The comparable sales method in one paragraph
Professional appraisers value a home by looking at what similar homes sold for recently — the "comparable sales" or "sales comparison" approach. It's the same method this calculator uses. Pull 3 recent sales that are similar in size, location, age, and style. Compute the price per square foot for each. Average those. Multiply by your home's square footage. Adjust for bedrooms, bathrooms, and condition differences. The resulting number is a defensible estimate of market value.
Where to find comps
You have three good sources. Zillow and Redfinboth publish recent sold prices — filter to "sold" and "last 90 days" in a half-mile radius. Your county assessor's website publishes deed transfers; the price is public record. A local real estate agent can pull a CMA (comparative market analysis) from the MLS, which includes expired and withdrawn listings in addition to sold — and those tell you what buyers wouldn't pay, which is useful context.
Avoid using current listings as comps. An active listing is an asking price, not a sale price — and in today's market, final sale prices can be 3–10% lower than asking, or 5–15% higher in bidding-war situations. Only closed sales tell you what a willing buyer actually paid.
Adjusting for differences
No two homes are identical, so raw price-per-square-foot needs adjustment. The standard appraisal grid works like this: if your home has one more bedroom than the comp, add $3,000–$7,500. One extra bathroom, $2,500–$5,000. Finished basement not in the comp, add $15–$25 per square foot of finished basement. A renovated kitchen the comp doesn't have, add $25,000–$50,000 depending on quality. A pool in a region where pools matter, $15,000–$35,000.
The direction matters: you adjust the comp's price, not your home's. If the comp has features your home lacks, subtract from the comp. If the comp lacks features your home has, add to the comp. Then average the adjusted comp prices. This is how appraisers land at a defensible "opinion of value."
Why price per square foot alone isn't enough
Price per square foot is the starting point, not the destination. Two homes at 2,000 sqft can trade at wildly different per-sqft figures in the same neighborhood — a renovated 1920s craftsman and a tired 1970s ranch might be $280/sqft and $210/sqft respectively, reflecting the market's preference for the more desirable architecture and updates.
The calculator's "condition adjustment" field is where you bake in these qualitative factors. A home with recent major updates (kitchen, bath, roof, HVAC) commands a 5–10% premium over the same home in original condition. A home that needs cosmetic work trades 5–10% below market. A home needing structural or systems work (foundation, roof, plumbing) can trade 15–25% below.
When this method breaks down
- Unique or custom homes. A one-of-a-kind architect-designed home in a neighborhood of tract homes has no comps. You need a specialized appraiser who values unique features using the cost approach (land value + replacement cost of improvements, minus depreciation).
- Rural areas. If the nearest comparable sold a mile away and was 9 months ago, your estimate is weak. Adjust for the passage of time using a local median sale price trend, and be honest that your confidence interval is wider than ±5%.
- Hot or cold markets. Comps reflect the recent past. In a fast-appreciating market, today's buyer will pay more than yesterday's seller got. In a declining market, the opposite. Watch days-on-market for active listings to gauge current momentum.
- Investment properties. A rental is also valued by its income — see our rental yield calculator and investment property calculator. Owner-occupied pricing and investor pricing can diverge significantly in the same neighborhood.
When you need an actual appraisal
Run this calculator all day to sanity-check offers or decide whether to list your home. But an estimate is not an appraisal. You need a real appraisal when: the lender requires one (every purchase loan, many refinances), when a judge requires one (divorce, estate), when you're disputing a tax assessment, or when you're considering a substantial cash offer and want an independent check before accepting.
A residential appraisal typically costs $400–$700 and produces a 10–40 page 1004-form report with photos, comps, maps, and a signed opinion of value. It's legally admissible and lender-accepted. If you're making a decision with more than $10,000 on the line, the appraisal fee is trivial compared to the risk of pricing wrong.
Related tools
Once you have a value estimate, pair it with our mortgage payment calculatorto see what's affordable, our home equity calculator to figure out how much you could borrow against it, or our renovation ROI calculator to see which improvements actually increase resale value.