Sunday, November 23, 2014

Homebuyers MUST Use Five Best Comps to Value a Subject. Homequant Demonstrates!

In this example, the subject (a single family home) is located in North Las Vegas, with the following attributes: 20 year old and 1,400 SF of bldg area and 7,000 SF lot. 

Let's search for ten best comparable sales ("comps") within 1 mile radius of the town, but constraining all three variables - Land, Bldg and Age - to 15% range and time adjusting all incoming sales at 6% annual growth:

     (Click on the image to enlarge)

Five best comps based on closest distance are now chosen from the pool of ten comps:


Let's take a Spatial look into the comps pool as well as the final five (green):

Now, let's take a look at the Comps Grid to understand how to interpret the final value. While the most Probable Value is the Median Adjusted Sale Price (ASP), the 25th to 75th Percentile Range is the most Probable Value Range for a potential home buyer, although an aggressive investor might consider a lower value range, say up to the 25th Percentile, while a buyer bent on outbidding the competition might consider a more lax value range, say above the 75th Percentile.

Visit the Homequant site to learn how to value a subject using optimal selection criteria and adjustments, zeroing in on the final five, as well as the value parameters.

Other Related Posts:
Homebuyers MUST Demand to See the Comps, Spatially. Homequant Illustrates!

Homebuyers MUST Differentiate between Local Sales and Comps. Homequant Explains!

Homebuyers MUST Choose Least Adjustment over Distance or Sales Recency. Homequant Enlightens!

Three Sales from Three Prior Quarters – Unadjusted for Time - are NOT Comps. Homequant Describes!

Homebuyers MUST Verify Appraiser’s Values in Four Easy Steps. Homequant Reveals!

Homebuyers MUST Validate Home Values at Self-directed Sites. Homequant Pioneers!

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