What are comparables in the context of real estate appraisal?

Comparables, often referred to as "comps," are properties that are substantially equivalent to the subject property in terms of various characteristics such as location, size, age, and features. In real estate appraisal, they serve as benchmarks to assess the value of a specific property. By evaluating properties that are similar to the one being appraised, an appraiser can derive a more accurate estimate of its market value.

Using comparables allows appraisers to account for the nuances of the real estate market and understand how similar properties have performed in terms of sale prices. This method is essential for ensuring that the appraisal reflects current market conditions and the specific attributes of the property in question.

The other options do not accurately define comparables in this context. Properties in need of renovation might not represent an accurate comparison if the subject property does not have the same level of disrepair. Properties on the market do not necessarily reflect completed sales and, thus, may not provide a reliable basis for appraisal. Lastly, while properties that have sold recently can inform an appraisal, they must also be substantially comparable to effectively assist in determining the value of the subject property.