Choosing Comparable Sales for an Appraisal
Posted On: Aug 19, 2016
Comparable sales, commonly called “comps”, are immensely valuable when determining your home’s value. They compare criteria from similar, recently sold properties in your neighborhood, such as sale price, age of house, size, and square footage. The comps that you provide your appraiser will most likely greatly impact the value of your home, so providing the best possible properties is crucial. Keep in mind the following guidelines appraisers use when selecting comps.
Choose properties that are as close to your address as possible. For suburban neighborhoods, comps can be up to one mile away, and in a more rural neighborhood, up to five miles away. If you are selling a home within a development, choose a comp in the same development for the most accurate comparison.
Try to choose comps that have been sold within the last year. Ideally, comps should have been sold within the last six months. You can also consider using homes that are in contract. In rare instances, it may be acceptable to use a home that has sold more than a year ago, depending on the market and the nature of your home.
It is best to use homes that share the similar characteristics of your own. Style, construction, size, amenities, square footage, and lot size should all be considered. The more similarities you can find between two homes, the better the comp.
Price per square foot
Price per square foot is one of the most trusted measures of valuation. Although it does not take into account important factors such as neighborhood, or the condition of the home, comps with equivalent price per square foot should be considered.