Updated: Jul 19
When it comes to buying your first wholesale deal, you want to make sure that you’re buying at an appropriate and reasonable price.
This is why comping properties is so important, so that you know what the neighborhood is offering and selling for.
But comping is just one aspect of finding out the price for a house; there’s also figuring out the ARV.
A lot of people don’t take the ARV into account when pricing houses and that’s a huge mistake that can cost you.
There are a lot of variables that come into play when doing ARVs, which I’ll explain, but first I need to answer a very important question.
Jamil, What in the World is an ARV?
ARV stands for ‘after repair value’, and it’s the amount the house is worth once you have completely remodeled, based on the pricing in the area.
Now, ARV is determined on a number of things, including:
The property itself
Other houses in the area
ARV is one of the components to figuring out your MAO or Max Allowable Offer; this is the highest purchase amount an investor can offer on a house, while still making a profit.
I’ll save that for a later blog or video, but back to ARV.
Calculating ARV the Right Way
Calculating the ARV can be tricky because you have to include the pricing of other houses in the neighborhood, the square footage, etc.
Like I said earlier, ARV can take into account a lot of different variables, which can make it even harder to calculate.
The way I’m teaching my Astroflipping students is to just base the ARV on market specifics and don’t worry about taking out a rehab cost.
The problem with the standard MAO formula is that it’s based on things that are subjective, such as the cost of brush nickel fans, assignment fees or rehab costs.
I actually did an episode of Straight Outta Compin’, where I do some live comping and also calculate the ARV on the potential properties.
Check it out below:
A big thing you’ll notice is that I use Zillow to comp properties because they have a feature that shows property values in the same neighborhood as my property.
It’s a free service so if you aren’t using it to comp, you should be!
That’s it – calculating ARV can be tricky for beginners, but once you have the process and ignore the irrelevant stuff, you’ll be comping and doing ARVs like a pro!
If you want more comping videos, check out and subscribe to my Straight Outta Compin’ series.
We also have our Secret Agent Challenge coming up on June 8th. It’s a free 5 day event, featuring some of our biggest Astroflipping stars to help you succeed in business.
And if you’re ready to keep flippin’ flippin’, then come and join us in Astroflipping!