The Comparable Sales approach compares a subject property with other similar properties that have been recently sold. After the comparison, you adjust the prices for each positive or negative feature of the property relative to the subject property and estimate the market value of the subject property from the adjusted sales prices of the other similar property
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How to do the comparison?
Find properties that appear similar to the property you are thinking of buying in terms of property size, age, features, conditions, quality of construction, room count and floor plan.
- Find out the cost per square feet of each unit and
- Use the present value and future value of the other competition units to bring it up to the current valuation. This step is particularly important if there are large gaps in the period they were transacted. A view on how to calculate the present and future value can be found here.
- Adjust for differences to determine the market value of the property you are looking to buy. Compare the features of the properties and add and minus as and when required and determined by you.
Here is a list of features that might or might not influence the value of the real estate property you are looking to buy and it’s highly dependable on the owner’s preference.
- Location of nearby good schools
- How close is it to nearby shopping centres
- How close is it to nearby MRTs
- How close is it to nearby Bus-stops
- Following URA’s Master Plan for the particular district you are planning to buy in
- Amenities outside of Condo
- Facilities inside of Condo
- Brands used for Condo Bathrooms, Kitchen and Bedrooms
- Maintenance Fees
- Too many units or too few units?
- Too near MRT Station for noise?
- Too near expressways causing Jams?
- Not near MRT Station
- Not near bus stops
If you are interested to know the value of your home with this method, let me know and get your reports from all of these property website within 24 hours.