How Many Addresses Do You Analyze to Buy One Flip? Funnel Math and a Two-Tier Triage Workflow

Your Deal Funnel Is a Time Budget, Not Just a Lead List

Most investors treat deal flow as a lead problem. If they aren't closing flips, they buy another list, add another wholesaler, or set up more MLS alerts. But every flip moves through four stages: addresses analyzed, offers made, offers accepted, and deals closed. Properties drop out at every stage, so the number at the bottom depends on how many addresses you can push through the top with real analysis behind them.

Here is a hypothetical funnel to show the math. Say you make an offer on 1 out of every 10 addresses you analyze, sellers accept 1 out of every 5 offers, and 4 out of 5 accepted contracts close after inspection, financing, and title. Multiply the stages: 0.10 x 0.20 x 0.80 = 0.016. That works out to one closed flip for every 62.5 addresses analyzed. If you want 4 flips this year, you need to analyze about 250 addresses, or roughly 5 per week, every week.

Those ratios are for illustration only, and yours will be different. Your market, your buy box, and how aggressive your offers are all change the numbers at each stage. Instead of borrowing someone else's benchmark, keep a simple log with the address, date, ARV, rehab estimate, MAO, whether you offered, whether it was accepted, whether it closed, and why it died. After one quarter you'll have conversion ratios built on your own deals, and those are the only ones worth planning around.

Once you run your own numbers, the bottleneck usually isn't leads. Wholesaler emails, MLS alerts, and driving-for-dollars lists will hand you more addresses than you can process. The real constraint is the hours it takes to pull comps, scope the rehab, and work out a defensible MAO for each one. If careful underwriting eats most of an evening, your weekly analysis capacity is capped by your calendar, not by your inbox.

That's why it helps to treat the funnel as a time budget. You have only two levers: put in more analysis hours, or spend less time on each address that was never going to pencil out. The rest of this article focuses on the second lever.

Worked Example: What 90-Minute Spreadsheet Underwriting Costs You Per Month

Picture an investor who sees 60 potential flip addresses a month from wholesalers, the MLS, and driving for dollars. For each one, they pull sold comps, adjust for square footage and condition, price the rehab trade by trade, and run the MAO. Done carefully in a spreadsheet, that takes about 90 minutes per property. Analyzing all 60 would take 90 hours, which is more than two full work weeks.

Most part-time or even full-time investors can't spend 90 hours a month on underwriting alone. They still have contractors to manage, lenders to call, and current projects to close out. So they do what feels reasonable and fully analyze about 20 addresses (30 hours of work). The other 40 get a quick glance at the listing photos, or nothing at all.

Now run the funnel using this investor's own hypothetical ratios. They make an offer on 1 in 5 properties they fully analyze, and 1 in 4 of those offers gets accepted.

• 20 analyzed: 20 ÷ 5 = 4 offers, then 4 ÷ 4 = 1 deal
• 60 analyzed: 60 ÷ 5 = 12 offers, then 12 ÷ 4 = 3 deals

Same market, same ratios, same investor. The only difference is how many addresses made it through underwriting. If this investor nets a hypothetical $30,000 per flip, the gap between 1 deal and 3 deals is $60,000 a month in potential profit that never had a chance to show up.

That is the real cost of slow analysis. It isn't the 30 hours you spent. It's the 40 addresses you skipped, because you have no idea which of them held the deal that would have penciled out. Your conversion ratios didn't fail you. Your throughput did, and the only fix is a way to screen more addresses without spending 90 minutes on each one.

Worked Example: Tier 1 Screen vs. Tier 2 Full Underwrite on the Same House

Take a three-bed ranch listed at $172,000. Your quick comp pull puts the ARV at $285,000, and a walkthrough of the photos suggests about $48,000 in rehab (kitchen, two baths, flooring, paint). That is enough information for a Tier 1 screen, which should take you minutes, not an evening. The goal is to sort the address into pass, maybe, or kill.

Run the 70% rule: ($285,000 x 0.70) - $48,000 = $199,500 - $48,000 = $151,500 MAO. Against a $172,000 ask, you are $20,500 short. Many investors stop here and toss the lead. But a $20,500 gap on a $285,000 ARV is about 7% of resale value. That is a maybe, not a kill, because the 70% rule is a blunt rule of thumb that bakes in generic cost assumptions.

Now run the Tier 2 full underwrite with real numbers for this deal. Start at $285,000 ARV and subtract $48,000 rehab, $3,000 buying costs, $9,500 holding (5 months x $1,900 for loan interest, taxes, insurance, and utilities), $22,800 selling costs (8% of ARV), and your $30,000 target profit. The result is a $171,700 MAO. The ask is only $300 above that, which is well within normal negotiating range.

The screen alone would have killed a deal that hits your profit target at roughly the asking price. The lesson is not that the 70% rule is wrong. It is that Tier 1 should only kill deals that miss badly (think $40,000 or more short), while anything in the gray zone earns a full underwrite with itemized costs.

The catch is that Tier 2 is the slow part, which is why investors skip it. FlipSmrt returns both layers for an address in under 5 minutes: an ARV from adjusted sold comps within 0.5 miles, line-item rehab by trade priced for the county, the MAO after buying, holding, selling costs and your target profit, plus ROI. That makes a full underwrite on every maybe affordable instead of a luxury.

