How to Use Comparable Sales to Price Your Home

Before you put your home up for sale, use the right comparable sales to find the perfect price.

Knowing how much homes similar to yours sold for gives you the best idea of the current estimated value of your home. The trick is finding sales that closely match yours.

What makes a good comparable sale?

Your best comparable sale is the same model as your house in the same subdivision — and it closed escrow last week. If you can’t find that, here are other factors that count:

  • Location: The closer to your house the better, but don’t just use any comparable sale within a mile radius. A good comparable sale is a house in your neighborhood, your subdivision, on the same type of street as your house, and in your school district.
  • Home type: Try to find comparable sales that are like your home in style, single or 2-level, year of build, square footage, number of bedrooms and baths, 2- or 3-car garage or more, yard size, water front lot or green belt or not, view fence or backing to major street.
  • Amenities and upgrades: Is the kitchen or bath new? Does the comparable sales have granite counter, tile or wood flooring, shutter or blinds, pool? Does your community have the same amenities (pool, workout room, walking trails, etc.) and homeowners association fees?
  • Date of sale: You may want to use a comparable sale from two years ago when the market was high, but that won’t fly. Most buyers use government-guaranteed mortgages, and those lending programs say comparable sales can be no older than 90 days.
Agents can help adjust price based on insider insights

Even if you live in a subdivision, your home will always be different from your neighbors’. Evaluating those differences—like the fact that your home has one more bedroom than the comparables or a basement office — is one of the ways real estate agents add value. An active agent has been inside a lot of homes in your neighborhood and knows all sorts of details about comparable sales. He has read the comments the selling agent put into the ARMLS, seen the ugly wallpaper, and heard what other REALTORS®, lenders, closing agents, and appraisers said about the comparable sale.

More ways to pick a home listing price

If you’re still having trouble picking out a listing price for your home, look at the current competition. Next, put your comparable sales into two piles: more expensive and less expensive. What makes your home more valuable than the cheaper comparable sales and less valuable than the pricier comparable sales?

Are foreclosures and short sales comparables?

If one or more of your comparable sales was a foreclosed home or a short sale, ask your real estate agent how to treat those comps. A distressed home such as foreclosed or short sale home is usually priced lower than those regular resale home. However, it’s very difficult to put a percentage or fix amount for the distressed properties. So you have to rely on your agent’s knowledge of the local market if to use a short sale or foreclosure as a comparable sale.

It’s your call!

Don’t just go with the agent who priced your home higher. Chances are such agent may not be able to deliver. You need to study the comparable information and ask your agent to be honest about your home and the other homes on the market. Then trust your own judgement.

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