Before you make an offer on a home, you need to know one thing above everything else: what is this property actually worth? The answer doesn’t come from the listing price, the seller’s emotions, or what the neighbours say. It comes from comparable sales — also called “comps” — and knowing how to analyze them correctly is the difference between paying a fair price and overpaying by tens of thousands of dollars.

Real estate agents do this analysis every day. But as a buyer or seller, understanding the process yourself gives you a major advantage at the negotiating table. Here’s how to analyze comparable sales like a pro.

What Are Comparable Sales (Comps)?

Comparable sales are recently sold properties that are similar to the home you’re evaluating. They form the foundation of a Comparative Market Analysis (CMA), which is the tool real estate agents and appraisers use to determine a property’s fair market value.

The goal is to find homes that are as close as possible to your subject property — in size, age, condition, location, and features — and use their sale prices to estimate what your target home is worth today.

Step 1: Define Your Search Parameters

The first step is setting the right filters. Professionals typically use the following criteria when pulling comps:

Location radius: Start within a 0.5 to 1 km radius of the subject property. In urban markets where inventory is dense, you may narrow this further. In rural or suburban areas, you may need to expand it — but always prioritize proximity.

Time frame: Use sales from the past 90 days as your primary window. In fast-moving markets, stick to the last 30–60 days. Sales older than six months may reflect market conditions that no longer apply.

Property type: Match like with like. Detached homes should be compared to detached homes. Condos to condos. Townhouses to townhouses. Mixing property types distorts the analysis.

Size: Aim for comparable square footage within a 10–15% range. A 1,200 sq ft bungalow is not a reliable comp for a 2,200 sq ft two-storey home.

Step 2: Gather the Right Data Points

Once you’ve identified potential comps, you need to collect the right information for each one. Here’s what matters:

• Sale price vs. list price: Did it sell above, at, or below asking? This reveals market competitiveness.
• Days on market (DOM): How long did it take to sell? A home that sat for 90 days tells a different story than one that sold in 48 hours.
• Price per square foot: This is your primary normalization tool when comparing homes of different sizes.
• Bedrooms and bathrooms: Adjust for differences — an extra bathroom typically adds $10,000–$25,000 in value depending on the market.
• Lot size: For detached homes, land value matters. A larger lot commands a premium.
• Basement: Finished vs. unfinished basements represent significant value differences — often $20,000–$50,000 or more.
• Parking: Garage vs. driveway vs. street parking affects value, especially in urban areas.

Step 3: Make Adjustments for Differences

No two homes are identical, which is why adjustments are the most nuanced part of comp analysis. The principle is simple: if a comp has something the subject property doesn’t, subtract value. If the subject property has something the comp doesn’t, add value.

For example: A comparable sold for $850,000 but had a finished basement, while your subject property doesn’t. If a finished basement in that area is worth approximately $30,000, you’d adjust the comp down to $820,000 as a more accurate reflection of what the subject property would have sold for.

Common adjustment categories include: number of bathrooms, kitchen renovation quality, flooring, windows (updated vs. original), HVAC age, parking, outdoor space (deck, pool, landscaping), and view or exposure.

Step 4: Calculate Price Per Square Foot

Price per square foot (PPSF) is one of the most reliable tools for quick comp analysis, especially for condos and townhouses. To calculate it, simply divide the sale price by the total finished square footage.

If three comparable condos sold at $650, $670, and $685 per square foot, your subject property’s estimated value sits in that range. Multiply the PPSF average by your subject property’s square footage for a ballpark market value.

Be aware: PPSF is less reliable for detached homes where lot size, basement finish, and unique features create bigger variations. Use it as one data point, not the only one.

Step 5: Weight Your Comps by Relevance

Not all comps carry equal weight. Prioritize them in this order:

Tier 1 (most relevant): Same street or block, sold within 30 days, nearly identical size and features. These are gold.

Tier 2 (solid reference): Same neighbourhood, sold within 60–90 days, similar size with minor differences that can be adjusted for.

Tier 3 (directional only): Same general area but different street type, older sales, or requires significant adjustments. Use these to identify market trends, not to pin a number.

Aim to have at least three solid Tier 1 or Tier 2 comps before forming a value opinion. If you only have Tier 3 comps, acknowledge the uncertainty in your analysis.

Step 6: Account for Market Conditions and Trends

Real estate markets move. A comp from four months ago may not reflect today’s prices, especially in a market that’s been rising or cooling. To account for this, professionals apply a market condition adjustment — often called a “time adjustment.”

If homes in the area have been appreciating at roughly 1% per month and your best comp sold 60 days ago, you might apply a 2% upward adjustment to reflect current conditions. In a declining market, the adjustment goes the other direction.

Track active listings, pending sales, and the average list-to-sale price ratio in the neighbourhood. A ratio consistently above 100% signals a competitive seller’s market. Below 97% suggests buyers have negotiating room.

Step 7: Identify the Value Range — Not Just a Single Number

Professional appraisers rarely land on a single price — they identify a supportable range. You should do the same. After adjusting and weighting your comps, you’ll typically find a value range of perhaps $820,000 to $865,000.

Where within that range does the subject property fall? Consider its overall condition, motivation of the seller, uniqueness of features, and current competition on the market. A well-maintained home with a recently renovated kitchen and low competition should sit toward the top of the range.

Common Mistakes Buyers Make When Looking at Comps

Using active listings as comps. Active listings are asking prices — they are not comps. A home listed at $950,000 may ultimately sell for $890,000. Only sold data reflects actual market value.

Ignoring condition differences. Two homes can be the same size on the same street but sell for $80,000 apart due to renovation quality. Never skip the condition adjustment.

Using too few comps. One or two sales are not statistically meaningful. Always aim for a minimum of three strong comps before drawing conclusions.

Ignoring the trend direction. Looking at where prices were six months ago without accounting for where they’re going today can lead to significant mispricing in either direction.

How to Access Comp Data

As a buyer or seller, your best source of accurate comp data is your real estate agent, who has access to the MLS (Multiple Listing Service) — the most comprehensive database of sold properties. Ask your agent for a formal CMA before listing your home or making an offer.

Public tools like Zillow, Realtor.ca, and Zolo provide some sold data, but they’re often delayed, incomplete, or missing key details. Use them to get oriented, but rely on your agent’s MLS access for precision.

The Bottom Line

Analyzing comparable sales isn’t just a skill for agents and appraisers — it’s a superpower for any buyer or seller who wants to make confident, data-driven decisions. When you know how to read comps, you know whether a price is fair, whether you have room to negotiate, and whether the home you love is actually worth what they’re asking.

At Team Rajpal, we run a thorough CMA for every client before they make a move — so you always know what a home is truly worth. Contact us today to get started with your personalized market analysis.

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