The direct answer
Appraisers select comparable sales based on how well each sale helps explain the subject property’s market behavior. Recency, proximity and physical or economic similarity all matter, but no single factor automatically makes a sale the best comparable.
Start with the same market and property rights
A useful comparable should compete in a similar market and reflect a comparable property interest. Location, use, buyer profile and transaction conditions can matter as much as raw distance.
To apply the approach to an editable scenario, use the Real Estate Comps Calculator. For the neighboring question, explore Property Value Calculator.
Balance recency with similarity
A very recent sale can still be weak if the property is materially different. An older sale may be informative when it is highly similar and market changes can be analyzed.
Document material differences
Size, condition, quality, site characteristics, income profile and sale conditions may require adjustment or qualitative reconciliation. The goal is not to find an identical property but to explain why each sale is relevant.
Worked example
A sale two blocks away from last month may be less persuasive than a six-month-old sale one mile away if the nearby property is a different class, size and use while the farther one closely matches the subject.
Open Real Estate Comps Calculator and test your assumptions →
Common mistakes and limitations
Do not select comps only because they are the nearest or highest-priced sales.
Price-per-square-foot is a simplified comp method and should not replace full adjustment analysis.
Frequently asked questions
Are the closest sales always the best comps?
No. Proximity matters, but similarity, market area and transaction relevance also matter.
How recent should a comparable sale be?
There is no universal cutoff; recency should be evaluated with market conditions and comparability.
Sources and further reading
The article’s examples are illustrative arithmetic. The references below provide context for operating, valuation or transaction concepts; they do not endorse the assumptions or the calculator.
- IRS — Instructions for Form 709 (2025) — real property valuationComparable-sales concept and adjusting for differences in date, size, condition and location.
- IRS — Publication 551 (12/2025), Basis of AssetsFair-market-value concept and use of similar-property sales as evidence.
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