Curious about the going rate for properties in your area so you can nail down a competitive list price? Well, it’s a lot easier to find that information now than it was 15 years ago.
Once upon a time, the only place you could get that coveted property data was the MLS (multiple listing service), a series of private databases real estate professionals use to share listing information among one another and broker deals.
Today, that’s changed… all you need is a Wi-Fi connection to dig up specs like square footage, bedroom count, and selling prices on nearly any house across the country.
While you no longer have to be an agent or home appraiser to find comparable sales, aka “comps” for your own house, it’s still a tricky business. Don’t expect to run some simple math—comp A + comp B + comp C, divided by three to get your list price.
Follow this “how to find comps for my house” crash course to do your homework on comparable sales, then decide if you’d like to go it alone or enlist the help of a pro.
First of all, what are ‘comps’?
In real estate, the term “comps” refers to recently sold homes similar to your own house across a number of key criteria.
Comps help you price your home accurately by giving you a range for its “fair market value,” which you can then add or subtract from based on your home’s unique characteristics and features.
To be considered a comp, a property ideally matches your house in:
- Location, location, location
- Size (square footage, inside and out)
- Number of beds and baths
- Year built (within a 5-year range)
- Upgrades and finishes
Once you’ve assembled your pool of similar properties, you want to take note of their sold price. Active listings are not an accurate comparison point for your home’s value.
Think about it…If the home down the street is listed for $500,000—that’s great, but it hasn’t sold yet, so how do you know if it’s too high or too low?
Comps that have sold within the last 60 days are most preferable because they reflect current market conditions. However, recent sales aren’t always available, so you may have to pull comps from as long as six to 12 months ago.
Why do you need comps to price your home?
Comps aren’t just one of those “nice to have” elements of your pricing strategy. They’re a benchmark that will come into play at multiple points in the transaction.
Once you get to escrow, a home appraiser will assess your home’s value on behalf of the mortgage lender financing the home—using a comps analysis of their own.
If the appraiser finds that the home’s fair market value is less than the price the buyers agreed to pay, the buyers can negotiate the price down or back out of the sale.
“What is an appraiser going to see when he appraises this house?” asks top agent Collier Swecker, an investment properties specialist endorsed by Dave Ramsey and Glenn Beck.
“The listing price needs to stay within earshot of the appraisal because the methodology will be the same federal government guidelines that the buyer’s appraiser will use down the line.”
In other words, if you didn’t use the right comps to set the list price, your home may appraise for less than the accepted offer. If that’s the case, then the lender may not approve the buyer’s loan and your sale could fall through.
When pulling comps, three is the minimum number you need. However it’s a safer bet to gather six of the most recent, similar comps that are closest to you.
“Different loan types have different guidelines and criteria that the appraiser must meet,” says Swecker. “For example, the appraiser may have to find three comps for a VA loan, but for an FHA loan six comps may be needed within a half mile.”
How to find your own comps on the top real estate listing websites
Back in the day, you needed a secure login to access property data from the MLS.
Nowadays it’s a lot easier to gather data about homes on the market in your area, thanks to the internet and numerous online real estate listing sites.
These sites pull non-proprietary information from the MLS into searchable databases that let you filter listings by specifics that match your own home. This includes details like, location, number of bath and bedrooms, lot size, and home type.
Most importantly, the majority of these sites allow you to filter out all but sold properties.
Here’s a list of places to start your search for comps:
Start your search for comps on Zillow by typing your city and state into the search bar.
Filter for “Recently Solds” so you’re only seeing the yellow dots.
Zoom in on your area, then your neighborhood, and finally your house to use as a reference point. Assemble comps in closest proximity to your own location that match your home’s characteristics.
Pro tip: For faster comp assembly, hover over a Recently Sold listing with your mouse to see the number of beds and baths without having to click through.
Pro tip: Trulia’s profile of your home’s address offers up a list of comparable sales already curated for you based on:
- Distance to your home
- Property Type
- Sold Price
- Sold Date
- Square footage
Realtor provides a search portal of “Just Sold” properties. Enter your city and state and start browsing from there.
Pro tip: Assembling comps through Realtor requires a bit more legwork as you can’t zoom in on a map or by ZIP code/neighborhood to narrow down the “Just Sold” listing pool in your city. As you can see in the screenshot below, a search for “Just Solds” in Wheaton, IL, serves up 576 results alone. But you can filter by:
- Property type (house/condo/farm ranch/land)
- Home size
- Lot size
- Home age
Search your city on Redfin’s “Find a Home” portal. Then filter for “Listing Status” and turn the “For Sale” toggle to “Off” and the Sold toggle to “On.” Use the blue listings to find comps for your house.
Pro Tip: Redfin lets you narrow down your “Sold” listings by time frame—so you can search for listings that sold last week, all the way up to listings that sold in the last 3 years. For the purposes of finding comps, remember that the more recent, the better.
Here’s what these online-sourced comps might be missing
Before you set out on your DIY comps adventure, note that the information displayed on the web can’t be taken 100% at face value. Data integrity and context can be an issue when you start collecting information on comparable sales on the web.
Here we’ll go through the most common issues you may run into.
Inaccurate “sold” prices.
The majority of the details found in online “sold” listings are correct, such as square footage, number of rooms, and the listing prices.
It’s the sold prices—the most important data you’ll need from your comps—that’s not guaranteed to be complete or correct.
For starters, on some of these sites—including Zillow and Trulia— anyone can create listings directly on the site, kind of like Wikipedia.
