To calculate ARV (after-repair value), find 3–5 recently sold, comparable homes near your property, get their average price per square foot, and multiply by your property's square footage — that's roughly what your house will be worth once it's fully fixed up. ARV is the number every other number in the deal depends on, so it's worth getting right. Here's how, with a worked example.
This is education, not investment advice. Always confirm values with a local agent or appraiser before you commit money.
What ARV actually is
ARV = After-Repair Value = the market value of a property after it's been renovated to a normal, sellable condition. It answers one question: "If I fixed this place up, what would it sell for?" You use it to work backward to a safe offer — see the 70% rule.
The comp-based method (the one investors use)
Step 1: Pull sold comps
Find 3–5 comparable properties that actually sold (not just listed) in roughly the last 3–6 months. Good comps are:
- Close by (ideally under ~0.5–1 mile, same neighborhood/school zone),
- Similar in size (within ~20% of square footage),
- Same property type and similar beds/baths,
- Similar in age and style.
Use sold prices — list prices are wishes, sold prices are facts.
Step 2: Get price per square foot
For each comp, divide its sold price by its square footage. Average those figures.
Step 3: Multiply by your square footage
Multiply the average price per square foot by your subject property's square footage. Adjust up or down for meaningful differences (an extra bathroom, a garage, a bigger lot, a premium finish level).
A worked example
Say three sold comps look like this:
- Comp A: $255,000 ÷ 1,500 sq ft = $170/sq ft
- Comp B: $272,000 ÷ 1,600 sq ft = $170/sq ft
- Comp C: $246,000 ÷ 1,450 sq ft = $170/sq ft
Average ≈ $170/sq ft. Your subject property is 1,550 sq ft:
ARV ≈ 1,550 × $170 = $263,500.
That $263,500 is your starting ARV. If your home has one fewer bathroom than the comps, you'd adjust down a bit; a new roof or finished basement, adjust up. Keep adjustments conservative.
The three mistakes that blow up a deal
- Using list prices or stale comps. A house listed at $300k tells you nothing; a house sold at $263k tells you everything. And a comp from 18 months ago in a shifting market can be wildly off.
- Reaching for comps in a better neighborhood. A sale one school district or one "nicer street" over can inflate your ARV and wipe out your margin. Stay tight.
- Being optimistic. Optimistic ARVs make bad deals look good. Estimate conservatively — the same discipline pros preach on tools like the Rocket Mortgage guide to the 70% rule: be conservative on both ARV and repairs.
Why ARV feeds everything else
Once you have ARV, you can find your maximum offer with the 70% rule: (ARV × 0.70) − repairs. Get ARV wrong and every downstream number is wrong. That's why learning to run comps is a core skill for wholesalers and flippers alike.
The come-up move
ARV isn't guesswork — it's a repeatable process: sold comps, price per square foot, conservative adjustments. Do it the same way every time and your offers get sharper.
Start free on Squatters to practice ARV and max-offer math on real off-market properties with our deal tools. Squat it. Fund it. Own it. 🦝