| When assessing the value of a property, many | | | | the uses? Assess each one individually and then |
| investors and other commercial property buyers | | | | group them together to determine an overall |
| look at comparable sales to determine the true | | | | consensus. You should be able to determine the |
| current market value of a property. The | | | | current market value at this point. The more |
| comparable sales can show you exactly what | | | | properties you have to pool from, the more |
| properties are selling for, not just the asking price. | | | | accurate a number you will have.Very often |
| If you know three or four properties of similar | | | | brokers or agents supply you with comps from |
| characteristics sold for about the same amount, | | | | the area of interest as part of the service of |
| then you can determine what the value of your | | | | selling the subject property. If you are not familiar |
| property is. Don't ever just look at the asking | | | | with the area, you must be leery of the comps |
| price, as it can be as far off as the owner wishes. | | | | that they send you.I have received comps of |
| He or she may be dreaming in regards to what | | | | properties in the most affluent areas for a |
| the property is really worth!Comparable sales, or | | | | subject property that was positioned in a lower |
| comps, are the properties that have sold around | | | | to medium class area which completely |
| the subject property that are zoned identically, | | | | misrepresented the true market value of the |
| and are about the same amount of acreage. It | | | | property. Unless I had investigated further and |
| also helps if the comparable sales are from | | | | asked many questions, I could have easily taken |
| properties that have similar uses.Comparable sales | | | | this property as a true comparable sale, and |
| may not always be the most accurate for your | | | | would have expected a far greater return than |
| specific property. They could be from many | | | | what I really would have |
| years ago, may not be of similar use, many not | | | | experienced.Unfortunately, as much as you want |
| have the same characteristics such as the | | | | to trust the information that you are given by a |
| availability of utilities, or may not have a | | | | source, you must always perform your very own |
| comparable amount of road frontage, or could be | | | | investigation because brokers and agents are |
| a considerable distance from the subject | | | | there to sell their properties. Many of them are |
| property.In order to get around this problem, you | | | | honest and will do the best they can to give you |
| must use the closest properties that you can. You | | | | the most accurate information. However, there |
| simply adjust the price according to the changes | | | | are those who will dupe a buyer in order to sell |
| in the market or property characteristics.For | | | | the property and receive their commission. It is |
| example, if a comparable sale was from 2001, | | | | important to be aware of these tactics. Although |
| and the current year is 2006, then you can adjust | | | | we don't like to admit that they happen, they |
| the price according to the appreciation the overall | | | | most certainly do.Comparable sales are really the |
| commercial market has experienced in a specific | | | | only way you can determine the true value of a |
| area.Or, if the subject property has a total road | | | | property. It may take a comparable from another |
| frontage of 200 feet, and the comparable sale | | | | city, or even county of identical characteristics to |
| property has frontage of 1000 feet, you can | | | | determine the most accurate value. If necessary, |
| adjust the price or value appropriately.As you can | | | | ask a trustworthy broker or agent for assistance, |
| see, finding the true current market value of a | | | | as they will know their market inside and out, and |
| property can take some investigation and | | | | be able to point you in the right direction as to |
| adjustment in relation to the properties that have | | | | what the property is really worth. Get two or |
| sold in the past. The more recent and similar the | | | | three opinions in order to validate any information |
| comparable sale is, the easier and more | | | | you might receive.Tony Seruga, Yolanda Seruga |
| accurately you can assess the true value of the | | | | and Yolanda Bishop of specialize in commercial and |
| property.It is a good idea to collect as many | | | | investment real estate. As of May, 2006, they |
| comparable sales as possible and take inventory | | | | and their partners are managing over $600 million |
| of each. What are the characteristics? What are | | | | dollars worth of new projects. |