How to Estimate ARV (After Repair Value) for a Fix-and-Flip Project By Devency Capital

When it comes to fix-and-flip investing, one number can make or break your deal: the After Repair Value (ARV). ARV is the estimated market value of a property after all repairs and renovations are completed. Calculating ARV accurately is essential—it determines how much you should pay for a property, how much to invest in renovations, and whether your deal will generate a profit. At Devency Capital, LLC, we emphasize ARV because it’s the foundation of every successful real estate investment.

What Is ARV and Why Does It Matter?

The After Repair Value (ARV) is the price a property is expected to sell for once all planned improvements are completed. Unlike the current “as-is” value, ARV looks ahead to the finished product.

Investors rely on ARV for:

• Purchase decisions – Knowing how much you can pay for a property while still leaving room for profit.

• Financing – Private and hard money lenders like Devency Capital use ARV to determine how much they can lend.

• Profitability analysis – ARV, combined with estimated repair costs, helps you calculate potential returns.

Step 1: Research Comparable Sales (Comps)

The most reliable way to estimate ARV is by analyzing comparable sales (“comps”). These are recently sold properties similar in size, style, location, and condition to your subject property—after repairs.

Tips for running comps:

• Look for sales within the last 3–6 months.

• Stay within a half-mile radius whenever possible.

• Compare properties with similar square footage, bed/bath count, and lot size.

• Only use comps that reflect a renovated or updated condition.

Real estate platforms (MLS, Redfin, Zillow) and local agents are excellent sources for comps.

Step 2: Factor in Renovation Scope

Not all renovations create equal value. For example, a full kitchen remodel or adding a bathroom will impact ARV more than painting walls.

When estimating ARV, ensure your comps reflect similar renovation quality to what you plan. If your budget doesn’t allow for a high-end remodel, don’t base your ARV on luxury properties.

Step 3: Work With the 70% Rule

A popular guideline for fix-and-flip investors is the 70% Rule:

MaximumPurchasePrice=(ARV×70Maximum Purchase Price = (ARV × 70%) – Repair CostsMaximumPurchasePrice=(ARV×70

This formula ensures you leave room for profit and financing costs. For example:

• ARV = $300,000

• Repair Costs = $50,000

• Max Offer = ($300,000 × 70%) – $50,000 = $160,000

Step 4: Consider Market Trends

ARV is never static—it depends on the market. If the market is heating up, you may sell above your projected ARV. If it’s cooling, your actual resale price may be lower.

Stay informed about:

• Local appreciation rates.

• Neighborhood demand.

• Days on market for renovated homes.

Step 5: Validate With Professional Opinions

Never rely on a single ARV calculation. Validate your estimate through:

• Real estate agents who know the neighborhood.

• Appraisers who can provide an objective value.

• Contractors who can verify repair cost estimates.

Example: ARV in Action

An investor identifies a property listed for $150,000. Renovation costs are estimated at $40,000. Comparable renovated homes in the area are selling for $280,000.

• ARV = $280,000

• Using the 70% rule: ($280,000 × 70%) – $40,000 = $156,000

• Since the property is listed at $150,000, the deal makes sense.

This framework keeps risk in check and maximizes return potential.

How Devency Capital Helps Investors

At Devency Capital, LLC, we specialize in 100% financing for qualified fix-and-flip projects, meaning you can acquire and renovate a property without using your own cash. Because our loans are based on ARV, we look at the property’s future potential, not just its current state.

Our team works with new and experienced investors nationwide to:

• Provide fast, asset-based funding.

• Help evaluate deals with accurate ARV estimates.

• Offer Joint Venture (JV) opportunities to scale portfolios.

With our expertise, investors can focus on executing projects instead of worrying about capital.

Final Thoughts

Estimating ARV accurately is one of the most important skills in real estate investing. By analyzing comps, adjusting for renovation quality, applying the 70% rule, and considering market conditions, you’ll make smarter investment decisions. And with the right funding partner—like Devency Capital—you can confidently pursue profitable fix-and-flip projects without tying up your personal savings.

Ready to scale your real estate portfolio with 100% financing? Contact Devency Capital, LLC today and let’s fund your next fix-and-flip project.

Disclaimer

The information provided in this article is for educational and informational purposes only. Devency Capital, LLC does not guarantee investment outcomes, property valuations, or financial returns. Real estate investing carries risks, including market fluctuations, unexpected repair costs, and economic factors outside of investor control. Investors should conduct their own due diligence and consult with licensed professionals—including real estate agents, contractors, appraisers, and financial advisors—before making any investment decisions.