Reading Comps — Is This Listing Priced Fairly?

The short version: "Comps" (comparable sales) are how you tell whether a listing price reflects the actual market or just what a seller hopes to get. Learning to read them yourself means you're not relying purely on someone else's opinion of value.

What a comp actually is

A comparable sale — a similar home, in the same general area, that sold recently. "Similar" means close in size, age, condition, and features, not just "nearby." Say you're evaluating a 3-bedroom ranch: a similar 3-bedroom ranch two streets over that sold recently is a real comp; a 5-bedroom new-construction home a mile away generally isn't, even if it's the only recent sale someone can point to.

What actually makes a comp useful

• Recency — sales from the last 3-6 months matter more than sales from a year ago, especially in a market that's moving quickly in either direction.
• Proximity — genuinely nearby, ideally the same neighborhood or school zone, since location drives value more than almost anything else.
• Similar size and condition — square footage, bed/bath count, and renovation status all matter; a fully renovated comp will overstate the value of a home that needs work, and vice versa.

The adjustments that actually matter

Real comps rarely match perfectly, so some analysis is needed to adjust for the differences — a comp with an extra bathroom or a finished basement should be adjusted down before being compared to a listing without those features, and vice versa. This is exactly the kind of judgment call where a good agent's local experience (see our agent guide) genuinely earns their keep, rather than something a simple online estimate reliably captures.

Active listings aren't comps

A neighbor's home currently listed at $450,000 tells you what they're hoping to get, not what the market has actually paid. Only closed, recorded sales are real comps — active listings are simply someone else's guess, which may or may not hold up.

What to actually do with this

Ask your agent for a comparative market analysis (CMA) before you make an offer — a real, documented comparison, not a gut feeling. Your agent will show you these comps and walk through them with you, which is exactly the moment to ask questions if anything doesn't add up. If a listing price looks meaningfully out of step with recent comps in either direction, that's worth a direct conversation before you get emotionally attached to the number on the sign.