Pricing an assignment when the comps are thin.
The formula is not the hard part. Everyone knows ARV, minus repairs, minus the buyer’s margin, minus your fee. The hard part is that the first number in that line is a guess, and every guess after it inherits the error. Three sales in a mile, two of them nothing like the house, and you still have to say a number out loud on the phone.
In this order. If you have the first one you barely need the rest, and most people start at the fourth because it is the one that loads instantly.
What a cash buyer paid on that block
Last six months, within a few streets, bought by an LLC or paid in full. This is the only comp that tells you what an investor thought the house was worth, which is the number you are actually selling into. One of these beats ten retail sales.
What your own buyer paid you last time
You have a comp nobody else has: the last house you assigned in that area, and what the buyer did with it. If they bought at $84,000 and it is still sitting, your number in that pocket is not $84,000 any more.
The retail comp, adjusted down
A renovated house that sold to a family with a mortgage is a ceiling, not a value. It tells you what the street supports after somebody spends four months and $60,000. Useful for the top end and useless as an offer basis.
The automated estimate
A starting bracket and nothing else. It cannot see the foundation, the tenant, the addition built without a permit, or that the two houses either side are boarded. Never quote it to a seller and never build an offer on it.
Thin comps tempt you into keeping bad ones, because three numbers feel safer than one. They are not safer. A wrong comp does not average out, it drags.
Sold across the main road
Four hundred feet and a different set of buyers. Arterial roads, rail lines and river bends are real price walls, and a map does not draw them.
Different school attendance zone
The single most invisible line on a comp sheet. Two identical houses a block apart can differ by 15% because of which school the six-year-old goes to.
Sold more than six months ago
In a market that is moving in either direction, a nine-month-old sale is a history lesson. Shorten the window before you widen the radius.
Sold with seller concessions
A recorded price of $190,000 with $8,000 back at closing is a $182,000 sale. The concession is in the file and not on the comp sheet, and it is why your number came in high.
Bigger lot, extra bathroom, finished basement
Adjusting for one difference is arithmetic. Adjusting for four is fiction, and by the fourth adjustment you are just writing down the number you wanted.
Rural, mixed blocks, four-bedroom houses in a street of two-bedrooms, anything with acreage. Sometimes the comps are not thin, they do not exist. Stop trying to value the house and price the buyer instead.
A rental buyer is not paying for the ARV. They are paying for the rent. Find what the house rents for, work out what that rent supports at the return buyers in that market accept, and you have a number that does not depend on a resale that may never happen.
Do it on net rent, not on the rent. A house at $1,100 a month is $13,200 a year gross, and a buyer does not keep that. Taxes, insurance, vacancy, maintenance and management take somewhere between 35% and 50% in most markets, so call it $7,900 net. A buyer who needs a 10% return on what they have in the house supports about $79,000 all-in — repairs included. Your offer is that number, minus the repairs, minus your fee.
Use the buyer’s own expense ratio if you know it, and ask them for it, because this is the number they argue about. Running it on gross rent instead gives you roughly $132,000 on the same house, which is how a thin-comp rental deal ends up offered at nearly double what it clears.
This is also the honest conversation to have with the seller. A number backed by what the house earns is easier to defend than a number backed by two sales that are not really comparable, and sellers can tell the difference.
Either way, the arithmetic from the offer down to your fee is the same. The assignment fee calculator runs it in both directions, so you can see what a $10,000 swing in the ARV does to what is left for you.
Do not solve uncertainty by lowballing. A number far under what the house is worth ends the conversation, and you never find out what the seller would have taken. It also gets you a reputation in a small market faster than anything else you can do.
Offer the number your worst credible comp supports, say plainly which sales you used, and keep the inspection period long enough to be wrong in. Uncertainty is a reason to protect yourself in the contract, not a reason to insult somebody on the phone.
And say the number as a number. Somewhere in the low one-fifties is not an offer. $152,000, based on the two sales on Dexter, is.
Every deal you price in a thin market is a comp you are creating. Write down what you offered, what the seller countered, what it eventually sold for and what your buyer said about the number. Six of those in one zip code and you stop needing anybody else’s data for that zip code.
This is the whole reason to keep a record at all. Not tidiness. In eighteen months the deals you worked are the only comp set that was built by someone who actually walked the houses.
Your own past deals are the comp set nobody else has.
You press NEXT STEP after a call and answer what that stage needs — the number you offered, what they countered, why it died if it died. The Timeline writes itself, and the offers and outcomes stay searchable by area, so the next thin-comp house in that pocket starts from something real. Nothing to set up.