In order to research what properties are selling for you need to get access to the MLS. You can access recent comparale sales on Zillow/Redfin or using our Comps Tool which pulls recent comparable sales from your local county records.
To estimate the After Repair Value of a property you want to step into the shoes of an Appraiser. Home Appraisers use an appraisal method called the Sales Comparison Approach which compares recent comparable sales of similar properties in the area.
To estimate the value of a property the Appraiser will 'pull comps' of 3 to 5 comparable properties that have sold within the last 1 to 6 months (more recent the better). Recent comparable sales should be in close proximity to your property, have similar square footage, # of beds/baths, similar level of finishes and amenities.
The Appraiser then compares the 'Subject Property's' features and amenities with the comparables and makes pricing adjustments up and down to create an equilibrium and make the properties apples-to-apples. The Appraiser then uses price adjustments to adjust the Sales Prices of the comparables to estimate an approximate value of the 'Subject Property'.
Where Can You Find Comps?
In order to research what properties are selling for you need to get access to the MLS.
- Realtor - Your real estate agent should be able to get you access to the MLS. Have your Agent pull Comparable Sales information dating back 4 to 6 months so you can get a full understanding of comparable sales prices & the average days-on-market.
- Zillow/Redfin - If you can't get direct access to the MLS, Zillow & Redfin can be decent resources for finding recently sold information, but unfortunately their data feed can be delayed.
- Our Comps Tool - Our current comps tool will provide a list of recent comparable sales that you can use to build your Comps Reports.
Identify 3 To 5 Of The Best Comps
Once you receive your CMA, you and your Agent should try to identify the 3 to 5 of the best, most comparable properties.
- Similar square footage - Appraisers compare homes based upon the square footage of the property. Therefore, you need to find comps that have similar square footage, ideally within +/- 10%.
- Similar amenities, upgrades & condition - Appraisers adjust property values based upon property amenities and upgrades. If other homes have 3 bathrooms and your property only has 2, the appraiser will deduct value from your property appraisal.
- Similar age of construction - Mixed-age subdivisions are common, but the prices of the properties will vary depending on the year it was built. A brand new home will be more expensive than a home built in the 1980s. Ideally, when identifying comps the age of the home should be within a few years.
- Location - Everyone knows real estate is valued on location, location, location, but do you know what that means? Compare your home to similar locations. If your home sits next to a busy, noisy highway, look for other homes that are located with highway exposure.
- Sales Date - Real estate market values can change quickly, so it's important to use recent comparable sales dates of less than 6 months.
