What is ARV? (After Repair Value)
ARV, or After Repair Value, is the estimated market value of a property after all repairs and renovations are completed. It's the cornerstone metric for fix-and-flip investors and wholesalers.
What ARV Means
ARV stands for After Repair Value. It's the estimated fair market value of a property after all planned renovations, repairs, and improvements have been completed. Unlike the current market value (or "as-is" value), ARV represents what the property will be worth once it's in fully renovated condition.
For example, if you're looking at a distressed property currently worth $150,000 in its run-down state, but it would be worth $280,000 after a full kitchen and bathroom renovation, new flooring, and fresh paint—then $280,000 is the ARV.
Why ARV Matters
ARV is the foundation of every fix-and-flip deal.
Without an accurate ARV, you can't calculate your maximum allowable offer (MAO), estimate your profit potential, or determine if a deal is worth pursuing. Overestimate the ARV, and you'll overpay. Underestimate it, and you'll miss out on good deals.
Determines Maximum Purchase Price
ARV helps you work backward to calculate how much you can afford to pay for a property while still hitting your profit goals.
Guides Renovation Decisions
Knowing the ARV helps you decide which repairs add value and which are just expensive upgrades the market won't reward.
Essential for Financing
Lenders use ARV to determine how much they'll lend on a fix-and-flip loan, typically offering 70-90% of ARV minus repair costs.
How ARV is Calculated
Find Comparable Sales (Comps)
Search for recently sold properties (within the last 3-6 months) that are similar to your subject property in size, condition, location, and features. These are called "comps."
Adjust for Differences
Make adjustments for differences between the comps and your property. If a comp sold for $300,000 but had an extra bedroom, you'd adjust down. If your property will have a renovated kitchen that the comp didn't, adjust up.
Average the Adjusted Values
Take the average of your adjusted comp values to arrive at your estimated ARV. Most investors use 3-5 comparable sales to get an accurate estimate.
ARV vs As-Is Value
After Repair Value (ARV)
- •Property value after renovations
- •Based on recently sold renovated comps
- •Used to calculate maximum offer price
- •Assumes all planned work is completed
As-Is Value
- •Current market value in existing condition
- •Based on distressed property comps
- •What a cash buyer would pay today
- •No improvements or repairs assumed
How Comparable Sales Work
Good comparable sales should meet these criteria:
Recently Sold (3-6 months)
Older sales may not reflect current market conditions
Similar Size (±200 sqft)
Square footage is one of the biggest value drivers
Same Neighborhood (within 0.5 miles)
Location drives value more than any other factor
Similar Bed/Bath Count
A 3/2 is not a good comp for a 4/3
Comparable Condition
Use renovated comps to estimate ARV, distressed comps for as-is value
ARV Formula & Example
Calculation Example
ARV in Layman's Terms
Think of ARV as the "finished product price." When you buy a fixer-upper, you're not paying for what it's worth today—you're paying for what it could be worth once you fix it up. ARV is that future value. It's like buying ingredients at the grocery store for $20 and making a meal you could sell at a restaurant for $60. The $60 is your ARV; the $20 is your as-is value. The difference (minus the cost of cooking) is your profit.
Common Questions About ARV
How accurate is ARV?
ARV is an estimate, not a guarantee. A good ARV calculation using recent, nearby comps is typically accurate within 5-10%. The more comparable sales you use and the closer they match your property, the more accurate your ARV will be.
Can I use Zillow estimates for ARV?
Zillow's "Zestimate" is based on the property's current condition, not its after-repair value. While Zillow can be a starting point, professional investors rely on strong comparable evidence to calculate ARV accurately — ideally sold comps in disclosure markets, or a more conservative mix of active, pending, and modeled value signals in non-disclosure states.
How do I estimate ARV in a non-disclosure state?
In non-disclosure states, sale prices are not always publicly available, so your ARV process has to be more conservative. Use the best sold data you can access, then triangulate with active listings, pending activity, neighborhood fit, and model-based value ranges. The key is not pretending the data is as clean as a disclosure market — it is widening the valuation range and keeping more room in the deal.
What's the difference between ARV and appraisal?
An appraisal is an official valuation conducted by a licensed appraiser, typically required by lenders. ARV is your own estimate of what the property will be worth post-renovation. Your ARV should be conservative and align with what an appraiser would likely conclude.
How do I account for market changes?
Use the most recent comps possible (ideally within 3 months). If you're in a rapidly appreciating or declining market, factor in a margin of safety—either discount your ARV by 5-10% or ensure your profit margin can absorb market swings.
What is ARV vs LTV?
LTV (Loan-to-Value) is the ratio of your loan amount to the property value. Hard money lenders often lend based on ARV, offering 70-75% ARV loans. For example, if ARV is $300,000, a 70% ARV loan would give you $210,000 to cover purchase price and rehab costs.
Turn ARV Into a Cash Offer Today
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Related Guides
What Is MAO?
Understanding Maximum Allowable Offer and the 70% rule for wholesaling
Read Guide →How to Find Off Market Deals
Strategies for sourcing properties before they hit the MLS
Read Guide →Rehab Cost Per Square Foot
Regional cost breakdowns for light, medium, and heavy renovations
Read Guide →