How to calculate an ARV for a 4 units or less income property

[Andy Fernandez]

Good morning BP I have a big question:

I am looking for the correct formula to calculate the ARV on a fourplex. I understand the ARV of an income property is calculate as ARV= NOI/ CAP rate. If you need to do this calculation and you have your NOI but you do not have a purchase to calculate your CAP Rate what do you do ? ( I do not want to goggle a Cap Rate for the area where the property is located) what do you do ?

I am looking for a way to calculate manually ARV, in other words I need to know from where the number comes from.

Any help will be highly appreciated.

[Greg Dickerson]

Originally posted by @Andy Fernandez:

Good morning BP I have a big question:

I am looking for the correct formula to calculate the ARV on a fourplex. I understand the ARV of an income property is calculate as ARV= NOI/ CAP rate. If you need to do this calculation and you have your NOI but you do not have a purchase to calculate your CAP Rate what do you do ? ( I do not want to goggle a Cap Rate for the area where the property is located) what do you do ?

I am looking for a way to calculate manually ARV, in other words I need to know from where the number comes from.

Any help will be highly appreciated.

For smaller properties like this Appraisers will use comps supported by CAP Rate and replacement cost.