This is a YouTube video titled "Why ARV is important?" containing a monologue or lecture-style explanation from October 26, 2021, discussing the significance of After Repair Value (ARV) in real estate deal analysis and how subjective ARV estimates impact offer prices and investment decisions.
Foreign. Why is it important? It changes and alters in your numbers and calculations. So those of you in the group, some of you are very new. Maybe you haven't gotten some of the tools that we utilize to analyze deals, but when you do, this will all make sense. Knowing your ARV is important because one of the tools requires you to input it to then give you a suggested offer price based off of the calculations you found for the rehab, the rehab calculator. And if your subjective ARV or your perspective of an ARV is different from, say, mine, even though we might be running the same rehab number, we could be drastically off. Back to my original example, right? So if we're looking at a $50,000 acquisition with a 25k rehab, if I'm running an ARV after repair value on this subject property at a hundred and you're running it at maybe 90, we potentially could be 10 grand off on our offer price between the two of us, and that changes the results, right? Vice versa, if you're aggressive and on your ARV side because of your subjective view on it, and you believe it's 110, and I believe it's 150k purchase, 25 all in on rehab, you potentially can offer 10 grand more than me and take the deal away. So understand the importance of being okay with it. We got to work within ranges, right? Everything we do is within ranges. So knowing your range is crucial with the arv.
