Every wholesale deal starts with one number: the after repair value, or ARV. It is the price the property will sell for once it is fully renovated and back on the market in good condition. Every other figure in your offer, the repair budget, the maximum allowable offer, your assignment fee, is derived from it.
Get the ARV right and you can make an offer with confidence. Get it wrong and you either tie up a deal your buyer walks away from, or you lose a good deal to a wholesaler who ran the math correctly. This guide walks through exactly how experienced wholesalers calculate ARV, and how to do it accurately without ever setting foot on the property.
What ARV Actually Means
ARV is not the current value of the property. It is not the Zillow estimate, and it is not what the seller thinks the house is worth. ARV is the realistic resale price after a full renovation brings the property up to the standard of comparable, updated homes in the same neighborhood.
Think of it as answering a single question: if this house were fixed up to match the nicest recently sold homes on the street, what would a retail buyer pay for it? That number is the foundation of your entire deal.
ARV is a forward-looking number. You are valuing the house as it will be after repairs, not as it sits today. Never confuse the as-is value with the ARV, they can be tens of thousands of dollars apart.
The Comp-Based Method, Step by Step
ARV is calculated from comparable sales, known as comps. These are recently sold homes similar to your subject property in size, condition, and location. The process is straightforward once you know what to look for.
- Pull recently sold comps. Look for homes that have sold in the last 3 to 6 months. Sold prices matter, not active listings. Active listings tell you what sellers hope to get; sold prices tell you what buyers actually paid.
- Match on proximity. Stay within half a mile when possible, and never cross a major boundary like a highway, school district line, or a clear shift in neighborhood quality. Values can change dramatically two streets over.
- Match on size and layout. Compare homes within roughly 20 percent of your subject's square footage, and match bedroom and bathroom counts as closely as you can. A 3-bed, 2-bath does not compare cleanly to a 2-bed, 1-bath.
- Match on condition. Your comps should be renovated or move-in ready homes, because that is the condition your subject will be in after repairs. Comps that sold in distressed condition understate your ARV.
- Calculate price per square foot. Take each comp's sold price and divide by its square footage. This normalizes for size differences and gives you a per-foot value to apply to your subject.
- Apply it to your subject. Average the price per square foot of your best comps, then multiply by your subject's square footage. That is your baseline ARV.
For example, if three strong renovated comps sold at an average of $180 per square foot, and your subject is 1,500 square feet, your baseline ARV is roughly $270,000.
What Makes a Comp Strong or Weak
Not all comps are created equal. The quality of your ARV depends entirely on the quality of your comps. Here is how to weight them.
Strong comps
- Sold within the last 90 days
- Within half a mile, same neighborhood, same school zone
- Similar square footage, same bed and bath count
- Renovated or move-in condition
- Arm's length sale, not a foreclosure or family transfer
Weak comps to avoid leaning on
- Sales older than 6 months in a moving market
- Homes across a major road or in a different subdivision
- Distressed or as-is sales that were not renovated
- Wildly different square footage or layout
- Off-market or non-arm's length transactions
Adjusting for Condition and Features
No two homes are identical, so you adjust. If a comp has a feature your subject lacks, subtract value. If your subject has something the comp does not, add value. Common adjustments include an extra bathroom, a finished basement, a garage, a larger lot, or a recent major system replacement.
The goal is not surgical precision on every line item. It is to make sure you are comparing like with like, so your final ARV reflects what a retail buyer would realistically pay for your specific property once it is renovated.
Why Property Condition Data Matters for ARV
Here is where virtual wholesalers get into trouble. You can pull perfect comps and still blow the deal if you do not know the true condition of the subject property. ARV assumes a full renovation, but the size of that renovation, and therefore your repair budget, depends entirely on what the house needs.
A property that needs a light cosmetic refresh and one that needs a new roof, HVAC, and full gut are both worth the same ARV once finished. The difference is the repair cost, which comes straight out of your offer. That is why accurate condition data matters as much as good comps.
This is exactly the gap seller-submitted photos close. Instead of guessing at condition or waiting days for a boots-on-the-ground visit, you send the seller a simple photo link and get organized, room-by-room images the same day. With comps giving you the ARV and photos giving you the repair scope, you can make a confident offer on a house you have never seen.
ARV without accurate condition data is only half the equation. The final offer is ARV minus repairs minus your margin. Nail both sides and your offers hold up all the way to closing.
Putting It All Together
Once you have your ARV, the rest of the deal follows a standard formula. Most wholesalers use the 70 percent rule as a starting point: maximum allowable offer equals ARV times 0.70, minus estimated repairs, minus your assignment fee. The ARV is the anchor that makes every downstream number reliable.
Run your comps carefully, get real condition data on the subject, and your ARV will be something you can stand behind when a cash buyer scrutinizes the deal. That confidence is what separates wholesalers who close consistently from those who chase deals that fall apart at the finish line.