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What Are Comps?

Do You Know What Are Comps?

comps?

Whether you’re buying or selling a home, comparing similar homes can yield a wealth of helpful information.

“Comps,” or comparable sales, is a term anyone on either side of a real estate transaction should know well. It refers to homes located in the same area and very similar in size, condition and features as the home you are trying to buy or sell.

Buyers look at comps when deciding what price to offer on a home, and sellers use them to figure out how to best price their home for the market. Real estate agents look at comps all day long as a way to keep on top of their local market. If you are a buyer or seller, it’s helpful to have a strategy to analyze comps, because all comps aren’t created equal.

Location is the highest priority

If you are trying to price a home or figure out its value, you need to look nearby. The market is based on location, so keeping as close to the subject property as possible — meaning, within the same neighborhood — is the most effective approach.

If you can’t get enough comps nearby, it’s fine to keep expanding out. But there will always be a boundary, like a school district, that you need to stay within.

Timeframe matters

The best comps are homes that are currently “pending.” Why? Because a pending home is a piece of live market data. A pending home means that a buyer and seller made a deal, and that deal will reflect the most up-to-the-minute stats on the market.

A good local real estate agent, leveraging her network, can get a fairly accurate idea what the ultimate sale price or range is for a pending deal. Try to stick with sales in the past three months, and never go more than six months, because older data is not reflective of the current market.

Factor in home features

Once you have location and timeframe, it is key to look for homes with similar features that have sold, as opposed to comparing price per square feet. While the latter is helpful, it won’t consider factors like views, a new designer kitchen or a finished basement vs. unfinished.

If you have all three bedrooms on the top floor, look for something similar. Try to compare your subject property to like properties when it comes to traits like total size, the number of bedrooms and bathrooms, and the size of the lot. You can make adjustments once you have found similar homes.

Don’t over-analyze the comps

Putting your trust in a good local agent will keep you from agonizing over the petty details of each comparable home. Your agent is likely familiar with some of the recent sales, and can help shed light on why one comp fares better than another. You may not know that one home was next to a fire station or across from a parking lot, or that another didn’t have a real backyard, but your agent will. These small nuances will affect the home’s value.

#RealEstate #RealEstateAgent #GoodLocalAgent #OuthouseSale # ComparableHome #GoldenFeather

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I've been in the mortgage and insurance business for over 27 years. In 1992, started a full service insurance agency with Personal Auto, Home, and Commercial insurance. I quickly incorporated the mortgage business into the agency to offer with insurance products. In 1997 took over the families construction business and took over the construction of several projects and quickly became very involved in the new home construction & remodeling business. At this point, we started offering mortgages along with our construction services. We were able to offer a complete package of services to our clients. In 1998, we decided that we were seeing too many families that were trying to buy a home, but couldn't qualify because of credit issues. After multiple failures with credit repair companies, both local and national, we decided to learn the credit repair business. We spent the next few years learning and experimenting with fixing credit for ourselves, friends, and family. After about a year of learning, we began offering our credit repair services for free to our credit challenged clients. We quickly learned that credit can be fixed and improved for these families, and incorporated our Credit Repair & Improvement Services. In 2003, I obtained my real estate license in order to help our mortgage clients looking to buy a home. We had been helping families get prepared and approved for a home loan, so it was only logical to offer them the remaining services as a real estate agent to find the home. This helped our retention and referral rates for many years. The clients liked the fact that I could answer all of their questions with every part of the process, but actually help and handle the entire process.

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