source:
  type: guide
  id: fnma-sel-b4-1.3-08
  authority: Fannie Mae Selling Guide B4-1.3-08 — Comparable Sales
  description: Fannie Mae Selling Guide B4-1.3-08 — Comparable Sales.
  coverage_tier: operative
obligations:
- id: fnma-sel-b4-1.3-08-full
  canonical_id: fnma-sel-b4-1.3-08-full
  section: Fannie Mae Selling Guide B4-1.3-08 — Comparable Sales
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B4-1.3-08 — Comparable Sales
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B4-1.3-08, Comparable Sales (06/04/2025) Introduction This topic
      contains information on selection of comparable sales, including: Selection
      of Comparable Sales Minimum Number of Comparable Sales Age of the Comparable
      Sales Additional Requirements for New (or Recently Converted) Condos, Subdivisions,
      or PUDS Rural Properties Use of Foreclosures and Short Sales Uniform Appraisal
      Dataset (UAD) 3.6 Policy Selection of Comparable Sales The appraiser is responsible
      for determining which comparables are the best and most appropriate for the
      assignment. Fannie Mae expects the appraiser to account for all factors that
      aﬀect value when completing the analysis. Comparable sales should have similar
      physical and legal characteristics when compared to the subject property. These
      characteristics include, but are not limited to, site, room count, ﬁnished area,
      style, and condition. External factors, including Federal Emergency Management
      Agency (FEMA) designated ﬂood zone, should be given consideration when selecting
      comparables. When choosing comparable sales, the appraiser should examine the
      market area of the subject property, assess its characteristics, and identify
      similar comparable sales. Market area is deﬁned as the geographic region, for
      a subject property, from which most demand comes and in which most of the competition
      is located. This does not mean comparable sales must be identical to the subject
      property, but instead should be competitive and appeal to the same market participants
      that would also consider purchasing the subject property. If the available comparable
      sales are not similar, the appraiser needs to decide whether an expansion of
      the market area search is appropriate. If this occurs, the appraiser must provide
      commentary to explain the rationale for selecting comparable sales outside the
      subject''s market area and make location adjustments if warranted. Comparable
      sales from within the same market area (including subdivision or project) as
      the subject property should be used when possible and must be used in certain
      instances (see below). Sale activity from within the neighborhood is the best
      indicator of value as sales prices of comparable properties from the same location
      should reﬂect the same positive and negative location characteristics. Fannie
      Mae does allow for the use of comparable sales located in competing market areas,
      as these may simply be the best comparables available and the most appropriate
      for the appraiser’s analysis. If this situation arises, Published May 6, 2026
      580 the appraiser must not expand the neighborhood boundaries just to encompass
      the comparables selected. The appraiser must indicate the comparables are from
      a competing neighborhood and address any diﬀerences that exist. The appraiser
      must also provide an explanation as to why they used the speciﬁc comparable
      sales in the appraisal report and include a discussion of how a competing neighborhood
      is comparable to the subject''s neighborhood. If a property is located in an
      area in which there is a shortage of truly comparable sales, either because
      of the nature of the property improvements or the relatively low number of sales
      transactions in the neighborhood, the appraiser might need to use properties
      that are not truly comparable to the subject property. In some situations, properties
      that are not truly comparable may simply be the best available and the most
      appropriate for the appraiser’s analysis. The use of such sales is acceptable
      if the appraiser adequately documents the analysis and explains why they were
      used. (For additional information, see B4-1.3-03, Neighborhood Section of the
      Appraisal Report. When describing the proximity of the comparable sale to the
      subject property, the appraiser must be speciﬁc with respect to the distance
      in terms of miles and include the applicable directional indicator (for example,
      “1.75 miles NW”). The distance between the subject property and each comparable
      property is to be measured using a straight line between the properties. Minimum
      Number of Comparable Sales A minimum of three closed comparables must be reported
      in the sales comparison approach. Additional comparable sales may be reported
      to support the opinion of market value provided by the appraiser. The subject
      property can be used as a fourth comparable sale or as supporting data if it
      was previously closed. Contract oﬀerings and current listings can be used as
      supporting data, if appropriate. See Additional Requirements for New (or Recently
      Converted) Condos, Subdivisions, or PUDs below for exceptions to this policy.
      In no instance may the appraiser create comparable sales by combining vacant
      land sales with the contract purchase price of a home (improvements only). While
      these transactions cannot be used to meet the required minimum three closed
      comparables, these transactions, which are often completed as part of a construction-to-
      permanent loan transaction, may be included as additional support with appropriate
      commentary. Age of the Comparable Sales Comparable sales that have closed within
      the last 12 months should be used in the appraisal; however, the best and most
      appropriate comparable sales may not always be the most recent sales. For example,
      it may be appropriate for the appraiser to use a nine month old sale with a
      time adjustment rather than a one month old sale that requires multiple adjustments.
