As-Is Value vs ARV: What's the Difference?
As-is value is what a property is worth today. ARV is what it is worth after the rehab. The gap between them is not your repair budget, and confusing the two is how flips lose money on paper.
As-is value is what a property is worth today in its current condition, deferred maintenance and all. ARV, or After Repair Value, is what the same property would be worth after the planned renovation is finished. The difference between the two numbers is the value the project is supposed to create, and it is almost never equal to the rehab budget.
What does as-is value mean?
As-is value is the price a willing buyer would pay for the property right now, exactly as it sits, with the dated kitchen, the roof at the end of its life, and the carpet from 1998 still in place.
Two things about as-is value that trip people up:
- •It is condition specific. Two identical floor plans on the same street can have as-is values $70,000 apart if one is renovated and one is a gut job.
- •It reflects a smaller buyer pool. Homes needing significant work often cannot be financed conventionally, which limits buyers to cash and renovation-loan borrowers. Fewer buyers means a lower price, independent of the repair cost itself.
What does ARV mean?
ARV is the projected market value once the property is restored or upgraded to the standard the neighborhood expects. It is forward looking, it assumes the scope of work is completed, and it is supported by closed sales of renovated homes rather than distressed ones.
An important limit: ARV is capped by the neighborhood, not by what you spend. Spending $90,000 in a subdivision where the top renovated sale is $340,000 does not create a $400,000 exit.
As-is value vs ARV, side by side
| As-is value | ARV | |
|---|---|---|
| Condition assumed | Current, unrepaired | Fully renovated |
| Time frame | Today | At project completion |
| Comps used | Distressed, dated, as-is sales | Renovated, updated sales |
| Buyer pool | Cash buyers, investors, renovation loans | Full retail market |
| Primary use | Purchase price, wholesale assignment, current equity | Exit price, offer formulas, refinance target |
| Who relies on it | Sellers, wholesalers, hard money lenders sizing purchase | Flippers, BRRRR investors, appraisers on 203k and rehab loans |
Is the difference between as-is and ARV just the repair cost?
No, and assuming it is will cost you money. The relationship is:
ARV = As-Is Value + Value Created by the Renovation
Value created is not the same as money spent. Three outcomes are possible:
1. Value created exceeds cost. Common when the property is distressed enough to have scared off retail buyers. The discount for condition was larger than the actual repair bill. 2. Value created equals cost. Roughly break even on the renovation itself. The deal only works if you bought below as-is value. 3. Value created is less than cost. Over-improvement. You installed finishes the neighborhood will not pay for, or you fixed things buyers do not price, like a new furnace.
The spread between as-is and ARV is where the profit lives. If that spread is thin, no amount of construction discipline saves the deal.
Worked example with illustrative numbers
A 3 bed, 2 bath, 1,500 square foot house. All figures are illustrative.
| Line item | Amount |
|---|---|
| Renovated comps support an ARV of | $310,000 |
| Estimated rehab (full cosmetic plus roof) | $58,000 |
| Value created by the renovation | $72,000 |
| Implied as-is value ($310,000 minus $72,000) | $238,000 |
| 70% rule max offer (($310,000 x 0.70) minus $58,000) | $159,000 |
As-is value tells you what the house is worth today. Your maximum offer is as-is value minus the profit and risk margin you need to justify doing the project at all. A seller with time and a listing agent can often get close to $238,000 from an owner-occupant using a renovation loan. A seller who needs to close in ten days is trading that spread for speed.
Why the distinction matters for each strategy
Flippers
You buy at a discount to as-is value and sell at ARV. If your analysis quietly sets as-is equal to ARV, every deal looks profitable and none of them are. Check the two numbers separately, every time.
Wholesalers
Your assignment fee lives inside the gap between what you contract at and what an investor will pay, which is itself a discount to as-is value. Presenting an ARV to a buyer without a supported as-is number is the fastest way to lose credibility with serious investors.
BRRRR investors
Your refinance is sized off the appraised value after repairs, so ARV is the number that determines whether you get your capital back. As-is value determines your purchase and your initial hard money or private loan sizing. Both matter, at different moments in the timeline.
Buy and hold
If you are not renovating, ARV is largely irrelevant. As-is value plus rent is your analysis.
How condition gets estimated
The single hardest input in separating as-is from ARV is condition, because condition rarely appears in structured property data. Beds, baths, and square footage are recorded fields. "Kitchen is original, subfloor is soft near the dishwasher" is not.
Practically, investors read condition from three sources:
1. Listing photos. The most information dense source available before you walk the property. Photo count, what is deliberately not photographed, flooring, cabinets, fixtures, and yard state all carry signal. 2. Listing remarks. Phrases like "handyman special," "investor opportunity," "sold as-is," and "cash or hard money only" are condition disclosures written in code. 3. The walkthrough. Nothing replaces standing in the property with a contractor.
Resideline estimates condition from listing photos and uses that estimate to drive the as-is versus ARV framing. It is an estimate, not an inspection, and it is not a substitute for a contractor bid. Comps stay visible and adjustable, so if the automated read of a property's condition looks wrong, you can change the comp set and see the value move.
Common mistakes when separating as-is from ARV
- •Using as-is comps to build ARV. If your comps are other distressed sales, you have produced an as-is value with an optimistic label on it.
- •Using renovated comps to build as-is value. The mirror error. Now your purchase target is far too high.
- •Adding rehab cost to as-is to get ARV. Backwards. Determine ARV from renovated comps independently, then work down.
- •Ignoring holding and selling costs. ARV is a gross sale price. Commissions, concessions, taxes, insurance, and loan interest come out of it.
- •Assuming the appraiser will agree. On a refinance, the appraiser sets the number, not you. Build your model with room for a value that comes in below your estimate.
Run both numbers before you offer
Start with the free ARV calculator to establish the finished value, then use the rehab cost estimator to size the work so the value created is not a guess. The deal analyzer shows as-is and ARV together with your offer ceiling and projected profit, and a CMA report gives you the comp backup to hand a seller or a lender.
Resideline freezes its estimates when a property lists and grades them against the real closing price, with results published on the public accuracy dashboard. Live valuations currently cover 31 US states.
Frequently Asked Questions
Is as-is value the same as ARV?
No. As-is value is what a buyer would pay for the property right now, with its current defects and dated finishes. ARV is what the same property would sell for after the renovation is finished. They are built from different comp sets, as-is from distressed and dated sales, ARV from renovated ones.
How do you find the as-is value of a house?
Use closed sales of comparable homes in similar condition, meaning other dated or distressed properties, not renovated ones. Adjust for size, location, bed and bath count, and condition. If the only recent sales nearby are renovated, start from ARV and subtract the value the market assigns to the missing work, which is usually more than the raw repair cost because the buyer pool shrinks.
Why is an investor's offer so much lower than the as-is value?
Because an investor's maximum offer is as-is value minus the profit and risk they need to justify the project, plus a buffer for being wrong on repairs. They are also paying for certainty: no financing contingency, no inspection repairs, no showings, and a fast close. A seller who can wait and list on the open market will usually net more.
Ready to Start Investing Smarter?
Join 2,000+ investors using Resideline.
Start free with 3 reports a month.