Pulling Comps, Am I doing it right (pictures)

Bird Dogs, Wholesaling
1

Let me begin by saying I am new to wholealing I try to pull comps as conservatively as possible, as if every house depends on a hard money loan. Here is a general guideline I use, I would love to have some feedback.

  1. Try and only go back 6 months if possible to get sold comps in determining ARV. If 6 months back does not get enough solid comps, then do 8 months, then 9 months, then maybe 10 at max. If you have to go further back then that ditch subject property not enough solid comps to show ARV.

  2. Need at least 3 solid sold comps

  3. Within +/- 20% Sq Footage of subject property at MAX. I prefer within +/- 10% if possible.

  4. Within +/- 10 years

  5. Same number of bed/bath/garage for comps as subject property if possible. e.g. Subject property is 3/2/2 comps need to be 3/2/2 or 4/2/2. Try and keep same exterior as subject property in comps as well ie. if subj property is frame ext, pick frame comps.

  6. Geographic area for pulling comps, stay within confines of major roads as illustrated below

http://img717.imageshack.us/img717/8338/subjpropertyexample3.png

  1. Once have solid Sold comps, get the median $ per sq ft price and multiply it by the subject properties sq ft. For instance lets say the sold comps based on the above criteria ( 10 years, 20% sq ft etc) show a average price of $63.00 per sq ft and your subject property is 1500 sq ft. You take 1500 x 63.00 to get an estimated ARV of $94,500
2

That all looks pretty good, Samantha. What I always do is to start with very narrow criteria; my ideal comp-pulling criteria. I start at 3 mo’s back, +/- 10%, +/- 10%, same exact specs. If that pulls no comps, then I start to expand a bit. I’ll usually expand the specs first. Because, bottom line, the avg p/sq ft of a 2/1 is the same as a 3/2 on the same street.

If I do that and it still doesn’t pull a comp, or enough comps, then I go expand to 6 months. And yes, I use the avg p/sq ft equation to calculate the ARV. One thing, though, choosing to keep, or discard, a wholesale comp is tricky these days. In the past, we’d discard all wholesale flips because it skewed the retail sales down. But, they are so prevalent these days, that it’s hard to discard them sometimes.

Determining ARV is more challenging than ever these days. If I can pull just one retail comp with a narrowed criteria, I’ll usually go with it.