Quick answer: You need a minimum of three solid, highly comparable sold properties from the last 90 days to establish a reliable ARV. Relying on one or two outlier sales creates a false valuation floor or ceiling that will cause you to either overpay for a property or walk away from a deal that was actually fine.
Don’t base your whole deal on one high sale. It’s an easy trap to fall into, you pull up a recent sale two streets over, it’s renovated, it’s close, the number looks great, and suddenly your whole offer is built around it. The problem is that a single comp tells you almost nothing on its own. It could be a legitimate market value. It could also be an outlier, a motivated buyer who overpaid, a seller who got lucky, or a property with upgrades that never showed up in the listing photos. You have no way to know which one you’re looking at until you compare it against others.
The Rule of 3
Here’s a simple way to think about it: one comp is an anomaly, two comps show a trend, and three comps start to create an actual baseline you can trust. With just one data point, you have no context for whether that sale was typical or an outlier. Two comps start to suggest a direction, but they could still both be skewed the same way by something you’re not seeing. Three genuinely comparable comps is where the picture starts to stabilize, since it becomes much harder for all three to be wrong in the same direction by coincidence.
Three is the practical floor, not necessarily the ceiling. According to ATTOM Data Solutions, investors who analyze at least five comparable sales per deal achieve meaningfully more accurate valuations than those relying on fewer. If you can find five solid comps instead of three, that extra data almost always makes your ARV more defensible, especially on a property in a market with more price variation than usual.
What Counts as a “Solid” Comp
Not every recent sale nearby actually qualifies as a usable comp. A comp that’s genuinely worth including in your ARV calculation should meet a few criteria:
Sold within the last 90 days. In slower-moving markets, up to 180 days can still be workable, but the further back you go, the more the number reflects a market that may no longer exist.
Located within 0.25 to 0.5 miles. Even within the same town, values can shift meaningfully block to block, so proximity matters more than people often assume.
Same property style. A renovated colonial isn’t a fair comparison for a rancher, even if they’re on the same street and similarly sized.
Within 15-20% of the subject property’s square footage. Comps that are dramatically larger or smaller distort the price-per-square-foot math the whole calculation depends on.
A sale that misses two or three of these criteria isn’t necessarily useless, but it shouldn’t be treated as equal weight to a comp that checks every box.
What to Do When You Have Too Many (or Too Few) Comps
Sometimes the problem isn’t finding comps, it’s narrowing down too many of them. If you’re staring at a list of ten possible comps, don’t just average all ten together. Rank them by how closely they match your subject property on the criteria above, then keep the top three to five and set the rest aside as reference points rather than direct inputs. A close, recent, similarly-styled comp should always carry more weight than a technically-nearby sale that’s a stretch on every other factor.
The opposite problem, not enough recent sold comps, comes up often in slower or more rural markets. When sold data is genuinely thin, active and pending listings can be used cautiously as a secondary reference point, they’ll tell you what sellers are asking or what buyers have already agreed to pay, even if the sale hasn’t officially closed yet. Just don’t treat them the same as a closed sale. An asking price is a hope, not a fact, and even a pending sale can still fall through before closing.
Common Questions on Comparable Sales
Can you calculate ARV with just one comp?
Technically, yes, but it’s not reliable. A single comp gives you no way to tell whether that sale reflects the actual market or was an outlier in either direction, which is exactly the trap that leads investors to overpay or pass on good deals.
How old can a comp be and still count?
Ideally within the last 90 days. Up to 180 days can still work in a slower market with less price movement, but anything older than that starts to reflect a market that may have already shifted, especially in faster-moving areas.
What if my comps show wildly different values?
A wide spread usually means one or more of your comps isn’t as comparable as it first looked, check condition, exact location, and property style again before assuming the market itself is just inconsistent. If the spread persists even after re-checking, lean toward the lower end of your range rather than the average, since overestimating ARV is the more expensive mistake.
Do pending or active listings count as comps?
Not as primary comps, since neither reflects a confirmed sale price. They can be useful secondary context when sold data is thin, but they should never carry the same weight as an actual closed sale.
Getting your comps right is most of the battle in getting ARV right, and getting ARV right is most of the battle in making a good offer in the first place. If you want help running comp analysis faster, our Wholesaling Coach GPT includes prompts built specifically for pulling and analyzing comps, and our full guide on how to calculate ARV covers the rest of the process from there.
