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Comps, or comparable sales, are homes in the same area and very similar in size, condition, and features, as the home you are attempting to buy or sell.
- Location is the most important: The market is based on location, so when trying to determine the value of a home it’s very important to stay as close to the subject property as possible. If there are no comps near by, it’s ok to reach further out but there will always be a boundary to stay within such as a school district.
- Timeframe: The very best comps are homes that are “pending” because that home’s price reflects live market data. When looking at comps, stay with sales from the last three months and don’t look at sales from 6 months ago or longer-those are not a reflection of the current market.
- Consider home features: Look for homes with similar features that have sold. This is more accurate than comparing the price per square foot because that won’t take into consideration the views, updated kitchen, finished basement, etc.
- Don’t over analyze: Don’t drive yourself crazy over various comps; a good Realtor will be able to shed light on why some comps may be better than others.