Comparables Definition
Properties that are similar to the subject property. In real estate, a real estate agent checks the selling prices of comparables to help determine the value of a property he is appraising.
Many factors go into determining which properties can really be considered comparables:
- geographic area
- number of bedrooms and bathrooms
- square footage of the land
- square footage of the building on the land
- garage, pool, tennis court, or any other features
- how long ago the sale was
Obviously, the best properties to use as comparables are those that match in every way. If the property next door, with the exact same layout and style, recently sold for $100,000, then that is a great indicator of the value of your property.
Real estate agents generally try to find 4 or 5 comparables to get the best indicator of the value of a property.