How to Pull the Right Comps
Your ARV drives every major decision in a flip. It sets your purchase price, determines your budget, and outlines your potential profit. But too many investors juice the comps to justify a deal that doesn’t really work. They pull from different neighborhoods, outdated sales, or homes with completely different finishes. That might help you feel better about the buy, but it doesn’t hold up when it’s time to sell or refinance.
That’s why learning how to pull the right comps is one of the most important skills in real estate investing. Let’s walk through what that actually means.
Know Your Own Property First
Before you start searching for comps, you need to know exactly what you’re working with. That means square footage, bed and bath count, lot size, layout, year built, and general condition. These details aren’t just for your listing; they define what types of properties are even comparable in the first place. You can’t comp a 1,000 sq. ft. ranch to a 2,000 sq. ft. two-story, even if they’re on the same block. And don’t round up. Take a pessimistic view and stay conservative with every number. If you skip this step, your entire ARV estimate is built on the wrong foundation.
Stay Tight on Location
Comps only matter if they’re truly comparable and that starts with geography. A good rule of thumb is to stay within a half-mile radius, but even that can be too far in some markets. You need to look at neighborhood boundaries, school districts, city lines, and other dividing factors.
If a property is across a highway or on the other side of the tracks, it’s not a comp. Two homes might look identical on paper, but if one’s in a different school district or jurisdiction, the values can be drastically different. When in doubt, tighten your radius and get more specific.
Match the Finish Level
Your comps should reflect the renovation you’re actually going to do. If your budget doesn’t allow for quartz countertops, new windows, or custom tile, don’t pull comps from houses that have those features. Buyers pay for finishes, and so do appraisers. Using high-end comps to justify a mid-level rehab is one of the fastest ways to overestimate your ARV. Instead, find sold properties with similar materials, fixtures, and overall quality. The closer the match, the more accurate your numbers will be.
Adjust for Meaningful Differences
Some properties might seem like comps at first glance but fall apart once you look closer. A finished basement, a garage, or a larger lot can all add value, but they don’t make a property comparable if the gap is too wide. And some differences aren’t just adjustments, they’re disqualifiers. If one home backs up to a park and the other backs up to a gas station, they aren’t in the same category. If a comp is across a city line or on the other side of the tracks, it doesn’t belong. Be realistic about what’s worth adjusting for and what just doesn’t match.
Use Only Recent Sales
Old data gives you bad numbers. The market changes fast, and anything older than six months is no longer reliable. In a fast-moving market, even three months can feel outdated. Stick to closed sales, not listings or pending deals. Sellers can ask whatever they want, but only sold comps show what buyers are actually willing to pay. If you can’t find recent comps, that’s a signal to slow down instead of stretching the data to make the deal work.
Your ARV Is Only as Good as Your Comps
If your comps are off, your numbers are off. And if your numbers are off, the deal falls apart. Whether you’re flipping, refinancing, or selling, the market decides what your property is worth, not you. So be strict, be conservative, and don’t cut corners. Good comps are what give you confidence to move forward and help your lender do the same.
