Comp discussion for getting a larger HELOC

[Andrew Angerer]

Good morning friends,

My next door neighbor's house just sold for $160k after being fixed and flipped. This is convenient for me because I am soon getting my house appraised for my HELOC. The neighbor's house is a 3/2, smaller in square feet and has a 2 car detached garage, besides that everything is similar, same year of construction, same building materials and size of land. Both properties had only one owner, then were fixed and flipped. My house is a 2/1 and has a one car garage attached, and a huge covered porch.

According to J Scott's book on estimating ARV, I should subtract 3% for the bedroom, I assume the same amount for the bathroom and for the bigger garage. That should put my house at $145k which honestly seems insane since I bought it for 75k only 4 years ago, and have only replaced the hot water heater.

Does this seem right? I want to have a good number in my head for when the appraiser comes by, as I want as large of a HELOC as I can get to cushion me for my real estate investing.

Thanks so much for reading! Have a great day.

[Jonathan Taylor Smith]

@Andrew Angerer - Your logic seems sound; however, have there been any more identical (2/1) sales within like .5 miles over the prior 6 months or so? Also, did I read correctly that your neighbor's house is smaller than yours in square footage, but has an additional bedroom and bath? Does that mean your rooms are much larger or that the extra space is being consumed by some other room(s)? And is the lot size and type the same?

The appraiser is only going to use a 3/2 comp and adjust it down to 2/1 if there are no (or not enough) suitable 2/1 comps within the target area and time-frame.