What is the third step in applying the direct comparison approach?

What is the third step in applying the direct comparison approach?

• A. Gathering all comparable sales, listings, offers and rental locations, and check pertinent information on each.
• B. Analyze the data regarding differences in time of sale and other factors.
• C. Compare each sale to the subject property.
• D. Correlate the data and make preliminary value estimate.

Answer: (A)

In the direct comparison approach, the process moves from collecting data to translating that data into a value by directly evaluating how each comparable stacks up against the subject. After you’ve gathered comparable sales, listings, offers, and rental data and verified the details on each, the next move is to compare each sale to the subject property. This step involves lining up each comparable with the subject and assessing how they differ in key attributes like size, location, condition, features, and the terms of sale. This side-by-side comparison highlights what adjustments are needed to make the comparables truly apples-to-apples with the subject. Those adjustments, in turn, feed into the later step of correlating all adjusted values to arrive at a preliminary value estimate. While gathering data is essential, the actual comparison of each sale to the subject is what drives the adjustment process and anchors the valuation.

In the direct comparison approach, the process moves from collecting data to translating that data into a value by directly evaluating how each comparable stacks up against the subject. After you’ve gathered comparable sales, listings, offers, and rental data and verified the details on each, the next move is to compare each sale to the subject property. This step involves lining up each comparable with the subject and assessing how they differ in key attributes like size, location, condition, features, and the terms of sale. This side-by-side comparison highlights what adjustments are needed to make the comparables truly apples-to-apples with the subject. Those adjustments, in turn, feed into the later step of correlating all adjusted values to arrive at a preliminary value estimate. While gathering data is essential, the actual comparison of each sale to the subject is what drives the adjustment process and anchors the valuation.