Setting the right asking price has always been a big challenge in selling a home. It’s even tougher in the current market, with inventory, buyer demand and sales activity varying widely between neighborhoods. A real estate agent can help by factoring relevant data into your home price. A primary tool for finding that data is a comparative market analysis, aka real estate comparables or comps.
Competitive pricing is one of the top reasons sellers list for working with a real estate agent, reports the National Association of REALTORS® 2025 Profile of Home Buyers and Sellers. And home comps are key to competitive pricing.
What Are Comps?
An agent uses a comparative market analysis to inform an estimate of your home’s market value by examining similar properties that have recently sold, along with homes currently on the market and pending sales. The CMA evaluates homes in a specific area that have many characteristics of the home being analyzed. The properties would likely have comparable lot sizes and square footage and the same number of bedrooms and bathrooms. Other criteria would be the age and condition of the properties, improvements made and special features such as covered patios.
“Comps are the homes that are active and have sold in the past three to six months,” said Kati Spaniak, a licensed real estate broker with eXp Realty in Northbrook, Ill. “You can look at comps further out than that. However, to best understand the market at that moment, the agent should only be looking at the last three to six months.”
Agents primarily gather that information from the Multiple Listing Service, or MLS, which provides detailed information about closed sales, listing history and property characteristics.
Finding the Right Homes for Real Estate Comparables
Sellers often focus on what a neighbor’s home sold for, but agents look much deeper than proximity. Other important factors are the condition, style, size and age of the home. Agents also consider recent updates and lot size, says Melissa D. Rubenstein, a real estate agent with Corcoran Infinity Properties in Wyckoff, N.J.
Agents can help sellers understand real estate terms and nuances based on each player in the transaction. For example, sellers may not know the difference between the appraisal price and the sales price. The appraisal price is the most probable price a market will bring, says Keisha Wilkinson, NAR senior policy representative, valuation. “Appraisers use market value for residential mortgage appraisals. The sales price for a property can vary widely. One buyer may be willing to pay more for a property because of their individual motivations.”
Rubenstein also considers how buyers are responding by examining the relationship between a home’s list price and final sales price. “Did the home sell for around list price, or was there a big decrease or a bidding war that drove up the price? That gives us an indication of what pricing strategy is driving the market in that area.”
Challenges with Today’s Real Estate Comparables
Changing market conditions can complicate finding ideal comparables. With fewer homes selling in many markets than during the pandemic boom, agents sometimes have to adjust how they conduct their analysis.
“In my market, we are seeing 50% fewer sales than during the prepandemic, so our data is somewhat limited,” Rubenstein says. “Before expanding the geographic area, I would go back in time, say from six months to one year of sales and maybe even to 18 months if there is very light inventory.”
Spaniak takes a different approach. “If there aren’t many comps to be looking at, [sellers] need to understand, first, if the home will appraise at the most likely sales price,” she says. “If the answer is yes, they need to understand if it’s a buyer’s market or a seller’s market.”
She says she expands the search area to include comparable neighborhoods. “I suggest going a bit farther out in location to find the comps and know that it’s not an exact science.”
Comps Help Set Expectations Without Guarantees
Even with careful analysis, comps can’t predict exactly what your home will sell for. “Your price is not what you believe [the home is worth]. It’s what your buyer believes,” Spaniak explains. She encourages sellers to pay attention to how buyers respond once the home is listed. “If you get no showings, the price is too high,” she says. “Very few showings in the first two weeks means your price is too high, or 15 showings and no offers, your price is too high.”
“The biggest precaution in looking at comps is that no two homes are exactly the same,” Rubenstein says. “Many factors go into pricing, and comps are a basis for starting to form the pricing strategy.”
The value of a comparative market analysis goes beyond arriving at a list price. A comp provides insight into how buyers are behaving, how quickly similar homes are selling and whether pricing expectations align with current market conditions. Combined with the expertise of a knowledgeable real estate professional, comps can help you make informed decisions from listing through closing.
Nicole Slaughter Graham is a contributing editor for REALTOR® News and oversees the Brokers, Technology and Home & Design sections. She also manages NAR’s YPN Lounge, a blog written by Young Professionals Network members. Contact her at ngraham@nar.realtor.
