Why 70%? This covers holding costs, unknowns, gotchas, and our margin. If you list the home with an agent, they'll often charge 6 or 7%, and then you're sitting on the market for 30-60 days before you get the sale, (at a minimum). When we buy your home, we have to bring in new cash, so the 70% includes the cost of that money (it's not free), and our margin which is usually 8-9% of the sale price. Holding costs and risk often eats up what is perceived as a huge cut in price. This formula is solid, but in a sketchy (or falling) market, I'll often times reduce that to 65%, then don't forget to back out repairs. See a video explaining this further here.