After Repair Value (ARV)
The estimated market value of a property after all renovations are completed.
Definition
After Repair Value (ARV) is the projected market value of a property once it has been fully renovated and brought to market-ready condition. It is the cornerstone metric for house flippers, wholesalers, and BRRRR investors.
ARV is typically determined by analyzing recent sales of comparable properties (comps) in the same neighborhood — homes of similar size, age, condition, and features that have sold within the past 90 days. The more closely a comp matches the subject property's post-renovation profile, the more reliable it is.
The ARV drives the Maximum Allowable Offer (MAO) calculation. A common rule of thumb is the 70% Rule: an investor should pay no more than 70% of ARV minus estimated repair costs. For example, if ARV is $200,000 and repairs cost $30,000, the max offer would be ($200,000 × 0.70) − $30,000 = $110,000.
Overpaying relative to ARV is one of the most common and costly mistakes new investors make. Always verify ARV with multiple comps and, when possible, confirm with a licensed appraiser or experienced local agent before committing to a purchase.
Related Terms
Maximum Allowable Offer (MAO)
The highest price an investor can pay for a property and still achieve their target profit.
Comparable Sales (Comps)
Recent sales of similar properties used to estimate the market value of a subject property.
Fix and Flip
Buying a distressed property, renovating it, then selling it quickly for a profit.
BRRRR Method
Buy, Rehab, Rent, Refinance, Repeat — a strategy to recycle capital into multiple rental properties.
Rehab Costs
The total estimated cost to renovate a property, including materials, labor, permits, and contingencies.
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