The ARV Conundrum

[Curtis C.]

When determining ARV I often face a conundrum with the subject property given the variance between houses in good condition, vs flips with high finish out.

Lets say these are all comparable properties, brick exterior 1,500 sq ft 3/2/2

• Comp 1: Sold for 149 well maintained house
• Comp 2: Sold for 150 some minor updates
• Comp 3: Sold for 165 flip high level finish out
• Comp 4: Sold for 166 flip high level finish out

Our hypothetical subject property is the same as the comps but our exit strategy for it is a rental. How would you price the ARV? My thought would be to discard the higher end flip finish outs, and go with the comps that are in good condition or well maintained. Because when you rehab a house as a rental as the exit in mind, your finish level will not be as high as the flippers.

In this case if the subject property would be a rental I would say the ARV is 150k.

Do you guys agree with this reasoning? Thanks for your fedback