House Flipping Guide

What Is ARV in Real Estate? How to Calculate After Repair Value

April 2026· 8 min read·House Flip Tools

After Repair Value (ARV) is the single most important number in any fix and flip analysis. Get it right and your deal math is solid. Get it wrong — even by 10% — and you can erase your entire expected profit before you swing a hammer.

This guide explains what ARV means, how to calculate it accurately from comparable sales, common mistakes that inflate it, and how to build a range estimate that protects you against market movement.

ARV Definition: What It Means

After Repair Value (ARV) is the estimated market value of a property after all planned renovations are complete and the property is in its target condition. It's a forward-looking estimate — what buyers will pay for the property after you've transformed it from its current distressed state into a fully renovated home.

ARV is not the same as current value, list price, appraised value, or Zestimate. It's a specific projection: what fully-comparable, recently-sold properties nearby are selling for, applied to your target post-renovation property.

ARV in Context

ARV drives everything: your max offer (70% rule), your projected profit, and your refinance value (BRRRR)

A 10% ARV error on a $300K deal = $30,000 swing in projected profit

How to Calculate ARV from Comparable Sales

The most reliable method for ARV estimation is comparable sales analysis — examining recently sold properties (comps) that are similar to your subject property in its post-renovation state.

Here's the step-by-step process:

Step 1: Define Your Subject Property's Post-Renovation Profile

Before you can find comps, you need to know exactly what your property will look like after renovation. This includes: square footage, bedroom count, bathroom count, finished basement (yes/no), garage, lot size, and condition (fully updated vs. standard renovation).

Step 2: Find Comparable Sales

Search for recently sold properties (not list price — sold price) that match your post-renovation profile. Ideal comp criteria:

Location: within 0.5–1 mile, same neighborhood or subdivision
Time: sold within the last 3–6 months (in fast-moving markets, 90 days)
Size: within 15–20% of your target square footage
Beds/baths: same bedroom count; bathroom within 1
Condition: fully renovated or similar quality to your planned renovation

Data sources: MLS through a licensed agent (most accurate), Redfin/Zillow sold data (accessible, slightly less complete), county property records (free, public).

Step 3: Calculate Price Per Square Foot

For each comp, divide the sale price by the square footage: $/sqft = Sale Price ÷ Square Footage. Then calculate a weighted average across your comps — weighting more recent comps higher.

Step 4: Adjust for Differences

No two comps are identical. Adjust for differences between each comp and your subject property:

DifferenceTypical Adjustment Extra bedroom+$3,000–$8,000 Missing bedroom-$3,000–$8,000 Extra full bathroom+$5,000–$12,000 Superior condition vs comp+3–8% of sale price Inferior condition vs comp-3–8% of sale price Garage (if comp has one, you don't)-$10,000–$25,000 Finished basement (if comp has, you don't)-$15,000–$40,000

Step 5: Apply Adjusted $/sqft to Your Property

Multiply your adjusted average $/sqft by your subject property's square footage. Then build a range: use conservative, midpoint, and optimistic scenarios. Most investors use the conservative estimate for 70% rule calculations and the midpoint for deal analysis.

Common ARV Mistakes That Kill Profit

Using active listings (not sold comps). List price ≠ sale price. Sellers price optimistically; buyers negotiate down. Only use closed sales.
Comparing to distressed properties. Your ARV should reflect your renovated property's value — compare to fully updated comps, not current-condition homes.
Ignoring days on market. A comp that sat 120 days likely sold below true market value due to overpricing. Adjust accordingly.
Not accounting for seller concessions. If a comp closed with $10,000 in seller credits, the effective price was $10,000 lower than the listed sale price.
Using stale data. In rising or falling markets, 6-month-old comps can be significantly off. Weight recent data more heavily.

The Most Dangerous ARV Mistake: Anchoring your ARV to your desired profit. If you need $60,000 profit to make the deal work and work backwards to an ARV that achieves that — rather than estimating ARV objectively from comps — you're setting yourself up for a loss. ARV must be estimated from the market, not from your spreadsheet.

ARV Range vs. Point Estimate

Professional investors rarely use a single ARV number. They build a range:

Conservative ARV (use for 70% rule): lowest of your comps, adjusted down slightly for market uncertainty
Midpoint ARV (use for deal analysis): weighted average of your adjusted comps
Optimistic ARV (use for upside case): highest reasonable comparable, assuming ideal market timing

A deal should work at the conservative ARV. If it only works at the optimistic ARV, it's too risky. Our ARV Estimator from Comps generates all three numbers automatically.

ARV and the BRRRR Strategy

For BRRRR investors, ARV is even more critical because it determines the refinance loan amount. A lender offering 75% LTV on a $240K ARV = $180K loan. The same deal with a $200K ARV = $150K loan — $30,000 less capital returned at refinance, meaning $30,000 more of your own money stays locked in the property.