Verifying arms-length status helps ensure that comparable data reflects what?

• A. Geological features
• B. Comparable sales data reflects market behavior
• C. Insurance costs
• D. Age of roof

Answer: (B)

Arms-length status means the sale happened between unrelated, willing participants without pressure or special concessions. Verifying this status ensures the data from comparable sales reflect how the market actually behaves—prices negotiated under typical market conditions rather than influenced by relationships or non-market incentives. That keeps the comps’ data representative of market behavior, which is essential for an accurate value.

Geological features, insurance costs, or the age of the roof are just property characteristics or costs and don’t relate to whether the sale was conducted at arm’s length. If a sale isn’t arms-length, it can distort the data and may need adjustments or exclusion.