What comparable sales mean in Canadian appraisal work and why lenders and appraisers rely on them when judging property value.
Comparable sales, often called comps, are recently sold properties used as evidence when estimating the value of another property.
Comparable sales are one of the most common building blocks behind appraised value and market value. Borrowers may never see the full valuation logic, but the result often depends heavily on the quality of the comps.
Appraisers generally look for sold properties with meaningful similarities in location, type, size, condition, and features. They then analyze how those sales compare with the subject property and adjust for relevant differences where needed.
The goal is not to find an identical property, which may be impossible, but to build a reasonable evidence base for the value conclusion.
An appraiser valuing a suburban detached home may use several recent sales from the same area with similar lot size, age, and living space. If one comparable has a renovated basement and the subject does not, that difference may be considered in the analysis.
Comparable sales are not the same as active listings. Listings can be relevant context, but sold properties usually provide stronger evidence of what buyers actually paid.
Borrowers also sometimes think one exceptional sale proves the home’s value. Appraisal work usually relies on a broader evidence set rather than a single outlier.
The usefulness of comps depends on market depth, property uniqueness, and how recent the evidence is. In thin or rapidly changing markets, comparable-sale analysis can be more judgment-heavy.