Answer: This is where having a knowledgeable real estate agent pays off. A good agent will do their research on the “COMPS” in the area you are looking to buy in. “Comps” are comparable properties to the one you are buying or selling. We search the surrounding areas and neighborhood you are looking to purchase in and find a home as similar to yours as possible and see what they sold for , price per square foot, lot size, upgrades, etc.
This way you know you are making an educated offer and can use these comps in the negotiating process as well. The numbers don’t lie and this will help you see if the home you are purchasing is in line with the comps, over or under. We all love a deal so doing the research is so important.
This is similar to the process that an appraiser goes through to give your home an appraisal. When you buy a property and you finance it your bank will require an appraisal to make sure they can lend on it and that you (they) are not paying more than the home is worth.
Caroline Dargan Johnson