ARV is what your property will be worth after renovations are complete — not what it's worth today, and not what you hope it'll be worth. Every other number in your deal flows from this one: your maximum offer, your rehab budget ceiling, your loan-to-cost, and your profit margin.

Get your ARV wrong, and everything downstream is wrong with it.

The standard approach is to pull 3–5 recently sold comparable properties — not active listings, not what your agent thinks the market "might do." You're looking for:



• Similar square footage and bed/bath count
• Same neighborhood or a truly comparable one
• Similar finish level to what you're planning
• Sales within the last 3–6 months

Average the adjusted comps, and you have a defensible ARV.

Once you have an ARV, hard money lenders (RHM included) use it to calculate your Maximum Allowable Offer (MAO):

ARV × 70% – Repair Costs = MAO

Example: A property with a $300,000 ARV and a $65,000 repair budget gives you a maximum allowable offer of $145,000 ($300,000 × 0.70 = $210,000, minus $65,000 in repairs). Run your own numbers with our free Hard Money Loan Calculator.

That 30% buffer isn't arbitrary — it protects your margin against the unexpected: a longer hold, a softening market, or a repair budget that runs over.

A lot of ARV guidance online is written for national audiences, and it shows. Milwaukee and the broader Wisconsin market has its own rhythm — certain neighborhoods where buyers reward a full rehab, others where over-improving just adds cost without adding resale value. Comps in Waukesha County behave differently than comps in Milwaukee's central city, and a national average tells you nothing about either.

This is where local lending experience earns its keep: understanding not just what sold, but why it sold at that price.

We don't let borrowers guess and we don't rely on borrower estimates alone. Every deal we fund goes through a third-party ARV assessment — an unbiased evaluation that protects the borrower, the investor, and the deal itself. It's an extra step, but it's the difference between a number you hope is right and a number you can build a business on.

Overestimating. It's almost always overestimating. Pulling comps from list prices instead of sold prices, assuming a "hot market" premium that isn't reflected in actual closings, or letting excitement about a property inflate the number. If your deal only works at an optimistic ARV, it doesn't work. Learn more about the 7 Mistakes First-Time Flippers Make.

A conservative, well-supported ARV doesn't just protect your deal, it makes you look more prepared to lenders, sellers, and agents alike. Before you submit your next offer, run it through our loan calculator to see where you stand. And if you want a second set of eyes on the numbers, get pre-approved and let's talk it through.