About the ARV Calculator
After repair value, or ARV, is what a property should be worth once it has been renovated. It is the foundation of every fix-and-flip and many buy-and-hold investments: lenders use it to set loan amounts, investors use it to decide how much to pay, and the difference between ARV and total costs is the profit. Estimate it too high and a deal that looks profitable loses money.
This ARV calculator estimates after repair value from up to three comparable sales, called comps: recently sold homes that are similar to yours after renovation. It works out each comp's price per square foot, averages them and applies the average to your property's living area. It shows the range from the lowest to the highest comp, and works out a maximum offer using the popular 70% rule.
How to Use the ARV Calculator
Enter the subject living area in square feet.
Enter the sale price and living area for up to three comps.
Enter the repair budget and the rule percentage.
The Formulas
price per ft² = comp sale price ÷ comp living area
average = mean of the comps' price per ft²
ARV = average × subject living area
maximum offer = ARV × rule % − repairsStep-by-Step Example
A 1,500 ft² house, three comps, 40,000 of repairs, the 70% rule.
comp 1 300,000 ÷ 1,450 = 206.90 per ft²
comp 2 315,000 ÷ 1,550 = 203.23 per ft²
comp 3 290,000 ÷ 1,400 = 207.14 per ft²
average 205.76 per ft²
ARV 205.76 × 1,500 = 308,633
range 304,839 to 310,714
max offer 308,633 × 70% − 40,000 = 176,043Choosing Good Comps
The quality of the comps decides the quality of the estimate. Good comps sold recently, ideally within the last three to six months, and close by, often within half a mile to a mile and in the same neighbourhood or school district. They should be similar in size, age, style, bedrooms and bathrooms, lot size and garage, and crucially in condition: for ARV, use homes renovated to the standard you plan, not dated ones. Agents can pull sales from the local listing service, and public records show sale prices in many areas.
Price per Square Foot and Its Limits
Price per square foot is a simple way to compare homes of different sizes, but it does not capture everything. A comp with a pool, a bigger lot, a better view or an extra bathroom may sell for more per square foot for reasons that do not apply to your property. Appraisers make dollar adjustments for each difference. Use the range between the lowest and highest comps as a reality check, and lean towards the lower end when in doubt.
The 70% Rule
The 70% rule is a quick screen used by flippers: the purchase price should be no more than 70% of the ARV, minus the cost of repairs. The remaining 30% of ARV is meant to cover buying and selling costs, holding costs, financing and profit. It works reasonably for mid-priced homes, but is only a starting point. In high-priced markets 75 to 80% may still leave a good profit; for big renovations or slow markets, investors often use 65%. Run the full numbers in the house flipping calculator before making an offer.
ARV for Lenders
Hard money and renovation lenders often lend a percentage of ARV, commonly 65 to 75%, rather than of the purchase price. A realistic ARV therefore affects how much you can borrow. Lenders usually order their own appraisal, so an inflated estimate will not survive their review.
Adjusting Comps by Hand
If one comp has an obvious difference, such as an extra bathroom or a garage your property lacks, you can adjust its price before entering it. Subtract the typical value of the feature from the comp's price, so the comparison is like for like. Local agents and appraisers know what features add in your market; a full bathroom or a two-car garage can each be worth tens of thousands of dollars in some areas.
Market Changes
ARV is a forecast of what the property will sell for when the renovation is finished, often months away. In a rising market, recent comps may understate the eventual price; in a falling one they may overstate it. Look at how long similar homes are taking to sell and whether prices have been cut, and be conservative if the market is cooling.
Renovation Scope
The ARV assumes the renovation matches the comps. Over-improving, with finishes better than the neighbourhood supports, rarely raises the sale price enough to pay for itself. Under-improving leaves the house worth less than the comps. Match the scope of work to the homes you used as comps.
A Quick Sense Check
Compare the ARV with the median sale price for the area. A figure far above it suggests the comps are too generous.
Understanding Your Result
The headline gives the after repair value.
The comparable sales line gives the average price per square foot and each comp's figure.
The range line shows the value using the lowest and highest comps.
The maximum offer line applies your rule percentage.
When Should You Use This Calculator?
Use it to screen properties before making offers.
Use it to check a seller's or wholesaler's claimed ARV.
Use it to prepare for conversations with lenders.
Common Mistakes
Using unrenovated comps. ARV needs renovated sales.
Choosing distant or old sales. Recent, nearby comps are best.
Trusting the highest comp. Use the average and the range.
Treating the 70% rule as gospel. Check the full profit.