The foundation of accurate property valuation - finding and analyzing similar sold properties.
Comparable sales (comps) are recently sold properties that are similar to your subject property. They're used to determine fair market value and ARV.
Not all sales are good comps. Use these criteria in order of importance:
Within 0.5 mile radius, same neighborhood, same school district. Cross a major road or boundary = different market.
Last 90 days ideal, 120 days maximum. Markets change fast - old comps = bad data.
Within ±15% of subject property. A 1,500 sqft home isn't comparable to 2,500 sqft.
Same or ±1 bedroom/bathroom. A 2BR is a different product than a 4BR.
Match the AFTER condition for ARV. Don't compare distressed to renovated.
Similar era and construction style. A 1960s ranch vs 2020 modern = different buyers.
Find 3-5 solid comps that match your subject property's AFTER condition. The average of these tells you the ARV. Better comps = better offers = more deals closed.