How Agents "Comp" Your Home For Sale...

Any real estate professional worth their pay will "comp" (compare) your home for sale to see what your immediate real estate market will bear for similar ones before coming up with an asking price suggestion for yours.

However, what makes another home a good "comp"?

A number of basic items must be in line with your home's features in order for the agent to utilize another home in your area as a "comp". These items are: same neighborhood, a similar street, the same school district, and similar lot and housing size and features. If all of these items align, then a "comp" can be used to suggest a current estimated value of your home. Using a home that is the same model in the same subdivision that sold just recently would be ideal of course. But this really happens only once in a while.

Most sellers really do not know how to locate and compare similar properties, which is one of the reasons why they hire an experienced agent. Good seller's agents take all of the work out of selling and marketing your home and they also give you solid and valid reasons to understand why you should be pricing your home at a specific price.

Naturally overall location, lot features, home size, upgrades, on site and nearby amenities, other extras and unique architectural details of the home all affect the listing price and how your home can be compared to "comps".

Taking a careful look at each of these items shows what people wanting to live in your area might be looking for when it comes to buying a home. For example, a higher sale price on a recently sold home that has an in-ground pool can indicate that this is an upscale family neighborhood and buyers put an increased value on such amenities. Your home may not have a pool but it might have other amenities along these lines: a tennis or basketball court, a dedicated gym, or a fantastic outdoor entertainment area.

Agents will always look at what makes your home stand out and what is similar to others in the neighborhood. They'll search for the best characteristics to showcase and then compare your home to others that have recently sold to see how yours stacks up from a buyer's perspective.

Reviewing the "comps" can also provide a lot of insights about sales trends in your neighborhood. Agents that work your neighborhood know what homes have sold when and for what price. They've been inside these homes and have seen their features and upgrades, or any flaws and drawbacks. They also know or can find out which homes were foreclosures or short sales.

Generally, many foreclosed homes are in very poor condition. However, many of the short sale properties can still be in good repair. Both of these types of sales usually occurred at discounted prices. So, if a "comp" is used from these sales categories, your agent must carefully cull out and evaluate the distinct differences that may or may not increase the value and therefore the listing price of your home.