What is after repair value and how does it affect your offer?

What can you do if you think the ARV estimate is wrong?

ARV is an estimate, and reasonable people can disagree on the details. If the figure a buyer gives you seems out of step with what you know about your local market, ask for the evidence behind it.

A reputable buyer should be able to show you the specific comparable sales they used: addresses, sale prices, dates, and condition at the point of sale. Check that the comparables are genuinely similar – same property type, similar size, a realistic distance from your property, and sold within the last 6–12 months where possible.

If the comparables don’t hold up, or the buyer can’t produce them at all, that is a legitimate reason to question the offer. This is also where NAPB membership matters: members are required to be transparent about how an offer was reached, which includes the ARV assumptions behind it.

Does ARV mean a property in poor condition always gets a low offer?

Not necessarily. A larger refurbishment gap reduces the percentage of market value you receive, but it doesn’t mean the offer itself is unfair – it reflects the genuine cost of bringing the property up to a sellable standard. In fact, properties needing significant work are often exactly the properties where a cash sale makes the most sense, because they are harder to sell through a traditional estate agency route in the first place. Mortgage lenders are often reluctant to lend on a property in poor condition, which narrows the pool of traditional buyers considerably.

A cash buyer doesn’t face that restriction. They can purchase a property in any condition, calculate the offer based on ARV, and move forward without needing the property to be mortgageable.

How does ARV compare across different cash buyers?

Different buyers may arrive at slightly different ARV estimates for the same property, since they are making judgement calls based on comparable evidence and their own resale strategy. This is one of the reasons it’s worth getting more than one offer when you’re researching your options.

What should stay consistent across reputable buyers is the methodology: ARV based on genuine comparables, a clear breakdown of refurbishment, holding costs, and Stamp Duty, and a written offer that doesn’t move once confirmed. If one buyer’s figure is dramatically out of line with others you’ve spoken to, ask them to justify the gap specifically.

Frequently Asked Questions

What does after repair value (ARV) mean?

After repair value, or ARV, is the estimated resale value of a property once it has been refurbished or repaired to a standard suitable for the open market. It is different from a property’s current value, which reflects its condition as it stands today. A cash buyer uses ARV, not current value, as the starting point for calculating an offer, because ARV represents what the buyer will actually be able to resell the property for once any necessary work is complete.

How is after repair value calculated?

ARV is calculated by looking at recent comparable sales of similar properties in the same area that are already in good, sellable condition. The buyer assesses what your property would be worth if it matched that standard, then works backwards: ARV minus refurbishment costs, holding costs, Stamp Duty surcharges, and a risk margin equals the cash offer. This is why two properties on the same street with the same current value can receive different offers if one needs significantly more work than the other.

Does ARV mean my offer will be higher if my house needs less work?

Generally, yes. If a property is already in good condition and requires little or no refurbishment before resale, the gap between its current value and its ARV is smaller, which typically results in a higher percentage offer relative to market value. Conversely, a property requiring significant work – structural repairs, a full kitchen and bathroom refit, damp treatment – will usually receive a lower percentage offer, because more of the ARV is absorbed by refurbishment costs before the buyer reaches their margin.

Why does a cash buyer use ARV instead of my current valuation?

A cash buyer uses ARV because it reflects what they can actually achieve when they resell the property, which is how their business model works. Your current valuation tells you what the property is worth today, in its current condition, to a typical owner-occupier buyer. But the cash buyer is not planning to live in it – they are planning to refurbish and resell, or rent it out. ARV gives them the realistic ceiling for that future sale, and the offer is calculated downward from that ceiling, not from your current valuation.

Can I challenge a cash buyer’s ARV estimate?

Yes, and you should if the figure seems out of step with what you know about the local market. Ask the buyer for the specific comparable sales they have used to reach their ARV estimate. A reputable buyer will be able to show you recent, genuinely comparable sales – similar size, similar condition after refurbishment, similar location. If they cannot provide this evidence, or the comparables they cite are not genuinely similar to your property, that is a fair basis to question the offer.

Does ARV apply if my property doesn’t need any repairs?

ARV still applies as the starting concept even if your property needs minimal work, but in that case the ARV and the current market value will be close to identical, since there is little or no refurbishment gap to account for. The offer calculation then mainly reflects holding costs, Stamp Duty surcharges, and risk margin, rather than refurbishment spend. This typically results in an offer toward the higher end of the usual 75–85% range, since less of the buyer’s budget is absorbed by repair costs.