What method is used to develop reasonable adjustments in the Sales Comparison Approach?

The Sales Comparison Approach relies heavily on Market Analysis to develop reasonable adjustments for differences between comparable sales and the subject property being appraised. Through Market Analysis, an assessor can evaluate trends, conditions, and the characteristics of the market to determine how various factors influence property values.

This approach includes examining recent sales data and understanding how various elements, such as location, property size, condition, and features, affect the prices of properties. By performing a thorough Market Analysis, the assessor can make informed adjustments to the sale prices of comparable properties to accurately estimate the value of the subject property.

Other methodologies, like Economic Base Analysis or Cost Analysis, focus on broader economic indicators or specific cost structures, while Contract Analysis pertains to examining the terms of agreements rather than the comparative value of sales in the market. Each of these methodologies serves different purposes in property evaluation but does not align with the actionable adjustments needed in the Sales Comparison Approach as effectively as Market Analysis.