New Investor Needs Help with Analyzing Process!!!
New to Real Estate · Paducah, KY · Member since 2026 · 13 posts · 8 votes
New Investor Needs Help with Analyzing Process!!!
7 Replies
- 1wVaibhav PuranikPro MemberMember since 2025 · 43 posts · 16 votes
Have you thought of using AI for estimating ARV? The newer models like ChatGPT Astra can research various records in your county and give you a fairly good idea about what ARVs can be achieved. Even if your market is small, it's possible to look at the sell data with the amenities and conclude rough estimates. I am not saying this in void, I did it for some one else in some other market and I was surprised with the results. Here are the older results for the different market - https://drive.google.com/file/d/1QHiS08RQ8TeKo34KgQ4IifXJ_haqoOy6/view?usp=sharing
- Investor · Northborough, MA · Member since 2017 · 12 posts · 3 votes1w
I think your best bet is to get to local real estate meetups, find the veterans, ask them how they do specific things. If you went to 3 meetups per month, and at each meetup you asked 3 investors how to analyze 3 trades/aspects, you'd have insight into many things you'd need to know within 90 days.
- 1wDivin KanyamaBusiness MemberAccountant · Seattle, WA · Member since 2025 · 149 posts · 39 votes
You’re definitely not alone, @Kayden Wahl. Estimating ARV is one of the hardest parts of analyzing a deal, especially in a smaller market.
Start with the best three to five sold comps that match the property’s location, size, layout, and renovated condition. If inventory is limited, widen the area or go farther back in time—but avoid stretching both at once. Don’t just average the prices; adjust for differences such as garages, finished basements, lot quality, and renovation level.
Use an ARV range—conservative, likely, and best case—and analyze the deal using the conservative number. Then have a local agent, appraiser, or experienced investor double-check your assumptions. If the deal only works at the best-case value, be cautious.
Keep practicing and compare your estimates with actual sale prices—that feedback will sharpen your judgment quickly.
- 1wJames WachobBusiness MemberReal Estate Broker · Memphis, TN · Member since 2015 · 1k+ posts · 887 votes
Hey @Kayden Wahl ! Getting comfortable with ARV is definitely one of the harder parts when you're starting out, especially in a smaller market where good comps can be limited. I'd focus on finding the most similar properties possible based on location, size, condition, bed/bath count, and renovation level rather than trying to find an exact match.
When comps are limited, I’d also look at recent sales farther out from the immediate area and make conservative adjustments instead of relying on the highest sale price. Talking with a few local agents who regularly work with investors can also give you a better feel for what renovated properties are actually selling for.
I’m a real estate agent based in Memphis, TN, and I work with out-of-state investors building rental portfolios. If you ever want to compare how we approach comps and underwriting in Memphis, I’d be happy to connect and help.
- 1wGregory AcsPro MemberLender · MD · Member since 2025 · 133 posts · 52 votes
That's a common challenge, especially in smaller markets where there aren't many recent comparable sales. When I can't find perfect comps, I'll widen the search slightly, adjust for differences in size, condition, and location, and focus on properties that would realistically compete with mine after the renovation. I'd rather be conservative with my ARV than build a deal around an optimistic number.
I also like to analyze the financing using a conservative ARV instead of the best-case scenario. If the deal still works with a lower appraisal, you're in a much stronger position. If you'd like to walk through a deal or compare financing scenarios based on your projected ARV, I'd be happy to help.
- 1wJordan RayBusiness MemberReal Estate Agent · Memphis, TN · Member since 2023 · 623 posts · 321 votes
Welcome to BiggerPockets! Getting really good at analyzing deals is exactly what you should be practicing before you start putting serious money into properties, and ARV is definitely one of the harder pieces when you're learning, especially in a smaller market with limited comps. I wouldn't force an ARV just because you need a number to make the deal work. Start with the closest recently sold properties that are genuinely comparable in location, square footage, bed/bath count, construction, condition, and overall quality of renovation, then work outward carefully if you don't have enough data. If the comps are weak, I'd actually underwrite the ARV conservatively and leave yourself a larger margin for error. This is also where having a strong investor-friendly agent who understands investment property and actually knows how to build a CMA can be extremely valuable. It's perfectly fine to research several markets while you're learning, and once you find one that aligns with your investment goals, hone in on it and become an expert at the neighborhoods, ARVs, rents, rehab costs, and market trends before expanding elsewhere. I'm an investor and agent in Memphis, and I work with a lot of investors doing exactly this because Memphis still has opportunities where you can meet or exceed the 1% rule, force equity through renovations, and benefit from appreciation when you buy in the right locations. For BRRRR deals, we also have local hard money lenders offering 100% financing on the purchase and 100% of the rehab, with many investors getting into deals with around $10,000 out of pocket before refinancing into long-term financing. Most importantly, start building your boots-on-the-ground team now—an investor-friendly agent who also owns rentals, a strong property manager, a reliable general contractor, and good hard money and DSCR lending contacts. Analyze enough properties and eventually you'll start recognizing a realistic ARV almost immediately, but until then, stay conservative and never make the comps tell you what you want to hear. Feel free to reach out, talk soon!
Jordan Ray - eXp Realty5110 Reviews - Englewood, NJ · Member since 2018 · 356 posts · 60 votes4d
Kayden, the ARV problem in small markets is real, and honestly most of the advice here is solid. Let me add something that might help you think about it differently.
I invest in Broward County tax deed auctions. The ARV challenge there is even worse than what you are describing, because you often cannot even walk through the property before you buy it. You are estimating value blind. So I had to develop a system that works even when the data is thin.
Here is what I do. I call it the subtraction method. Instead of trying to predict what your property will be worth after rehab, find three to five properties that ALREADY sold in renovated condition within a mile of your target. Then subtract what a typical rehab costs in your area. If a fully flipped house sold for $320K and a full rehab runs $40K in your market, the as-is value with renovation potential is around $280K. You are letting the market tell you the answer instead of guessing.
The other thing that helped me is understanding the price ceiling in each neighborhood. Every area has a price point where homes stop moving. In my market, I have seen investors put $60K into a renovation only to discover the neighborhood caps out $20K below what they spent. The comp data looked good on paper, but the ceiling was lower. In a small market like Paducah, this matters even more because there are fewer buyers willing to pay top dollar.
One more thing. Do not just talk to agents. Talk to contractors. They know what renovations actually cost in your area, and they know which improvements buyers care about. A new roof and HVAC move the needle. A fancy kitchen in a C-class neighborhood does not recover its cost.
What kind of properties are you looking at right now? Single family, multifamily, or something else?
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