In the context of property appraisals, what does a "comparable sale" refer to?

A "comparable sale" in the context of property appraisals refers to a similar property that has recently sold. In real estate valuation, appraisers rely on comparable sales, also known as "comps," to determine the market value of a property. These sales provide insight into the pricing trends in a specific area, helping appraisers establish a baseline that reflects what buyers are willing to pay for similar properties in terms of size, location, condition, and features.

Utilizing recent sales data from comparable properties allows appraisers to make informed assessments about the value of the subject property. For instance, if a similar home in the same neighborhood sold for a certain price, it can indicate what the subject property might be worth under similar conditions. This method is fundamental in ensuring valuations are accurate and reflective of the current market, which is essential for both buyers and lenders during real estate transactions.