After-Repair Value (ARV)
After-repair value (ARV) is the estimated market value of a property after all planned renovations are complete. Investors use ARV to decide what to pay for a fixer-upper and to project profit on a flip or BRRRR deal.
ARV is estimated by running comparable sales (comps): recently sold, fully renovated properties of similar size, age, and location. Because every downstream number (maximum offer, rehab budget, refinance proceeds, expected profit) is calculated off ARV, an inflated estimate is the single most common way new investors lose money on a flip.
Lenders also underwrite against ARV: hard-money and renovation loans are typically capped at a percentage of ARV (often 70–75%), which is why the 70% rule uses it as the anchor.
Worked example
A Garland house needs $45,000 of work. Renovated comps on nearby streets sell for about $290,000–$300,000, so the investor sets ARV conservatively at $290,000. Using the 70% rule: maximum offer = (70% × $290,000) − $45,000 = $158,000.
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