Home Values - Ways TO Get Comparable Sales Analysis by Duncan Wierman

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Home Values - Ways TO Get Comparable Sales Analysis
by Duncan Wierman

WAYS TO GET COMPARABLE SALES ANALYSIS

There are primarily four ways to get information on comparable sales ( comps. cma's ) when trying to determine the value of a target property.
Those four are:
1. Doing Your Own Research. There are four subcategories.
Those are: a) Courthouse Searches
b) Newspaper Listings
c) Tax Appraisal Districts
d) Master the Neighborhood Courthouse Searches

2. Internet Searches
3. Service Companies
4. Access to MLS DOING YOUR OWN RESEARCH Within this category,

If you live in a state that is discloses property sales information, you will have a much easier time than those of us who live in a non-disclosure state, like Texas. My understanding for disclosure states is that information on sales can be found at the courthouse if you're willing to spend the necessary time.

From that information you could devise your own methodology for determining comps.

Certainly, it would be beneficial to know the history of a target property which you can look up while you're there,
but I think this would be very slow and probably not worth your efforts if the only goal is to get comparable sales data.
Newspaper Listings In some states the sales information is listed in the local newspapers so you could get a feel that way or create your own database and update it periodically. Again, I think this is a slow way to get things done, but it may prove useful to you in some circumstances. Tax Appraisal Districts
In my area, the tax assessed values provided by the tax appraisal districts are frequently useless.
You ' ll have to get a feel for this in your area as you may find that the assessed values are close in many neighborhoods.
Master the Neighborhood. Probably the most accurate way is to spend the necessary time to master your farm areas.
By this I mean learning the values for certain neighborhoods that you target.

You can speak with Realtors, attend open houses, view as many floorplans as possible, etc. until you can drive by a house at 30 mph and know within a reasonable range what the property will be worth in good condition.

This information comes in extremely handy when talking to sellers on the phone.
If a seller calls you and tells you the house is in ABC subdivision, it ' s a three bedroom, two bath, two car garage house and it ' s 1, 500 square feet, it ' s nice to immediately know the market value in your head.

INTERNET SEARCHES I know some investors use online searches to determine value.

I tried this when I first started and found the information to be outdated and not even close to what I consider a comp. For example, at the time the Austin, Texas market was appreciating almost one percent per month. Retrieving sales numbers that were almost a year old and five miles away from my target property was useless.

If you ' re in a disclosure state, this methodology may prove more helpful. I haven't used or even looked at any of these sites for this purpose in years, but here's an initial list you could view, although keep in mind that some of these may be regional - specific.
www.Realtor.com,
www.homeradar.com
www.Homegain.com,
www.Yahoo.com
www.Domania.com

I'm sure you can find many more sites like these if you'll spend the time to do so.

SERVICE COMPANIES
Some investors subscribe to services that provide sales information. This can be in the form of software in the form of CD ' s that are sent out periodically or it could be an online service where you login to retrieve information. I ' ve never used any of these services and typically, the reviews are mixed as to their usefulness. Again, that may come down to whether or not your state discloses sales information.
Here's a list for you to check out:
First American Real Estate Solutions ( www.firstamres.com )
Dataquick ( www. dataquick. com )
Netronline ( www. netronline. com )
CD-Data ( California only - www.cd-data.com )

ACCESS TO MLS
Having access to Realtor's proprietary information that is available in the Multiple Listing Service ( MLS ) is invaluable.
In my opinion you should begin working toward this goal regardless of which comp methodology you plan to use or currently use.
Again, there are several ways to accomplish this goal:
Ask or Hire Someone to Help
Become a Realtor?
Obtain an Associate Membership?
Relationship Access - Ask or Hire Someone to Help One way to obtain information on sales is to contact those who have access to it. For example, you could get in touch with a Realtor, Appraiser, or Title Company and establish a relationship. At some point fairly early on you ' ll have to make it worthwhile for these folks to continue helping you, so it's important to either pay them for their assistance or to get some deals done where they get paid. If you're going to go this route, I think it's extremely important to have the actual data sheets sent to you so that you can begin to learn how to evaluate values.

You'll soon discover that no one runs comps like you do. After all, a comp is merely someone's opinion of what a property is worth.
I've had Realtors provide alleged comps on properties that were in different subdivisions miles away, fifty years older than my target property, with a different number of bedrooms and baths, different foundation structures, sold years prior, etc. Do you really want to trust six figure decisions to someone else ' s judgment? Become a Realtor. Although I frequently see disparaging comments about Realtors and the liability associated with becoming one, I think this line of thinking is way overblown. I can promise you that if you ' re in real estate long enough; you're going to end up a target for someone.
Whether or not you happen to have a real estate license is probably irrelevant. Then there's the theory that you're held to a higher standard if you're licensed. Again, who cares? You're not going to operate your business to at least the standards that Realtors are held to? No, I'm not licensed and I go back and forth on whether or not I should be, but my decision, or lack of one, is based on costs versus benefits and being lazy. I've never met a successful investor who also happened to be licensed who told me not to get my license. It's seems to be only the folks who aren't licensed who warn me of the

Author's Biography:

Real Estate Investor Information from A Full time Investor

Posted on: November 5,2006

Email: dwierman@gmail.com
Website: http://www.duncanwierman.com