Where Triage Breaks: Thin Comps, Heavy Scope, and Stale Listings

A fast screen is only as good as the data underneath it. Most addresses fit a familiar pattern: a 1990s ranch in a subdivision with plenty of recent sales nearby and a mostly cosmetic scope. Three situations break that pattern, and they are exactly where a quick verdict can kill a good deal or wave through a bad one. Learn to spot them in the first two minutes.

Thin comps. A farmhouse on 4 acres, a converted church, or the only 3,200 sq ft home in a neighborhood of 1,400 sq ft bungalows will rarely have enough sold comps within 0.5 miles. If the ARV leans on two sales, or on comps that needed big adjustments, treat it as a range instead of a number. Say the screen shows a $310,000 ARV, but $270,000 is just as plausible. That $40,000 gap moves your MAO by $28,000 ($40,000 x 0.70), which is enough to flip the verdict on its own.

Heavy scope. Cosmetic rehabs price predictably by trade. Foundation repair, full guts, and anything behind the walls do not. Pier work can run from a few thousand dollars to well past $25,000 depending on what an engineer finds, and no screen can see inside a crawlspace. When listing photos or remarks hint at structural, sewer, or full electrical replacement, treat the rehab line as a placeholder until a contractor walks the property.

Stale data. A listing that dropped $15,000 last week, went pending and came back, or posted new photos showing water stains no longer matches the screen you ran. Price cuts can turn a no-go into a go, and fall-through relistings often signal an inspection problem. Rerun the address rather than trusting saved numbers.

Use these rules to bump an address past Tier 1:

• Fewer than 3 sold comps inside 0.5 miles in the last 6 months: go straight to Tier 2 and pull wider comps by hand.
• Any foundation, roof structure, or full-gut scope: schedule a site visit with a contractor before making an offer.
• Price change, back-on-market, or relist since your screen: rerun Tier 1 the same day.
• Asking price within $10,000 of your MAO: move to Tier 2, because small errors decide close calls.

Triage Mistakes That Leak Good Deals or Waste Your Week

Treating the 70% rule as a final verdict. The rule is a filter that tells you which houses deserve a full underwrite. It doesn't tell you whether to buy. On a $300,000 ARV with $50,000 in rehab, MAO is ($300,000 x 0.70) - $50,000 = $160,000. A $172,000 asking price fails that screen, but a short hold and cheap financing might still hit your profit target. The fix is to send near-misses within about 5% of MAO to Tier 2 instead of tossing them.

Applying one rehab-per-square-foot number to every house. A flat $35 per square foot on a 1,400 sq ft ranch gives you $49,000. That figure means nothing if the house needs a roof and a sewer line replacement. Fix it by sorting each property into a scope bucket (cosmetic, mid-level, or heavy) with its own rate. Then price the big-ticket trades separately using local labor costs.

Re-analyzing the same address from scratch when the price drops. If you already ran the comps and rehab, your MAO hasn't changed. Only the gap between MAO and the asking price has. Suppose a listing drops from $189,000 to $169,000 against your $160,000 MAO. You can see in seconds that it's still $9,000 too high. Fix this by saving every analysis so a price change becomes a quick comparison, not another 90 minutes of work.

Not logging why you passed. Without a reason code, a deal you rejected on price looks the same as one you rejected for bad comps. Keep a one-word tag for each pass: price, comps, scope, or location. Once a week, review the "price" passes for reductions, because those are the deals most likely to come back into range.

Letting a backlog of unanalyzed leads go stale. A lead that sits for a week is often under contract with someone who moved faster. Set a rule that every new lead gets a Tier 1 screen within 24 hours, even if the full underwrite waits. A quick screen on twenty leads is worth more than a perfect analysis on three after they're gone.

FAQ: Analysis Volume and Triage

How many addresses should a part-time flipper analyze each week? Work backward from your goal and your own conversion rates instead of picking a round number. Say about 1 in 5 screened addresses earns an offer, and about 1 in 15 offers gets accepted. That means roughly 75 screens per closed deal, which works out to about 6 screens a week for one flip per quarter or about 18 a week for one per month. Track your real ratios for 30 days and replace these placeholders with your own.

Should I ever offer on a Tier 1 number alone? Only if the offer is clearly conditional, with an inspection or due diligence period long enough to finish the full underwrite. A Tier 1 screen tells you whether a house deserves your time, not what you should pay for it. On a fast-moving listing, you can submit inside that contingency and confirm comps and scope before the deadline. Never waive inspection on a screen number.

What should I automate first, and what stays manual? Automate the repetitive math first: pulling sold comps, adjusting ARV, rough rehab costs by trade, and the MAO calculation. Walkthroughs, contractor bids, and seller conversations should stay manual because those are where judgment and relationships decide the deal. A tool can flag that a roof looks tired, but only a roofer standing on it can price it. FlipSmrt's first 3 analyses are free, which is enough to run a few addresses you already underwrote by hand and compare the results side by side.

How do I set the gap threshold that triggers a full underwrite? Define the gap as asking price minus your Tier 1 MAO. On a house with a $300,000 ARV and $50,000 in rehab, MAO is ($300,000 x 0.70) - $50,000 = $160,000. If your rule is to advance anything within 10% of MAO, a listing at $175,000 qualifies because the $15,000 gap is under $16,000. Loosen the threshold if too few deals reach Tier 2. Tighten it if most full underwrites die on arrival.