In appraisal practice, what is a 'comparable' used for?

• A. A currently listed property for sale.
• B. A recently sold property with similar characteristics used to determine market value.
• C. A property with dissimilar characteristics used to determine market value.
• D. A property that has not sold.

Answer: (B)

In appraisal practice, a comparable is a recently sold property that is similar to the subject property and is used to determine market value. The sale price of that property serves as a real-world benchmark, reflecting what buyers actually paid under current market conditions. The appraiser then adjusts for differences in features, size, condition, and other factors so the comparison aligns with the subject’s characteristics, producing a value estimate that mirrors what the market would likely pay.

This approach is preferred over looking at currently listed properties or unsold properties because listing prices are not proven sale prices, and unsold properties provide no actual price data. Using a similar, recently sold property in the same area and time frame helps capture local market trends and more accurately reflect value.