A “valid” sale is one that can be used to estimate what other buyers would pay for other properties, because both the buyer and seller were typically motivated, well informed and previously unconnected. These are factors that must be true for real give and take negotiations to take place.
Market value is defined as the amount a typical, well-informed purchaser would be willing to pay for a property. The seller and buyer must be unrelated, the seller must be willing, but not under pressure to sell, and the buyer must be willing, but not under any obligation to buy. The property must be on the market for a reasonable length of time, the payment must be in cash or its equivalent, and the financing must be typical for that type of property.
An appraiser must determine if the price paid for a property is a price most typical, well informed and unpressured buyers would have paid for a property before using it to help estimate what other “open-market, arms-length buyers and sellers would agree to.