What Is After Repair Value (ARV)?
Also known as: ARV
After Repair Value (ARV) is the estimated market value a property will be worth once it has been fully repaired and renovated. It is the anchor number wholesalers and investors use to back into a maximum offer.
After Repair Value (ARV) is the estimated market value a property will be worth once it has been fully repaired and renovated. It is the anchor number wholesalers and investors use to back into a maximum offer.
After Repair Value (ARV) explained
ARV is the foundation of almost every wholesale deal. Before you can decide what to offer a seller, you need a defensible estimate of what the finished, renovated home would sell for on the open market. That number is the ARV.
Wholesalers establish ARV by pulling recent comparable sales (comps): similar homes in the same area, ideally sold in the last 90 to 180 days, with similar square footage, bed/bath count, and condition. You average the price per square foot of the best comps and apply it to the subject property in its renovated state. A reliable ARV protects both you and your cash buyer, because the entire deal is priced as a percentage of it.
Offer math: ARV × 0.70 − Repairs − Your Fee = Max OfferExample
A 1,400 sq ft house needs a full rehab. Three renovated comps nearby sold around $200 per sq ft, so the ARV is roughly 1,400 × $200 = $280,000. With $40,000 in repairs and a $10,000 wholesale fee, a 70% rule offer would be 280,000 × 0.70 − 40,000 − 10,000 = $146,000.
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