Finding Comparable Properties (Comps)
Why pricing your multi-family or single-family home is incredibly important and needs comps
If you don’t price it correctly, you won’t be able to bring in the right profit for it — so that means you need to settle on the right listing price before you put your property on the market.
The best way to figure out the right listing price is to have a professional REALTOR® perform a comparative market analysis, or CMA. Your REALTOR can help you settle on a price that helps you sell your property, whether it’s a duplex, triplex, fourplex or single-family home, quickly and easily.
To find the right price, your agent will search for comparable properties (commonly called comps). Here’s what you need to know.
What Are Comps in Real Estate?
In real estate, comparables are properties similar to yours. In order for a property to be a good comp, it must be similar in size, location, condition and features – and it must have recently sold within the last 3-6 months.
What Does a Comp Tell You?
A comp tells you how much a buyer was recently willing to pay for a very similar property. When your REALTOR combines data from several comps, they get a good picture of market conditions. That enables them to tell you what a buyer is likely to be willing to pay for your duplex, triplex, fourplex or single-family home.
How Can You Find Your Own Comps?
You can find your own comps if you’d like, but your best bet for accuracy is to work with a REALTOR who understands exactly how to pull the right data and make the appropriate calculations. If you’d like to find your own comps, your best source of information will be local real estate websites (including this one). You can also pull public property records, which may require you to visit the county recorder’s office.
If you find your own comps, try to use at least three or more properties that are similar in:
- Location
- Size
- Bedrooms
- Bathrooms
- Condition
- Age
- Nearby amenities
- Lot size square footage
Make sure the homes have sold within the past three months (or, if you really want to stretch it, six months). Banks and Appraisers will usually stick to three months.
Pro Tip: Don’t use homes that haven’t sold yet. You don’t know what a buyer is willing to pay for them because – well, because a buyer hasn’t paid for them yet.
Remember:
- Compare only similar properties. Don’t compare a duplex with a triplex, or a house with a fourplex, for example.
- Try to see comparable properties in person before you make any calculations. That way, you can make sure you’re using the right property.
- For the best accuracy, contact a REALTOR for a FREE comparative market analysis. That’s the simplest way to get comps for your duplex, triplex, fourplex, or single-family home.
