How close does a Comp really need to be?

[Bob Ross]

I’d like to buy a small, older home in a high end town with the idea being to add on an addition with a bathroom, garage, family room - whatever it may need to become a more modern home with more square footage. With the goal of gaining significant equity.

I believe it will be important to look for a home with much more expensive homes nearby for comps. But my question is how close will do?

Some thing I’m finding are homes for say 450k with maybe a 1.1 million dall’orso home a couple streets over. Will this work for a Como

If the home to the left and right are 450k as well?

Does the “half mile” rule apply?

Thank you!