Running comps for a wholesale deal (without botching your ARV)

Every deal you ever blow up will trace back to one number you got wrong: the After-Repair Value. Run your comps loose and your ARV is fiction — you overpay the seller, your cash buyer walks, and your assignment fee evaporates. Run your comps tight and the whole deal holds. Running comps is the single most transferable skill in off-market real estate, and most people never actually learn it. Here's how to do it right, brick by brick.

First, the honest part

Comping is an estimate, not an appraisal. A licensed appraiser or a broker's CMA carries weight your spreadsheet doesn't, and valuation rules and wholesaling laws vary by state — some activity may require a license. This is educational content, not legal, tax, or investment advice, and we're not your attorney. Before you tie up a property or quote a buyer a number, do your own diligence and talk to a local real estate attorney. Results vary; nobody on the internet can promise you a payday.

What a "comp" actually is

A comp — short for "comparable sale" — is a property similar to your subject that already sold, recently, nearby. The logic is the bedrock of how property gets valued: the sales comparison approach is the method appraisers lean on for residential homes, estimating value from recent sales of similar properties with adjustments for the differences. That's per the Uniform Standards of Professional Appraisal Practice (USPAP), maintained by The Appraisal Foundation, and it's echoed in Fannie Mae's Selling Guide appraisal requirements, which direct appraisers to recent, comparable, arm's-length sales.

Two words there matter. Sold — not listed, not "for sale," not Zillow's automated guess. A list price is a wish; a sold price is a fact. And arm's-length — a normal sale between unrelated parties, not Grandma deeding the house to her grandkid for a dollar. Those off-market transfers will wreck your average if you let them in.

The 6 rules of a true comparable

Not every nearby sale is a comp. A real comparable passes all six of these, and the Consumer Financial Protection Bureau echoes the same logic in how it describes appraisals to consumers — value is anchored to recent sales of similar homes:

1. Sold, not listed. Closed transactions only. Pendings and actives are clues, not comps.
2. Recent. The tighter the better — commonly the last 3 to 6 months. Lenders generally want sales within the last 6 to 12 months, so the fresher your comps, the more your number survives an appraisal.
3. Close. Same neighborhood, ideally within about half a mile — and never cross a hard boundary (a highway, a school-district line, a different subdivision) that changes what buyers pay.
4. Similar size. Within roughly 20% of your subject's square footage. A 1,000-sq-ft ranch is not a comp for a 2,400-sq-ft two-story.
5. Similar type and age. Single-family compares to single-family; a 1920s bungalow isn't priced like new construction.
6. Arm's-length and clean. No foreclosure auctions, no estate fire-sales, no family transfers — unless your subject is also a distressed sale and you're pricing it that way on purpose.

Get three to five sales that clear all six and you've got a comp set you can defend.

Pulling comps without an MLS

Wholesalers usually don't have direct MLS access. You don't strictly need it — you need sold data, and a lot of it is public or accessible:

• County recorder / clerk of deeds. Deeds are public record, and recorded sale prices and dates live here. This is your free source of truth for what actually closed (some states are non-disclosure, where prices aren't recorded — know which one you're in).
• County assessor / property appraiser. Square footage, bed/bath, lot size, year built, and often the sale history. Free, and it's where you confirm your subject's specs too.
• A wholesaler-friendly agent. The fastest path to clean sold comps is a relationship with an agent who'll pull the MLS for you. Bring them buyers and it's a two-way street.
• Paid data tools. When speed and rigor matter, paid sold-comp data earns its keep on every deal it saves you from.

This is the same public-data muscle that finds the deal in the first place — see how to find off-market properties with no money. On Squatters, Recon pulls public property and market signals into one place so you spend your time on the comps that matter instead of digging through ten county websites.

Making adjustments (this is where it gets real)

No two houses are identical, so you adjust each comp toward your subject. You're answering one question: what would this comp have sold for if it were exactly like my house? The mechanic, straight from the sales comparison approach in USPAP and Fannie Mae's guidance: adjust the comp, not the subject, and adjust toward the subject.

• If a comp has something better than your subject (extra bedroom, finished basement, new roof, bigger lot), you subtract value from the comp.
• If a comp has something worse (older kitchen, smaller, no garage), you add value to the comp.

