DIY comps: Be your own number cruncher (© Suzanne Plunkett/Bloomberg News/Getty Images)

If you're buying or selling a home, you're probably living and breathing "comps."

Shorthand for "comparable sales," these are the records of recently sold homes and pending sales that real-estate agents use to determine the sale value of similar properties. (Bing: What's a pending home sale?)

Until recently, it was difficult — certainly not practical — for most buyers or sellers to assemble their own comps because real-estate brokerages dominated access to real-estate records. But that has changed, with multiple-listing services now open to online brokerages.

"Their (the real-estate industry's) ability to control what you see is diminishing every day," says Glenn Kelman, CEO of the online broker Redfin. Now, records of property sales — records that are current enough to be useful — are increasingly found online, which means curious and determined buyers and sellers can dispel the mystery that once surrounded the pricing of real estate.

So, fine, you can do your own comps. But why would you want to?

  • You're selling property without an agent and need to figure out what the price should be.
  • You bravely want to investigate what the falling market has done to the value of your home.
  • You're buying and you want to be able to recognize a bargain and avoid overpaying.
  • You want to see for yourself how your real-estate agent arrives at her pricing advice.
What's your home worth?

Agents are ethically required to put their clients' interests first. But, occasionally, "the Realtor might give you the (comps) that are low, which is the (client's) biggest fear," says Duncan Hare, a broker with Synoia in Orange County, Calif.

By becoming knowledgeable, you can dispel the worry that your listing agent will show you inappropriately low comps in hopes of making a quick sale. Understanding comps also will help you get top dollar for your home while preventing you from asking too much and stalling the sale.

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Good comps and bad comps
Finding comps sounds simple: You just look at prices of sold homes, you'd think.

But just any old home sale won't do for a comp. The sales used must be recent, of homes similar to yours and near your home. You're unlikely to find a recent sale of a home that's identical to yours, so the idea is to come as close as you can, then adjust your price to account for the differences.

The three keys are:

  • Timing: To price your home, find transactions recent enough to provide a valid comparison. Unfortunately, "recent" is a squishy term. In a hot market when properties are turning over quickly and scarcity is driving up prices, recent may mean just two weeks ago. In many U.S. markets today, a comp from two months ago may not be useful because, even in a subdivision with identical houses, a home that sold for $500,000 might go for $440,000 today. In a stable market, comps from six months or nine months ago might work fine. Prices typically are higher in summer and lower in winter, when demand is typically lower. Prices also fluctuate in response to mortgage rates, local development, employment patterns and whether people are moving in or out of an area.
  • Proximity. A good comp is close enough to your home to share the attributes of the location. Try to stay within a mile or two of your home, Kelman says. But proximity also is determined by neighborhood boundaries. Homes in a neighborhood perceived as good sell for a premium. "Think about the neighborhood in terms of the quality of the homes and quality of the schools," Kelman says. Some other components: safety, noise, road quality, architecture, trees, landscaping, the upkeep of homes and infrastructure, sidewalks and proximity to parks, transportation, restaurants and shops. Even within a neighborhood, some locations command higher or lower prices. It takes deep knowledge of a neighborhood to correctly predict price premiums.
  • Similarity. For accurate comps, compare like with like. When pricing a condo, use condominiums and co-ops for comps. Likewise, screen out condos when pricing a single-family home. Choose comps that are the same size as your home, plus or minus one bedroom and/or plus or minus one bathroom, adjusting the price up or down to account for the differences, Kelman says. If your property is in a development, first look for comps within the development. Other points of comparison: quality of landscaping and construction, style, upkeep and condition. If you must use comps with dissimilar style, quality or condition, adjust your price.

A few warnings before you decide to DIY
Doing your own comps works best when prices are fairly stable, says Leslie Sellers, a Knoxville, Tenn., appraiser and past president of the Appraisal Institute. When prices are changing rapidly and are complicated by many factors, you're better off paying an appraiser, he says. "We have a complex market right now. The chances of a homeowner making a mistake by doing their own work are drastically increased in this market."

Read:  4 ways to turbocharge a home inspection

Professional appraisals cost roughly $300 to $500 and are done by appraisers who have earned a designation from the Appraisal Institute. Lenders accept only professional appraisals when loaning money on a home.

Also remember that an experienced, professional real-estate agent has been inside hundreds of local homes, has seen offers accepted, rejected and modified, and has listened to the responses of buyers to many, many homes, which gives them an advantage in finding the right price for a home. "You can have all the data you want, but learning how to analyze the data is where the magic is," says Gahlord Dewald, a technology and marketing consultant whose firm, Thoughtfaucet, helps real-estate agents with social media, search and Web strategy. (Find local agents through an Internet search or by searching the National Association of Realtors' site, Realtor.org.)