Real Estate Comparables. One of the best assets to hold over the long term is real estate. While some investments like stock tend to appreciate over time, sometimes to a greater extent than real estate, real fixed assets can be a steady or risky and speculative investment, but tends to provide regular cash flow that can help to set up an individual financially for life. This is even true for homeowners who pay off a single family home and used proceeds from the sale of their home to finance their retirement.
To optimize your return on your real estate purchase one of the major decisions that you will make is when to buy real estate and what to pay for it. Likewise, knowing when to sell property and what time to charge for it can make or break the return that you earn on your sale. Real estate can be challenging to value and over paying for a purchase of real property can put you in a hold for a long time. Real estate Comparables will help to determine the fair market value of property and put you on the road to financial success.
What are Real Estate Comparables?
Real estate comparables or comps, are similar pieces of real estate that have sold recently and provide some insight into the fair value of the property that you are looking to buy or sell. Since real estate is a local phenomenon, real estate comps should be nearby and provide a glimpse into the local market. They should also be of similar properties with common features on them which illustrate the true value of the property that you are looking for.
Finding Real Estate Comps
Many people think it is simple to find similar properties to compare the property and they will simply look online for real property that looks like the one they are trying to compare to and take the price at its face value. This is an easy way to lose your shirt when investing in real estate.
There are often some subtle difference between properties that it requires an qualified real estate professional to identify and understand. While school districts and the presence of pools may be easy things for an amateur to spot, a real estate agent can spot the harder to compare items such as damage to property, zoning law variances, differences in town services in different neighborhoods, the presence of nearby parks, and the impact that quality buzz and hot stores or restaurants can have on a property, just to name several examples.
An quality real estate professional who knows the area and what is important to buyers or sellers in the area can help to guide you in not only spotting some of the differences in property noted above, but also in valuing them so that you can better know the market and place more effective bids and selling prices on the real estate that you are looking to buy or sell. In other words, a real estate professional is needed to properly compare apples to apples and oranges to oranges with comparable real estate property. Right now the most important Comparable you can have is a knowledgeable realtor that works the area you are trying to sell and buy into. Forget what the Comps say because it’s changing so fast. What the comps say today is going to be different tomorrow in this hot Phoenix Arizona real estate market right now, February 2021. Lots of great realtors out there so make sure you work with one. Thank you and if I can help you please let me know. Thank you. Angelo Call me anytime. 602 299-1743 or text or live chat anytime.