Common line items: square footage (a per-foot adjustment), bed/bath count, garage, lot size, condition, and updates. Keep adjustments honest and modest — if a single comp needs huge adjustments to fit, it's not really a comp. Toss it and find a closer one. When your three to five adjusted comps cluster in a tight range, that range is your ARV. When they're all over the place, your comp set is bad — not your subject mysterious.

ARV math (and the number cash buyers actually trust)

Your ARV (After-Repair Value) is what the subject is worth fully renovated to the standard of your adjusted comps — not its beat-up condition today. Take your set of adjusted comps, find where they cluster, and that's your ARV. Don't cherry-pick the highest sale because you want the deal to work; that's exactly how wholesalers torch their reputation when the buyer's own comps come back lower.

The honest gut-check: would a real cash buyer, looking at these same sold comps, agree with your ARV? If you have to squint, fudge, or ignore the comps that hurt, your number is wrong.

From ARV to MAO (the 70% rule)

Once your ARV is solid, the Maximum Allowable Offer (MAO) tells you the most you can pay and still leave room for everyone. The common starting frame is the 70% rule:

MAO = (ARV × 0.70) − Estimated Repairs − Your Assignment Fee

The 70% isn't law — it's a guardrail that bakes in the end buyer's profit and holding costs, with your fee carved out so the deal still pencils for them. Hot markets run higher (75%+); rough ones run lower. The discipline is the same every time: never make an offer you can't back out of the comps and a real repair estimate. For the full deal walkthrough, see the come-up playbook for your first off-market deal, and for the legal line on assigning, what wholesaling actually is.

Common comping mistakes that kill deals

• Using list prices instead of sold prices. A wish is not a value.
• Reaching for distance or time. A perfect comp from a mile away or a year ago is worse than a decent one next door from last month.
• Letting non-arm's-length sales in. Foreclosures and family transfers drag your average down or up.
• Crossing an invisible boundary. Same ZIP, different school district or the wrong side of a busy road = different buyers, different prices.
• Adjusting to fit the answer you want. Picking comps and adjustments to justify a number you already decided is how you blow your ARV — and your credibility with the buyer.
• Trusting an automated value (AVM) as gospel. Online estimates are a starting point, not a comp set. They don't see the inside of the house or your specific block.

Frequently asked questions

How many comps do I need?

Three to five solid ones beats ten weak ones. You want a tight cluster of recent, close, similar, arm's-length sales you can defend to a cash buyer. If your comps are scattered all over a price range, the answer isn't "average them" — it's go find better comps.

Can I just use Zillow's Zestimate?

Use it as a rough starting point, not your ARV. Automated valuations are estimates built from broad data and can miss condition, location nuance, and recent neighborhood shifts. Pull the actual sold comps and run them yourself — that's the number a buyer or appraiser will check you against.

What if there are no recent sales near my subject?

Widen carefully, in this order: stretch the time window before the distance, stay inside the same neighborhood and boundaries, and keep size and type tight. If you truly can't build a clean comp set, the honest move is to treat the deal as higher-risk — or pass. A number you can't defend isn't a number.

Sources

• The Appraisal Foundation — Uniform Standards of Professional Appraisal Practice (USPAP), the sales comparison approach
• Fannie Mae — Selling Guide, appraisal requirements and comparable sales selection
• Consumer Financial Protection Bureau (CFPB) — consumer guidance on home appraisals
• Investopedia — definitions of After-Repair Value (ARV), comparable sales (comps), and the sales comparison approach
• U.S. county recorder/clerk of deeds and assessor offices — public records of recorded sales and property characteristics

Where Squatters fits

Comping is a skill, and skills are learned, not bought. The free Come-Up Academy on Squatters walks you through running comps and ARV math on real practice deals — no $2,000 course required. Recon surfaces the public property and market data so you're not hunting across ten county sites, and Bandit, our AI deal agent, helps you pressure-test the numbers before you commit. And the Block is a crew that's actually run these deals, so you learn from people who've done it.

Browse more guides on the blog, or drop in and learn it hands-on.

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Squatters is a software platform and community for real estate investors — not a law firm, broker-dealer, or investment adviser. Nothing here is legal, tax, or investment advice. Valuation is an estimate, not an appraisal; comping accuracy, deal outcomes, and wholesaling rules vary by state and some activity may require a license. Always do your own diligence, comply with all applicable laws, and consult a local attorney.