What is the primary focus of the sales comparison approach in property appraisal?

The primary focus of the sales comparison approach in property appraisal is to analyze and compare comparable property sales to determine the value of the subject property. This method relies on the premise that the value of real estate can be best assessed based on transaction prices of similar properties that have been sold in the same or a similar market, allowing for adjustments based on differences in features, conditions, and locations.

When appraisers utilize this approach, they gather data on properties that are comparable to the subject property in terms of size, location, and amenities. By evaluating these comparable sales, adjustments can be made for any variances that might impact value—such as differences in square footage, number of bedrooms or bathrooms, and overall condition. This comparative framework helps ensure that the property is appraised in alignment with current market conditions and buyer expectations.

Other methods mentioned, such as assessing construction costs or income potential, are significant in their own contexts but do not directly define the sales comparison approach, which is distinctly grounded in market activity and similar property sales.