Source: Ris Media —
How much is a house worth? Knowing the value of a home can be crucial when buying or selling.
The location and market trends will be very important, but they aren’t everything. What decides how much your house is worth are the real estate “comps.”
What is a comp in real estate?
A real estate comp is industry lingo for a comparable home to the property you want to buy or sell. Comparable homes are similar properties sold in the same area recently. The idea is to find properties as similar as possible to the one you are looking at to give the best indication of the value.
Who uses real estate comps?
Comparables are very useful to professionals in the real estate business, along with people buying and selling homes. This information can prove invaluable when making decisions and negotiating on a home.
Let’s look at who benefits from real estate comps:
Homebuyers
When you want to make an offer on a home, real estate comparables can help you see if the listing price is reasonable. It could show that a lower offer might work if the home is priced higher than the comps.
Home sellers
When pricing your home, comps will give you an idea of what to list it for. They can also show you the key selling points for buyers looking for homes similar to yours.
Real estate agents
Both buyer’s agents and seller’s agents use comps as a regular part of the services they provide their respective clients.
Agents will use data from the multiple listing service (MLS) to find comps. They use this to compile a comparative market analysis to advise their clients when buying or selling a home.
;
