What does an appraiser analyze when utilizing the sales comparison approach?

When utilizing the sales comparison approach, an appraiser focuses on analyzing sales of comparable properties in the market. This approach is grounded in the principle of substitution, which states that a buyer would not pay more for a property than they would for an equally desirable substitute. By examining recent sales data of similar properties that have been sold under similar market conditions, the appraiser can establish an appropriate value for the subject property.

This method involves looking for properties that are similar in size, condition, location, and features to ensure an accurate comparison. Adjustments may be made to account for differences in these characteristics, ensuring the comparison remains valid. This approach is widely used for residential properties as it reflects current market trends and conditions effectively.

The other choices, while relevant in different contexts, do not pertain directly to the sales comparison approach. Historical tax rates are useful for financial assessments but do not impact the market value of a property. Development plans and future projections might influence long-term value considerations but are not part of the immediate comparative analysis performed in this approach. Thus, focusing on comparable sales provides the most direct and applicable method for determining property value within the framework of the sales comparison approach.