What Is ARV (After Repair Value) in Real Estate? (Investor Guide 2025)

If you're investing in real estate, one of the most important numbers you need to understand is ARV—After Repair Value.

In this guide, we'll break down what ARV means and how investors in Colorado use it to evaluate deals.

What Is ARV?

ARV stands for After Repair Value, the estimated value of a property after renovations are completed.

Why ARV Matters

ARV helps investors determine:

Whether a deal is profitable
How much to spend on renovations
What price to buy at

Example

Purchase Price: $200,000
Rehab Cost: $40,000
ARV: $320,000

Potential equity: $80,000

How Investors Use ARV

Investors often use rules like:

Buy at 70% of ARV

This leaves room for rehab costs, holding costs, and a profit margin.

ARV and Financing

ARV is especially important for:

BRRRR strategy
DSCR refinancing
Fix-and-flip deals

Lenders use post-rehab appraisals to confirm value. ARV also drives LTV on a refinance — see our DSCR loans guide, our fix & flip loans guide, and our DSCR vs. fix & flip comparison for how this works on investment properties.

Final Thoughts

Understanding ARV is essential for any real estate investor. It helps you make smarter decisions and avoid overpaying for properties.

See ARV in action in our BRRRR and no-seasoning DSCR case studies.

Frequently asked questions

How is ARV calculated?

ARV is estimated by pulling 3–5 recently sold comparable properties in similar condition to the post-rehab subject property, then averaging their price per square foot.