Summary

Paired sales analysis is a real estate appraisal method used to determine the specific value of a particular feature or improvement in a property. It involves comparing the sale prices of similar properties that differ in only one characteristic or feature (e.g., a specific upgrade or improvement). By isolating the impact of that specific feature on the property's value, appraisers can estimate the contribution of the feature to the overall property value and make more accurate adjustments in their appraisal process. Paired sales analysis is especially useful when valuing unique or custom-built properties where direct comparisons are limited.

Paired Sales

A paired sale analysis in residential real estate appraisal is a method used to determine the value of specific features or characteristics of a property by comparing it to similar properties that have recently sold with and without those features. This approach helps isolate the contributory value of a particular attribute by holding all other variables constant. Here's a step-by-step explanation of the process for completing a paired sale analysis within Appraiser Toolkit:

1. Data collection and selection of Paired Sales: The appraiser begins by collecting data on recent sales of properties that are similar to the subject property. These comparable sales are selected by finding one property with the specific feature being analyzed (e.g., a garage, swimming pool, or upgraded kitchen) and another property without that feature but otherwise comparable in terms of location, size, condition, and other relevant attributes
2. Adjustment factors: Compute the disparities between the sale prices of the paired properties. These disparities serve as an estimation of the value attributed to the specific feature under examination. For instance, if the property with a garage was sold for $20,000 more than the property lacking a garage, the estimated contributory value of the garage would amount to $20,000. However, it's crucial to acknowledge that this portrayal oversimplifies the procedure. Property characteristics rarely hinge on a single distinction. Consequently, the appraiser initially carried out adjustments on the comparable property to account for all other influencing factors before embarking on the value comparison
3. Reconciliation: After calculating the adjustments for each comparable pair, the appraiser reconciles the indicated adjustments to arrive at a final estimate of the contributory value of the specific feature

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