Real Estate “Comps”: What Are They and Why Do They Matter?

If you’ve been around real estate at all, you’ve probably heard the term “comp”—but what does it actually mean?

A “comp,” short for comparable sale, is a recently sold property with characteristics similar to the home being evaluated. Agents look for homes in the same neighborhood or area with comparable square footage, bedrooms and bathrooms, property type, age, condition, lot size, garage space, upgrades, and other important features. How recently the property sold also matters, especially in a changing market. In short, it's comparing apples to apples, not apples to oranges.

Appraisers also use comparable sales to develop an opinion of a home’s market value. They compare the property to similar recently sold homes and account for meaningful differences—such as size, condition, location, acreage, garages, and upgrades. These adjustments help determine whether the agreed-upon purchase price is supported by the local market.

Comps show what buyers have actually paid—not simply what sellers are asking. They help sellers price their homes, guide buyers toward competitive offers, and help lenders determine whether the home’s value supports the amount being financed.

Learn more about how comps are used in real estate:https://blog.remax.com/how-to-use-comps-to-make-a-competitive-offer-without-overpaying/