Determining the right price for a home can feel like a guessing game, but real estate comps—comparable home sales in your area—can help take the mystery out of it. Whether you’re looking to sell and want to set a competitive price or buying and aiming to make a strong offer, knowing what similar homes are selling for is crucial. Before you list your San Diego home for sale or purchase that Miami house, read this Redfin article on how to find real estate comps in your area.
Understanding Real Estate Comps
Real estate comps, also known as “closed comparable sales,” are recently sold homes in a specific area that share similar characteristics with the home you’re selling or considering buying.
It’s important to note that home values can vary by location. For instance, a home in Houston, TX will have a different listing price than an identical home listed in Sacramento, CA. Local market conditions play a significant role in determining the value of homes, even if they are identical.
Factors Influencing Real Estate Comps
In order to be considered a comparable property, a property should ideally match your house in:
Location
Location is key. Property values can vary within the same neighborhood or even within a short distance. Start by looking for comps within a 1-mile radius and expand to 5 miles if needed. Expert knowledge or the assistance of a real estate agent can help you navigate the nuances of a neighborhood.
Neighborhood
Real estate comps should share the same neighborhood features such as proximity to schools, shops, hospitals, waterfronts, parks, and views. Accessibility to public transportation and walkability should also be considered.
Year Built
Homes built within a 5-year range of your property’s construction should be considered. While older homes may require more maintenance and updates, newer homes typically have a higher fair market value.
Home Size
Square footage plays a crucial role in comparing home values. The size of the home will impact its price, with larger homes typically costing more. Look for properties that are similar in size to yours when analyzing real estate comps.
Layout
Homes with unconventional layouts or divided into smaller rooms may have lower values. The layout of a home can affect its selling price.
Price per Square Foot
Calculating the price per square foot can provide a useful comparison between properties. Divide the sale price by the square footage to determine the price per square foot.
Number of Bedrooms and Bathrooms
The value of a home typically increases with more bedrooms and bathrooms. These factors can influence the sales price and the selection of higher comps.
Condition
The condition of a home can impact its selling price. Properties in need of significant repairs or upgrades may sell for less, but it’s important to look beyond the surface and understand the factors affecting the sales price.
Upgrades and Renovations
Upgrading a bathroom or renovating a kitchen can increase a home’s value. Compare any renovations or upgrades in real estate comps to evaluate how they impact your home’s value.
Timeframe of Sales
Focus on homes sold within a 3- to 6-month period for accurate comparisons. In a competitive market, consider a shorter timeframe to assess the most recent sales data.
5 Ways to Find Real Estate Comps in Your Area
When searching for local comps, aim to find at least three similar properties to ensure accurate comparisons. Here are five simple ways to locate real estate comps.
1. Utilize a Real Estate Website
Real estate listing websites like Redfin offer easy access to recent home sales in your area.
How to Find Comps on Redfin:
- Search by address to view public sale information, including the last sold price.
- Scroll down on the listing page to find nearby recently sold homes.
- Click “View More Recently Sold Homes” for a comprehensive map of recent sales.
Refining Your Search:
Use filters to narrow down results based on:
- Listing status: Set to “Sold” to exclude active listings.
- Timeframe: Start with one month and expand to 3-6 months if necessary.
- Property details: Match bedrooms, bathrooms, square footage, lot size, year built, and HOA fees to your property.
- Special features: Consider amenities like waterfront views or recent upgrades.
Recent data offers valuable insights into fair market value, helping you set a competitive price whether you’re buying or selling. While this method may not account for property condition or renovations, it serves as a solid starting point.
2. Use an Online Home Valuation Tool
An online home valuation tool is another useful resource for finding real estate comps and determining your home’s worth. Redfin provides various options to access an online home valuation based on complete MLS data of recent sales in your area.
- Instant home-value estimate and free home report: Get a quick estimate of your home’s value and see comparable properties in your area.
- Professional estimate by a Redfin Agent: Receive a comprehensive property estimate prepared by a knowledgeable Redfin agent within an hour.
*These estimates are not appraisals and do not replace the services of a professional, licensed appraiser.
3. Consult Your Real Estate Agent for MLS Comps
For accurate real estate comps, consider working with a local real estate agent. Agents have access to the MLS, the most up-to-date and reliable tool for obtaining real estate data.
Real estate agents regularly use MLS comps to provide clients with a realistic price range when listing a home for sale. They can assess market trends, property values, and pricing strategies to ensure your property is competitively priced.
4. Research Public Property Records
Public property records from your county can be a valuable resource for buyers and sellers. While these records may only show the last recorded sales price, they offer insights into property values. However, additional research is recommended for accurate data.
Most counties provide online access to property records, allowing you to search for information such as the last sold price and current taxes based on the property address.
*This is not a substitute for a professional appraisal and the services of a licensed appraiser.
5. Explore Real Estate Auctions and Foreclosure Sales
Auction and foreclosure sales can provide additional pricing data, especially in areas with limited recent sales. While these sales may have lower prices due to their nature, they offer valuable insights when compared to traditional comps.
How to Find Auction and Foreclosure Comps:
- Search foreclosure listings on platforms like Redfin.
- Check government resources such as the HUD home store or county websites for foreclosure sales.
- Attend local real estate auctions to observe prices of distressed properties.
While foreclosure and auction sales may offer lower prices, they can still serve as valuable data points. Consider factors such as property condition, repair needs, and selling circumstances when using these as comps.
Users of Real Estate Comps
Real estate comps are beneficial for various individuals involved in real estate transactions. Here’s how different parties can benefit from utilizing real estate comps:
Real Estate Agents and Brokers
Agents and brokers rely on real estate comps to provide accurate pricing recommendations and adjust strategies based on market conditions.
Home Sellers
Sellers use comps to determine competitive list prices and highlight selling points of their property in listings.
Homebuyers
Buyers use real estate comps to evaluate listing prices, negotiate offers, and make informed decisions during the home buying process.
Home Appraisers
Appraisers utilize comps to estimate fair market value by comparing similar properties in the area, ensuring accurate property valuations for mortgage approvals.
FAQs About Finding Real Estate Comps
1. What Makes a Property a Good Comp?
A good comp should share similar characteristics with your property, including location, square footage, bedrooms, bathrooms, year built, property type, and recent sale date.