Most wholesalers are ranking their comps wrong. After about a thousand deals over the last six years, the variable I see most under-weighted in every comp tool I've ever used is story count.
A two-story comp on a one-story subject will swing your ARV 10 to 15%. You won't see it coming until the appraisal kills your buyer at closing.
Here's the order I actually weight comps in:
- Stories
- Recency
- Proximity
- Sqft (within ±50 to 100)
- Bed
- Bath
A few rules that come out of that order:
A 6-month-old sale on the same block in the same condition will out-predict a 30-day-old sale two miles away in a different sub-market. Almost every time.
Don't extrapolate PSF off comps that are 50%+ different in size from your subject. A 1,200 sqft subject pulled off 1,800 sqft comps will give you $40K swings in your ARV.
Two clean comps both at $300K? Your ARV is $300K. The "minimum 3 comps" rule was written for appraisers. A clean 2-comp match in a tight band beats a 3-comp average that drags in junk.
5% deadband on the PSF-vs-price-median blend. If they agree, your number holds. If they disagree by more than 5%, something's off about the subject. Usually sqft from the tax roll, especially if there's a garage conversion or a permit-less addition.
In non-disclosure states (TX, KS, AK, ID, LA, MS, MO, MT, NM, ND, UT, WY) you have no public sold prices. Default to active listings and price 8 to 12% under list for what'll actually transact.
Run that order against your last five deals. I'd bet money one of them was mis-comped on stories alone.
Disclosure: I just launched a tool that does all of this automatically. It's called OffrStack. The logic above is what's baked into it. Mods, happy to remove if this crosses the line. The playbook stands either way and I'm not dropping a link in the post. If anyone wants to run 25 free deals through it before deciding anything, comment and I'll get you set up!