Take your adjusted comp values and calculate the After Repair Value - what the property will sell for once fully renovated.
Add all adjusted comp values, divide by number of comps
($205K + $212K + $198K) ÷ 3 = $205,000 ARV
Give more weight to comps most similar to your subject
Best comp counts 50%, others 25% each
Use the lower-middle value from your adjusted comps
If comps are $198K, $205K, $212K → Use $200K-$205K
| Comp | Sold Price | Adjustments | Adjusted Value |
|---|---|---|---|
| Comp 1 | $240,000 | -$34,500 | $205,500 |
| Comp 2 | $225,000 | -$12,000 | $213,000 |
| Comp 3 | $218,000 | +$8,000 | $226,000 |
Average: ($205,500 + $213,000 + $226,000) ÷ 3 = $214,833
Conservative ARV: $210,000 - $215,000
When in doubt, round DOWN. It's better to underestimate ARV and get a great deal than overestimate and lose money. A $5K-$10K buffer can save a deal.
Take your adjusted comp values and determine the After Repair Value - what your property will be worth when fully renovated.
After Repair Value (ARV) = What the property will sell for AFTER all repairs and renovations are completed
Add all adjusted comp values and divide by number of comps
Best for: Similar comps with tight value range
Give more weight to the most similar comps (closest in size, location, date)
Best for: Mixed quality comps
Use the lower end of your comp range (throw out the highest)
Best for: Uncertain markets or first-time compers
| Comp | Sold Price | Adjusted Value |
|---|---|---|
| Comp 1 | $280,000 | $265,000 |
| Comp 2 | $255,000 | $260,000 |
| Comp 3 | $245,000 | $255,000 |
Average: ($265K + $260K + $255K) ÷ 3 = $260,000 ARV
Conservative: Use $255K if uncertain
When in doubt, be conservative. It's better to underestimate ARV by $10K and make a safe deal than overestimate by $10K and lose money.