Comparable Sales (Comps)

Comparable sales - almost always shortened to comps - are the recent sale prices of similar, nearby properties, used to estimate what a given property is worth. The logic is that a willing buyer will pay roughly what equivalent properties have fetched. Appraisers, agents, and investors lean on comps as their primary check on price, especially for homes and small commercial assets.

A good comp is close on the factors that drive value: location (ideally the same neighborhood), property type, size, age, condition, and recency - most analysts prefer sales from the last 3-6 months because markets move. Since no two properties are identical, each comp is adjusted up or down for differences. If the subject property has an extra bedroom worth about $30,000 and a comp sold for $400,000 without it, the adjusted comp value is roughly $430,000.

A quick example: three nearby homes similar to the subject sold at $410,000, $425,000, and $440,000 in the past quarter. After adjusting for a smaller lot and a renovated kitchen, an appraiser might land on about $430,000 as the indicated value.

Comps pair naturally with the income approach. For a rental or commercial property, investors cross-check a comps-based figure against a cap rate valuation to see whether price and income tell the same story. Reviewing comps is a standard part of due diligence before committing capital, and for a tokenized property they help support the stated net asset value that backs each token.

The weakness of comps is thin data: in a unique property type or a slow market, there may be too few recent, truly similar sales to draw a confident conclusion, and stale or cherry-picked comps can mislead.

Source: Appraisal Institute (appraisalinstitute.org), as of 2026.