Most investors do not have an ARV problem. They have a defensibility problem. The number is fine right up until someone with money asks how you got it.
The three tests
A defensible ARV survives three questions from a lender, a partner, or an appraiser:
- Would an appraiser pull these same comps? Same subdivision or a competing one, similar square footage, similar lot, similar vintage, closed inside six months.
- Are the adjustments written down? A comp that is 300 feet larger and has a pool is not the same house. If you cannot show the adjustment math, you do not have an ARV, you have a hope.
- Does it hold if the best comp disappears? Pull the top comp out. If the number moves more than a few percent, it was carried by one sale, and one sale is not a market.
Where the number usually breaks
- Comping to list price instead of closed price. Active listings tell you what sellers want, not what buyers paid.
- Ignoring condition. A flipped comp with a new kitchen is only your comp if your scope includes a new kitchen.
- Stretching the radius. Every quarter mile you add is a school boundary, a flood zone, or a different buyer.
- Rounding up. A $412,000 supported value becomes "call it 425" and the whole deal is now built on $13,000 that does not exist.
What we deliver
Every ANALYST engagement includes the comp set, the adjustments, the supported value, and the walk-away number — in a PDF you can hand to a lender without editing it first.
That last part matters. If you have to rewrite the analysis before showing it to money, it was not an analysis.