Beyond the Zestimate: How Smart Investors Calculate True Property Value

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The foundation of every successful house flip isn't hammers and nails—it's getting your numbers right. And no number matters more than the After-Rehab Value (ARV). This critical figure determines everything from your offer price to your renovation budget and ultimately your profit. Getting it wrong can sink your deal before you even start.

Many aspiring real estate investors struggle with accurately calculating ARV, which keeps them stuck scrolling through listings without taking action. Today, we break down three proven strategies professional flippers use to determine what a property will sell for after renovations. You'll discover why smart investors never trust a Zestimate, how to leverage your realtor's expertise without paying extra fees, and why cross-checking your numbers across multiple sources is non-negotiable.

We dive into the practical applications of PropStream for independent verification, show you how to manually pull meaningful comps on Zillow (the right way), and explain what to do when your estimates don't align. As we say, "You're not just flipping houses, you're flipping numbers, and ARV is the first number that counts." Whether you're planning your first flip or looking to refine your process on your twentieth, these real-world strategies will help you build confidence in your investment decisions and avoid costly mistakes that eat into your profits.

Ready to move beyond theories and actually apply professional-grade ARV calculation methods to your next potential deal? Subscribe to Demo to Dollars wherever you get your podcasts so you never miss our no-fluff, actionable investment strategies. Your journey from real estate dreamer to doer starts with mastering this essential skill.

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CLICK HERE to learn more about our upcoming boot camp, Flipper Camp.

Episode Transcript

Speaker 1 (00:00):
Get the ARV right and the rest of your deal has a
shot at being profitable.
Get it wrong and you're introuble.
Ever sat in your car scrollingthrough Zillow and thought, man,
if I just knew where to start Icould flip one of these.
Yeah, I've been there too.
Most people who want to fliphouses never even start, not
because they're lazy, butbecause they don't have the
blueprint.

(00:20):
Well, that changes today.
If you give me five minutes,I'll give you real-world
flipping strategies thatactually work.
No fluff, no theories, nogatekeeping, just real how-to
information for you to applytoday.
All right, let's talk about oneof the most important numbers
in your entire flipping businessthe after-rehab value, or ARV.

(00:42):
If you get this number wrongthe after rehab value, or ARV If
you get this number wrong,everything else falls apart.
You'll offer too much orunderestimate your return or
flat out lose money.
So what is ARV?
After rehab value is the priceyou reasonably expect to sell
the property for after it's beenfully renovated.
Not how it looks now, not whatyou're paying, but what a buyer

(01:03):
would pay once it's clean, safe,repaired, upgraded, shiny,
staged and market ready.
Think of it like this ARV isyour target sale price.
It's the number that drivesyour offer, your renovation
budget and, ultimately, yourprofit.
So how do you figure it out?
We use three different compingstrategies and we always

(01:24):
cross-check them against eachother.
This gives us the clearest,most accurate picture possible.
Let's break them down.
Strategy one realtor estimateFirst, and this is usually the
one we trust the most, we askour go-to realtor to pull comps
for us.
If you're flipping housesconsistently, you should have a

(01:45):
realtor you work with on everysale, someone who knows your
style, your finish levels andwhat buyers are looking for.
And these pros have access toMLS tools that give them actual
sale prices days on market priceper square foot and the finer
market trends you can't alwayssee from the outside.
They know the neighborhoods,they know what's moving and the
finer market trends you can'talways see from the outside.
They know the neighborhoods,they know what's moving and they

(02:08):
can give you a price estimatethat's grounded in reality.
Pro tip if you're doing volumeand sending them repeat business
, most agents will run comps foryou without charging a fee Just
ask.
Strategy two in-house tools weuse PropStream.
We also like to double-checkcomps ourselves using PropStream
, a powerful tool that lets youpull recent sales, public

(02:29):
records, mls data and eveninvestor-specific filters.
You can look at properties soldin the past six to 12 months,
drill down by beds, baths,square footage and renovation
quality and get a solid ballparkof what fully renovated homes
are selling for in that market.
It's fast, it's consistent andit keeps you from being totally

(02:51):
dependent on someone else'sanalysis.
Strategy three Zillow, but skipthe Zestimate.
Now I know what you're thinkingZillow, really, yep, but here's
the key we never use theZestimate, never.
The Zestimate is based on analgorithm and it's usually way
off, especially if the propertyis distressed or the
neighborhood has any quirks.

(03:12):
Instead, we use Zillow tomanually pull sales.
Go to the map, filter by soldlistings, match up similar homes
by square footage, bed bathcount, lot size, location, same
neighborhood or within one totwo miles max.
Then scan the photos.
If your finished product willlook like the one that sold for
$460,000 and the market hasn'tchanged much, since you can feel

(03:35):
reasonably confident, that's agood comp.
So what number do you use?
Once we've gathered all threecomps from the Realtor
PropStream and Zillow we comparethem.
If they're close, great, we'veprobably got an accurate ARV.
If they're all over the place,look deeper.
Did one comp include a finishedbasement.
Was one a flip and the othersweren't?

(03:55):
When it's time to choose thenumber, we usually go with the
Realtor's estimate, as long asit's supported by the data.
Good agents are experts intheir local markets and they're
the ones actually selling theproduct you're about to create.
Final takeaway Get the ARVright and the rest of your deal
has a shot at being profitable.
Get it wrong and you're introuble.
Use multiple sources, don'trely on just one and don't be

(04:20):
lazy.
Dig into the photos, thelayouts and the neighborhoods.
You're not just flipping houses, you're flipping numbers, and
ARV is the first number thatcounts A lot.
Now get out there and makesomething happen.
Thanks for listening to Demo toDollars.
If today's episode helped youmove one step closer to your
first or next deal, do me afavor Follow us wherever you get

(04:43):
your podcasts so you never missa show.
I'm grateful to be part of yourjourney.
Now get out there and getcracking.
Bye for now.