How to estimate ARV (after repair value) accurately

What is ARV and why does it matter so much?

ARV is what your property will sell for after renovations. It drives every other number in your deal analysis — your MAO, your profit projection, your ROI. A $20,000 ARV overestimate on a $300,000 property can turn a $40,000 profit into a $20,000 one — or worse.

Step 1: Find comparable sales (comps)

Comps are recently sold properties similar to your subject property. Use MLS data (via an agent), Zillow, Redfin, or Realtor.com. Filter for:

• Within ½ mile (or 1 mile in rural areas)
• Same number of bedrooms and bathrooms (±1 bath is usually OK)
• Similar square footage (within 15–20%)
• Sold within the last 90 days
• Same property type (single-family, not condo or multi-family)

Step 2: Adjust for differences

No two houses are identical. Common adjustments:

• $5,000–$15,000 per bathroom difference
• $30–$80 per square foot difference
• $10,000–$30,000 for garage presence/absence
• $5,000–$20,000 for lot size differences

Step 3: Be conservative

Use the average of your comps, not the highest sale. Buyers and appraisers don't chase top-of-market comparables. Your renovated property needs to appraise at your ARV for the buyer to get financing — so price it to appraise, not to hope.

Step 4: Confirm the renovation brings you to ARV

Not all improvements add dollar-for-dollar value. Kitchen and bathroom remodels have the highest ROI. Pools, high-end finishes, and personalized features often don't pay back in resale. Compare your post-renovation property to the comps and make sure you're not over-improving for the neighborhood.