What is the 70% rule?

A flipping screen: pay no more than 70% of the after-repair value minus the repair cost. On a $265,400 ARV with $35,000 of repairs, that is about $150,800.

ARV Calculator

Free ARV calculator. Estimate after-repair value from comparable sales and see the most you can offer under the 70% rule for a fix and flip or BRRRR.

ARV = Average comp price per sq ft × Subject sq ft · Max offer = ARV × 70% − Repairs

Estimated ARV

—

Average comp price per sq ft	—
Max offer at your rule	—
Rule margin (ARV − max offer − repairs)	—

Planning estimate. Use recent, nearby sales of similar renovated homes, and confirm value with an agent or appraiser.

How to calculate ARV

After repair value (ARV) is what the property should sell for once the renovation is done. The common way to estimate it is from recent sales of similar, renovated homes nearby: average their price per square foot and multiply by your property's square footage.

Example: three renovated comps sold at about $180, $176 and $175 per square foot, an average near $177. For a 1,500 square foot house that points to an ARV of roughly $265,400.

The 70% rule

The 70% rule is a flipping screen: pay no more than 70% of ARV minus the repair cost. On a $265,400 ARV with $35,000 of repairs, the maximum offer is about $150,800. The remaining 30% of ARV has to cover selling costs, holding costs, financing and your profit.

In competitive markets many investors use 75% or 80% and accept a thinner margin. Change the rule percentage in the calculator to see the offer at each level.

Getting the comps right

Use sales from the last three to six months, within a short distance, with similar size, bedrooms, bathrooms and finish level. Price per square foot can mislead when the comps differ a lot in size or condition, so adjust for those differences or ask an agent for a broker price opinion before you commit.

ARV FAQ

What does ARV mean in real estate?

After repair value: the estimated market value of a property once planned renovations are complete.

Do lenders use ARV?

Fix-and-flip and rehab lenders often size loans on ARV, and a BRRRR refinance depends on the appraisal coming in near your ARV. Lenders order their own appraisal, so treat your ARV as an estimate until then.

Is the 70% rule still realistic?

In many markets few deals meet it. It works best as a quick filter, followed by full numbers on holding time, financing and selling costs.

BRRRR calculator to test a refinance on the same ARV
Rental property calculator if you plan to hold
ZIP data for prices and days on market near the property

Analyze an exact address in Dynamic.re

The calculator works from the assumptions you type in. When you are ready to move from a set of assumptions to a specific property, open Dynamic.re and analyze the exact address.

Analyze this address in Dynamic.re