ARV (After Repair Value)
Quick Answer
The estimated market value of a property after all planned renovations are complete.
Definition
ARV — After Repair Value — is the estimated market value of a property once all planned renovations are completed. It is calculated by analyzing comparable recently-sold properties (comps) in the same area that are in similar finished condition. ARV is the single most important number in a fix-and-flip deal because it determines the maximum loan amount, guides the rehab budget, and sets the price target at sale.
Why It Matters for Flippers
Lenders size fix-and-flip loans as a percentage of ARV — typically 65–75% for most programs, with experienced borrowers sometimes accessing up to 90%. If your ARV estimate is too high, your loan will be undersized, or worse, the lender will decline the deal when the appraisal comes in lower. Accurate ARV protects your profit margin and your ability to finance the project.
Example in a Flip Deal
You're buying a house for $180,000 that needs $60,000 in renovations. Comparable renovated homes nearby are selling for $310,000–$325,000. Your ARV estimate is $315,000. At 75% of ARV, your maximum loan would be $236,250 — enough to cover the $180K purchase and $56K of the $60K rehab budget.
Related Terms
As-Is Value
The current market value of a property in its existing condition, before any renovations.
LTV (Loan-to-Value)
The ratio of the loan amount to the appraised value of the property, expressed as a percentage.
LTC (Loan-to-Cost)
The ratio of the total loan amount to the total project cost (purchase price + rehab budget).
Rehab Budget
The estimated total cost to complete all planned renovations on an investment property.
Fix and Flip Loan
A short-term real estate loan designed for investors who buy, renovate, and resell properties for profit.