Finding the ARV of a property

[Cornelius Moye]

Is there a formula for finding the arv of a property

[Jon Holdman]

@Christina Hoffmeier give you the basics of it.  This is perhaps the most difficult part of fix and flipping.  You must be very careful in finding comps.   If you ask an agent to do an analysis they will typically find three or four recent sales and three or four current listings.  An appraiser will do the same.  Problem is, you don't know which ones an appraiser will choose.  So, as an investor, you need to look at ALL possible comps.  And you want to be conservative in your choice of comps.  Appraisers often are.

Comps also have to be as similar as possible to the subject (the property you're considering buying.)  Same style, close to the same size, same condition, same positives and negatives.  Often something that looks like a good deal turns out to have some big, un-fixable negative - busy road, train tracks, etc.  When that's the case, "comps" are only properties with the same big negative.