The MAO of Real Estate Investing

MAO is the "maximum allowable offer" that an investor should make on a property. The calculation is either 65% or 70% of the after repair value (ARV) less repairs and other costs. The MAO formula calculates an offer price that should allow an investor to make a profit while reducing the chance of losing money on the deal. This formula is mainly used for an all cash offer on a property that the investor intends to flip.