After Repair Value (ARV) is the estimated market value of a property after planned renovations are complete. It is the starting point for every fix-and-flip and BRRRR analysis, because all other numbers — maximum purchase price, rehab budget, and expected profit — flow backward from the ARV.
How to Estimate ARV Using Comps
ARV is determined using the sales comparison approach: find recently sold comparable properties (comps) in the same neighborhood that are similar to what your property will look like after renovation. Ideal comps are within 0.5 miles, sold within 90 days, and within 10–15% of your subject property's square footage. Adjust for differences in bed/bath count, lot size, garage, and condition. Average the adjusted values of 3–5 comps to arrive at your ARV estimate. The closer and more recent the comps, the more reliable your ARV.
The 70% Rule
The 70% rule is the standard quick-filter used by fix-and-flip investors: Maximum Purchase Price = (ARV × 70%) − Estimated Rehab Costs. The 30% buffer covers holding costs, selling costs (agent commissions, closing costs), and target profit. If a property has an ARV of $250,000 and needs $40,000 in repairs, the 70% rule suggests paying no more than $135,000. Use the Fix and Flip Calculator to model this with your specific cost assumptions.
ARV in the BRRRR Strategy
In the BRRRR method, ARV determines how much you can pull out in the refinance step. Most lenders will lend 70–75% of ARV on a cash-out refinance after renovation. If your ARV is $300,000 and the lender offers 75% LTV, you can refinance for $225,000. Subtracting your acquisition and rehab costs from this figure tells you how much cash you recover — ideally enough to recycle into your next deal.
ARV vs Current Purchase Price
The spread between purchase price and ARV is your gross value-add opportunity. Experienced investors look for deals where ARV is at least 30–40% above the all-in cost (purchase + rehab + carrying costs). Thin spreads leave no margin for cost overruns, longer-than-expected holds, or softer market conditions at the time of sale — the three most common ways fix-and-flip deals underperform.