This tool facilitates the comparison of a subject property with comparable properties by systematically accounting for differences in features like square footage, lot size, age, condition, and location. For example, if the subject property has a smaller lot than a comparable sale, the sale price of the comparable might be reduced to reflect this difference. This process helps arrive at a more accurate estimate of the subject property’s market value.
Systematic adjustments provide transparency and defensibility to valuation analyses. By quantifying the impact of differences between properties, this analytical approach strengthens the credibility of appraisal reports. Historically, adjustments were calculated manually, but advancements in technology have streamlined the process, leading to greater efficiency and accuracy in valuation. This structured methodology is essential for mortgage lending, real estate transactions, and property tax assessments.
