What Are Comparables (Comps) in Property? 🏠 Quick Explanation

Let’s keep this definition short and sweet...

What Makes a Good Comp?

For example, if you are trying to value a 2-bedroom terraced house on a road, you want to find other 2-bedroom terraced houses on the road that have sold in the last few months. 

You can’t just use the average house price from a house price index.

But you don’t want to be looking at rundown properties if the property you are trying to value is finished to a high standard and ready to move in.

You don’t want to be looking at 2 bedroom terraced houses from 8 years ago either because the market changes so much. 

And you certainly don’t want to be looking at 4-bedroom detached houses just because they are on the same road as your property. 

If you cannot find any other properties that have sold within the last few months then look at the last year. 

Then you could look to see properties within ¼ mile of the property you want to value.

You could then increase it to ½ mile. 

If you’re really struggling to find anything then look at properties within 1 mile and sold within the last 2 years.

Just know that the comparables are less accurate the further back in time and the further away you get, so you can’t rely on them as much. 

When increasing the distance from properties on the same road, make sure to be extremely careful of the properties you look at. 

Sometimes the prices of properties only 1-2 roads away from each other can be very different. 

To help you with this you can go on Google Street View to get a feel for the nearby roads and what they look like.

Also, see what the average prices tend to be on nearby roads. 

Maybe if you go in one direction the prices tend to go down, but if you go in the other direction the prices go up.

Take this into account when looking at your comps. 

Using Square Footage With Comparables 

Sometimes you may find properties that are similar in type and location but they differ in size. 

To make your estimates more accurate you can compare the square footage of the properties on a pro rata basis. 

Comparable: Example Scenario

Let’s say you have ‘Property 1’ which is a 3-bedroom semi-detached property 105 square metres in size and is in good condition.

On the same road, you find a comparable property, we’ll call it ‘Property 2’.

Property 2 is a 3-bedroom semi-detached property that sold 3 months ago for £300,000 and it’s also in good condition.

But this one is 113 square metres in size. 

The price per square metre for Property 2 is:

• £300,000 / 113 = £2,655 / sqm

If we assume the only thing different about this property is the size, we can predict what our property would be worth using the size in square metres and multiplying it by the price per square metre of the comp. 

So we do the following…

Size of the property multiplied by the price per square metre.

105 sqm x £2,655 = £278,775

Here’s a quick summary of this scenario…

Where to Find Comparables?

Luckily, the Land Registry has data on the price paid for properties sold since 1995 and sites like Rightmove integrate this data. 

On any listing on Rightmove, scroll down the page and click on ‘Recently sold & under offer‘.

Then to see all properties that have sold and completed on the sale click the link that says ‘View all recently sold‘.

On the next page, you’ll be able to see all the properties that have sold within a certain radius of the property listing you were looking at.

You can change the filters to different time periods, distances, property types, and tenure.

Since a large proportion of properties in the UK are listed on Rightmove you can also see the listing information, including photos of the property when it was listed. 

Zoopla also does the same thing, so if the listing is only on Zoopla you can check there instead.

Using this method lets you see when the property was sold along with the condition of the property and the full address. 

See our post on predicting end value of a property using Rightmove comparables to see this in action.

Further Reading

Learning how to price up a property is vital for any property investor or deal packager.

This is especially important if it’s a rundown property that needs a refurb because you can plug in the refurb costs and look at the end value of a property before you find a property investor and pitch the deal to them.

Now that you know what a comparable is, make sure you know all the ways to find BMV properties so you can stay ahead of the game as a deal sourcer or property investor.