      An older sale may be more appropriate in situations when market conditions have
      aﬀected the availability of recent sales, and the changing market conditions
      causing their use must be explained in the report. Additionally, older comparable
      sales that are the best indicator of value for the subject property can be used
      if appropriate. For example, if the subject property is located in a rural area
      that has minimal sales activity, the appraiser may not be able to locate three
      truly comparable sales that sold in the last 12 months. In this case, the appraiser
      may use older comparable sales if they explain why they are being used. Published
      May 6, 2026 581 Additional Requirements for New (or Recently Converted) Condos,
      Subdivisions, or PUDS If the subject property is located in a new (or recently
      converted) condo project, subdivision, or PUD, it must be compared to other
      properties in the same market area and to properties within the subject condo
      project, subdivision, or PUD. This comparison should help demonstrate market
      acceptance of new developments and the properties within them. Generally, a
      subdivision is considered new when there are limited or no resales or the builder
      or developer is involved in the marketing or sale of the properties. See B4-2.1-01,
      General Information on Project Standards and B4-2.3-01, Eligibility Requirements
      for Units in PUD Projects for the deﬁnition of a new condo project or PUD. At
      a minimum, the appraisal report for these properties must include the following:
      At least one settled comparable sale from the subject condo project, subdivision,
      or PUD. (A resale is preferable if it is veriﬁable and does not involve the
      subject builder or developer). At least one settled comparable sale from outside
      the subject condo project, subdivision, or PUD. A third settled comparable sale
      can be from inside or outside of the subject condo project, subdivision, or
      PUD. Settled comparable sales or resales from within the subject condo project,
      subdivision, or PUD are preferable to settled sales from outside the condo project,
      subdivision, or PUD provided the builder or developer of the subject property
      is not involved in those transactions. In the event there are no settled comparable
      sales inside a new condo project, subdivision, or PUD because the subject property
      transaction is one of the ﬁrst units to sell, the appraiser may use two pending
      sales in the subject project, subdivision, or PUD in lieu of one settled sale.
      The appraiser must also use at least three settled comparable sales from projects,
      subdivisions, or PUDs outside of the subject project, subdivision, or PUD. If
      the subject property is part of a newly built or recently converted condo project,
      subdivision, or PUD that has 2-20 units and there are no settled or pending
      sales, the appraiser may use comparable sales from a competing project, subdivision,
      or PUD. The requirements in the following table apply. ✓ The appraisal report
      must... Use competing projects, subdivisions, or PUDs of a similar size and
      type. Explain why the comparable sales were chosen and demonstrate market acceptance.
      Describe how the condo project, subdivision, or PUD chosen compares to the subject
      property. Note: If the subject property is not the ﬁrst unit under contract
      in the condo project, subdivision, or PUD, the appraiser must include one under
      contract sale from the subject''s project, subdivision, or PUD as a supplemental
      exhibit. To meet the requirement that the appraiser utilize one comparable sale
      from inside the subject project, subdivision, or PUD, the appraiser may need
      to rely solely on the builder of the property they are appraising, as Published
      May 6, 2026 582 this data may not yet be available through typical data sources
      (for example, public records or multiple listing services). In this scenario,
      it is acceptable for the appraiser to verify the transaction of the comparable
      sale by viewing a copy of the settlement statement from the builder’s ﬁle. When
      providing builder sales from competing projects that are not presently available
      through traditional data sources, the appraiser must verify the sale from the
      applicable settlement statement and indicate on the appraisal report that the
      settlement statement was the document utilized for veriﬁcation. Additionally,
      the appraisal must include discussion and analysis of sales concessions and
      upgrades for the subject property relative to concessions and upgrades for each
      builder sale. (For special appraisal considerations regarding condo projects,
      see B4-1.4-03, Condo Appraisal Requirements.) Rural Properties Rural properties
      often have large lot sizes, and rural locations can be relatively undeveloped.
      Therefore, there may be a shortage (or absence) of recent truly comparable sales
      in the immediate vicinity of a subject property. If the appraiser''s analysis
      of the market data shows the best indicators of value for the subject property
      are a considerable distance away, those comparable sales can be used if it produces
      credible assignment results. The appraisal must include an explanation of why
      the particular comparables were selected. Use of Foreclosures and Short Sales
      It is acceptable to use foreclosures and short sales as comparables if the market
      data indicates they are the best and most appropriate sales available. The appraiser
      must address in the appraisal report the prevalence of such sales in the subject’s
      neighborhood and their impact. The appraiser must identify and consider any
      diﬀerences from the subject property, such as the condition of the property
      and whether any stigma has been associated with it. The appraiser cannot assume
      it is equal to the subject property. For example, a foreclosure or short sale
      property may be in worse condition when compared to the subject property, especially
      if the subject property is new construction or was recently renovated. For appraisals
      that are required to be UAD compliant, the appraiser must identify the ﬁnancing
      type as REO sale or short sale, as appropriate. (For speciﬁc information regarding
      comparable sale adjustments, see B4-1.3-09, Adjustments to Comparable Sales,
      and for information regarding ﬁnancing types, see Fannie Mae and Freddie Mac
      Uniform Appraisal Dataset Speciﬁcation, Appendix D: Field-Speciﬁc Standardization
      Requirements. Uniform Appraisal Dataset (UAD) 3.6 Policy Lenders using UAD 3.6
      must follow the requirements in the UAD 3.6 Policy Supplement. Recent Related
      Announcements The table below provides references to recently issued Announcements
      that are related to this topic. Announcements Issue Date Announcement SEL-2025-04
      June 04, 2025 Published May 6, 2026 583 Announcements Issue Date Announcement
      SEL-2024-07 November 06, 2024 Announcement SEL-2024-06 September 04, 2024 Announcement
      SEL-2022-02 March 02, 2022 Announcement SEL-2021-11 December 15, 2021'
  judgment: false
