Property Valuation
In New Mexico, when an appraiser selects 'comparable sales,' the most important factors are:
AOnly the number of bedrooms and bathrooms
BLocation, physical characteristics, condition, and time of sale — with emphasis on properties the market views as substitutes for the subject✓ Correct
CProperties sold in the same calendar year only
DOnly bank-owned and foreclosure sales
Explanation
Good comparable sales are similar to the subject in location (same neighborhood or competing area), physical characteristics (size, style, amenities), condition, and recent sale date. The goal is to find sales the market views as legitimate substitutes for the subject property.
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Key Terms to Know
Comparable Sales (Comps)
Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
DepreciationA reduction in the value of an improvement (building) over time due to physical deterioration, functional obsolescence, or external factors.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
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