Plus, for agents, these sites are largely used as marketing tools. They’re useful for providing the photos, descriptions, and details on their available listings directly to buyers house shopping online.
Once a home sells, updating that data in the marketing materials isn’t a top priority.
Swecker advises, “There’s a large percentage of Realtors that do not give their sold data to the online sites because it has to be manually entered.” So even when a listing is marked as “sold” on these sites, the dollar amount given may still be the list price, not the sold price.
The sold price also may fail to reflect any seller concessions, or money the sellers had to pay to repair the garage, replace the carpet, or cover the buyer’s fees at closing.
Outdated, incomplete listing information.
Keep in mind that online real estate listing sites pull their property data from the MLS. This means that only the MLS will have the most up-to-date data, and not every listing portal will have complete location coverage.
Listings missing from the MLS.
There may be some nearby home sales that won’t show up on these online sites at all, because they were never entered into the MLS in the first place.
Known as pocket listings, these are private listings that agents sell for their clients within their own private network of buyers. Even if they aren’t in the MLS, the sold prices on these pocket listings can impact your home’s current market value.
Recent property upgrades not mentioned online.
Say a homeowner sold their house for $350,000, but right before they listed it, they added an extra bathroom or remodeled the kitchen. It’s possible those property details didn’t get updated on the online listing sites.
Not realizing this, you may mistakenly group a property into your comps pool without realizing it’s actually off in bathroom count, or without adjusting your list price for the upgraded kitchen.
So, now that you know how tricky it is to find comps, the truth is…that’s actually the easy part. The hard part comes once it’s time to analyze the data they provide.
What goes into a comps analysis?
Setting your price isn’t as simple as listing at the average sold price of your available comps. In some cases you’re better off listing at less than the average comps—in other cases you’re safe to list for thousands more than the most recently sold home.
So how do you figure it all out?
The truth is, analyzing real estate comps is both a science and an art.
It starts with the science when you begin comparing the statistics—not just the sold price, but data like the lot size, square footage, and the number of rooms.
The distance between your house and the comps plays a role, too—but that stat is a little more murky, because neighborhoods can shift dramatically, even in the span of a mile.
Then, of course, there’s the fact that all homes are unique. Let’s take two comps that have the same lot size as your home. However, one has a smaller footprint because it has a second story, and the second has a bit more square footage due to a bonus room, but a smaller backyard.
Which one has more “value?”
That’s where the art comes in. In some areas, two-story homes are desirable because it means they’ll have a bigger backyard. In other areas, slightly larger, single-story homes are worth more because stairs limit accessibility.
This also holds true for upgrades and finishes.
It’s safe to say that a home with marble countertops is likely worth more than one with laminate countertops. But do those marble countertops make it more valuable than one with granite, quartz, or butcher block countertops?
But what if those marble countertops are installed in a small, affordable house?
A buyer in the market for a budget home is unlikely to fork over a few thousand more for expensive finishes. So those expensive countertops are unlikely to add value to that starter home—and may even decrease the value if, for example, the luxury upgrade increases the insurance costs.
Remodels, upgrades, and bonus features aren’t all equal. Their added value to a home can change, and not only based on age (how long it’s been in the home), or type. Their perceived value can shift based on what buyers are looking for.
For example, in some real estate markets buyers are clamoring for granite countertops—but in other areas, engineered quartz is all the rage.
Online resources can give you a picture of national real estate market trends, but to get a picture of the local market, you’ll need to do some legwork.
A great place to start is by touring local open houses to chat up a series of local real estate agents about current market trends in home features. Then you can make your valuation assessments based off of what you learn.
When in doubt, talk to a real estate agent about finding comps for your house
Real estate agents have direct access to the most accurate comps data in the MLS. They also have years of experience spent studying shifts in local market trends, since after all, their livelihood depends on that knowledge.
Agents won’t just pull the comps for you, they’ll compile and analyze the data in a report known as a comparative market analysis (CMA).
Real estate agencies have developed sophisticated digital tools to compile their CMAs. These tools comb through and rate all of the data pulled from the best comps to give you the clearest picture of your home’s current market value.
Then they further finesse those numbers provided by the CMA with their own personal knowledge of buyer trends and market swings.
After that, they’ll contact their network of brokers and bankers who can give them an idea (if not the hard numbers) on currently pending sales.
And the beauty of all of this is: you don’t have to hire an agent to get a CMA. Agents will pull comps and put together a CMA for free to bring to the introductory meeting as part of their sales pitch.
For example, if you use HomeLight, you’ll get multiple referrals to top agents with track records of successful home sales in your specific neighborhood. You’re then free to interview as many as you wish.
Each will bring a CMA and give you their personal, expert analysis of the data. You’re then free to make your decision on hiring one of the agents.
Going with an agent is the smart play because the real estate market is fluid and ever-changing. When you go it alone, you’re solely responsible to keep on top of new comps throughout the entire sales process.
For instance, let’s say a pending sale closes two days before you’re set to list your home. The list price will need to be adjusted accordingly—if you’ve spotted the closed sale in time.
You’ll even need to keep an eye on pending and recently closed sales after you’ve accepted an offer, too. Otherwise, a nearby home that’s just sold for less than yours can tank your appraisal.
If you’ve hired a top-tier agent, you’ve got an advocate who’ll be keeping on top of new comps from before your home is listed until the closing documents are signed, sealed and delivered.
Finding and analyzing comps to nail down the right list price is tricky business for any homeowner to tackle alone—but it can be done. Thankfully, there are plenty of expert agents around who are willing and able to do the work for you.