
Property valuation: For which properties is the comparative value method suitable?
The comparative value method is a method of real estate valuation in which the value of a property is determined on the basis of comparative values of similar properties in the surrounding area. This method is based on actual purchase prices achieved on the real estate market and thus offers a practical approach.
When is the comparative value method useful?
The comparative value method is particularly suitable for properties located in markets with a sufficient number of comparable properties. It is therefore ideal for urban areas and for types of property that are frequently traded. Typical areas of application include:
1. Condominiums
Condominiums, especially in multi-family houses, are frequently bought and sold. In a residential area with similar apartments, comparative values can be easily determined. Factors such as living space, location, condition, and year of construction can be directly compared with other properties.
2. Single-family homes in standardized residential areas
The comparative value method is also suitable for new developments or other residential areas where many single-family homes are similar in design. If houses with similar sizes and characteristics have recently been sold in the neighborhood, these can serve as a basis for comparison.
3. Terraced houses and semi-detached houses
The comparative value method can also be used for terraced houses and semi-detached houses. Since these types of properties are often built in uniform developments, they are highly comparable.
What are the advantages of the comparative value method?
The comparative value method offers two key advantages:
- Market proximity: Since the method is based on actual purchase prices, it realistically reflects market conditions.
- Simplicity and comprehensibility: The approach is also understandable for laypeople, which makes it particularly popular in purchase and sale negotiations.
Conclusion: Who is this method ideal for?
The comparative value method is the first choice if you want to value a standard property in an active real estate market. This method delivers accurate and market-oriented results, especially in cities or new development areas where many similar properties are traded. However, for special properties or in less frequented markets, alternative valuation methods such as the asset value or income value method should be considered.
Are you unsure of the current value of your property and would like a well-founded valuation or assistance with selling your property? Contact us! We will be happy to advise you.
Notes:
For reasons of better readability, the generic masculine form is used in this text. Female and other gender identities are expressly included where necessary for the meaning of the text.
Legal notice: This article does not constitute tax or legal advice in individual cases. Please consult a lawyer and/or tax advisor to clarify the facts of your specific case.
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