sales comparison approach

3. The sales comparison approach (also known as the market approach or direct comparison approach) estimates the value of a property by comparing it to similar properties that have recently sold. This approach is widely used for residential properties and relies on market data and the principle of substitution, which states that a buyer would pay no more for a property than the cost of acquiring a similar property.

The sales comparison approach involves finding comparable properties in terms of location, size, condition, and other relevant features. The sales prices of these comparable properties are analyzed and adjusted to account for differences in features and characteristics. These adjusted prices are then used to estimate the value of the subject property.