How to Calculate ARV (After Repair Value) From Comps

ARV (after repair value) is what a house should sell for once the renovation is done. You calculate it from comps — comparable sales: take 3–5 similar houses nearby that sold recently already renovated, divide each sale price by its square footage, and multiply the lowest, median and highest price per square foot by your own square footage. That gives a conservative, base and aggressive ARV.

What is ARV and why it drives every other number

Every figure in a flip hangs off ARV. The 70% rule maximum offer is ARV × 70% − repairs. Selling costs are a share of ARV. The target profit is usually a share of ARV. A hard money lender sizes the loan off it. If the ARV is $20,000 too high, the offer is too high by nearly as much, and the mistake is locked in on the day you close — long before you find out.

That is why ARV deserves more care than any other input, and why one precise-looking number is the wrong format for it. A sale price is a fact. An ARV is a forecast of a sale that has not happened, and a forecast should come with a range.

How do you calculate ARV from comps?

The method is price per square foot. Houses in the same neighborhood, of the same type and condition, tend to sell within a narrow band of dollars per square foot; your renovated house should land inside that band.

Price per sq ft (each comp) = Sale price ÷ Square feet
Conservative ARV = Lowest $/sq ft × Your sq ft
Base ARV        = Median $/sq ft × Your sq ft
Aggressive ARV  = Highest $/sq ft × Your sq ft

Picking the comps is where the accuracy lives. The guidance Flip Investor OS shows next to the comp list:

1. Sold in the last 6 months. Older sales reflect an older market. Pending listings and active listings are not sales — sellers ask more than they get.
2. Within about half a mile and in the same neighborhood. Do not cross a major road, a school boundary or a change in housing stock.
3. Similar size, within about 20% of your square footage, and the same bed and bath count where possible.
4. Already renovated to the level you plan. You are estimating the value after repair, so a dated house that sold as-is tells you nothing about it.
5. Same property type, similar age and lot. Skip outliers you cannot explain.

Three comps is the minimum; five is better, because one odd sale moves the median less. Reaching for a sixth usually means reaching further away or further back, which makes the set worse.

Worked example: five comps on a 1,600 sq ft house

The example house used across this site is 1,600 sq ft, 3 bed 2 bath, built in 1978. Suppose these five renovated houses sold nearby in the last six months (an example, not market data):

Sort the price per square foot: $196.05, $198.08, $200.00, $201.18, $203.03. The lowest is $196.05, the median (the middle of five) is $200.00, the highest is $203.03. Multiply each by 1,600 sq ft:

With four comps the median is the average of the two middle values. Rounding to the nearest $1,000 is deliberate: $313,684 looks like a measurement, and it is not.

This is the arithmetic of the free ARV from comps calculator in Flip Investor OS: your square footage and 3–5 sold comps in, conservative / base / aggressive out. Inside a property, the same comps are saved with it and the range feeds the deal analysis and the pages you share with a lender or partner. You can open the free calculator with your own comps.

Conservative, base and aggressive: why a range instead of one number

The spread between the lowest and highest comp is information, not noise. In the example it is $11,000 on a $320,000 house — about 3.4% — which says the neighborhood is consistent and the ARV is well supported. A spread of $40,000 on the same house would say the opposite: either the comps are not really comparable, or the street has a wide range of finishes and buyers, and your ARV depends on which end you land on.

Use the three numbers for three different jobs:

• Base for planning: the budget, the timeline, the listing price you expect.
• Conservative for the margin: if the deal only works at the base ARV, it does not work.
• Aggressive as a ceiling: what the best outcome looks like, and a warning when your own expectation drifts above it.

A single "ARV = $320,000" hides all of that. Three numbers show you how much of your profit is sitting on the assumption.

How to adjust comps

Price per square foot handles size. It does not handle everything else, and small adjustments keep a comp honest:

• Beds and baths. A third bath or a fourth bedroom in the same square footage usually adds value; one fewer takes it away. Adjust the comp's price towards your house's layout, not the other way round.
• Garage, lot, pool. A two-car garage against a carport, a double lot, a pool in a hot climate: real buyers pay for these, so the comp's price should move before you divide by square footage.
• Finish level. If a comp was renovated to a higher standard than you plan — custom cabinets, hardwood throughout — it belongs at the aggressive end, not the base.
• Time. A sale from five months ago in a rising market is slightly low; in a falling market slightly high. Do not invent a percentage; note the direction and lean the comp to the matching edge of the range.
• Concessions. A sale with a large seller credit closed lower in substance than the recorded price. If you can see the credit, subtract it.

How large each adjustment is varies by market, and no table in an article can tell you. What you can do is keep the adjustment and the reason written next to the comp, so the number can be checked by someone else — a partner, a lender, or you in six months.

What a bad comp looks like

Most ARV mistakes are not arithmetic. They are comps that should not have been in the list:

• An active or pending listing. The seller's hope, not a price. Sales only.
• A sale across the main road. Half a mile on the map can be two different markets.
• A different house type. A townhouse for a detached house, a two-storey for a ranch, a new build for a 1978 house.
• An as-is sale — a house that sold unrenovated, often to another investor. That is the price you are trying to pay, not the price you are trying to get.
• A much smaller house. Small houses sell for more per square foot; a 1,100 sq ft comp inflates a 1,600 sq ft ARV.
• An outlier you cannot explain. One sale $30 per sq ft above the rest, with no visible reason, is more likely a special buyer than a signal. Leave it out or let it be the aggressive edge, never the base.
• A sale from a year ago. If the market moved, the comp did not move with it.

The quickest test: would you be comfortable showing this list to the appraiser who values the finished house for the buyer's lender? If a comp would embarrass you there, it is not supporting your ARV either.

Running the deal at all three ARVs

A range is only useful if the deal is calculated at every point in it. Flip Investor OS runs the deal analysis at the conservative, base and aggressive ARV side by side. With the example house's other numbers — bought for $200,000 cash, $48,000 of repairs plus 10% contingency, 2% purchase closing costs, $1,500 a month of holding for 6 months, 6% selling costs — the three readings are:

Check one line: 314,000 − 18,840 − 265,800 = 29,360. The base case clears the app's default target of 10% of ARV; the conservative case just misses it. That is the honest picture of this deal: fine at the median comp, thin at the lowest one — a margin of safety of about $6,000 against the ARV being wrong. Whether that is enough is your call; the point of the range is that you make it knowing. The flip profit article adds the stress tests on top: ARV −5%, rehab +20%, three more months.

From ARV to the offer

Once the range is set, the ARV's job is to feed the offer, and the offer should be built from the conservative or base figure, never the aggressive one. A maximum offer built on the best comp is a bet that your house will be the best sale on the street — which happens, but should not be the plan.

Three habits protect the number:

1. Save the comps with the deal, with the adjustments written down. An ARV with no visible evidence cannot be checked and drifts upwards with optimism.
2. Re-run the comps before closing. Two months after the first analysis there may be new sales — and the new ones count more than the old ones.
3. Watch for inverted order. If your conservative ARV ends up higher than your aggressive one after manual edits, something is wrong with the inputs; the app flags that, and it is worth a look before any number goes further.

Many of the ways flips lose money start here, with an ARV that was really a hope. A range from real sales, kept next to the deal, is the cheapest insurance a flipper can buy.