How to use comparable sales properly

Start with recorded sales, not asks. Then grade. A sale can sit on the register and still be a false comparable for this decision.

Match the attributes that actually move price in that market. Land usually dominates detached houses. Bedroom count and building quality dominate units. Constraints matter when the subject lot carries one and the sale does not.

• Type. House with house, unit with unit, townhouse with townhouse. Do not cross.
• Land. For houses, stay inside a band of the subject’s official parcel area. A 350 m² lot and an 800 m² lot are different assets even on the same street.
• Dwelling. Similar beds, baths, age band and condition. Photographs from the sale campaign are a screen, not an inspection.
• Position. Same or adjoining suburb; similar street type; similar exposure to a main road, rail, school or industrial edge.
• Constraints. Similar flood, bushfire, heritage or acquisition status where you can tell. Confirm against that council’s scheme. Names differ by state.
• Timing. Prefer recent recorded sales. Beyond a year, say so and treat time as an explicit unknown, not a silent adjustment.
• Recorded. Sale events with dates. Not asks, not “sold” claims. See ask versus recorded sale.

No sale is identical. For each material difference, write better or worse for the subject, and why. A larger block, a renovated kitchen, a quieter street, an extra bedroom, a flood overlay across the building envelope: each has a direction.

Stop there unless you are a registered valuer working to a professional standard. A buyer’s worksheet that says “comp A is stronger land, weaker dwelling” is honest. A worksheet that subtracts $47,000 for a bathroom is performing a valuation without the licence, the inspection or the basis. Districts will not do that arithmetic for you.

Labelled illustration. Subject: three-bedroom house, official parcel about 520 m², no flood overlay, ask $1.12 million. Four recorded sales in the same suburb:

Sale 1: three-bed house, 540 m², 11 weeks ago, $1.05 million, similar street. Strong. Sale 2: three-bed house, 610 m², 7 months ago, $1.18 million, renovated. Reasonable; better dwelling, older. Sale 3: two-bed unit, $690,000 last month. False on type. Sale 4: four-bed house, 780 m², $1.40 million, flood overlay on most of the lot. Weak to false for this subject; different land and a constraint the subject does not carry.

What you can write: the ask sits above the one strong recent sale and below the renovated larger sale. What you cannot write: that the house is worth $1.08 million. The unit and the flood-affected larger house stay out of the range.

• Using the agent’s three comps without grading them. In Victoria those three sit on the Statement of Information because the statute asks for them, not because they are the best set.
• Filling gaps with asking prices or with the suburb median. See why median prices can be misleading.
• Crossing houses and units, then dividing by land area. See price per square metre.
• Keeping a related-party or developer-bulk sale because the number is convenient.
• Calling a four-sale worksheet a valuation.

Small suburbs, unusual types and quiet months produce few usable sales. Count usable comps, not every recorded transfer. A withheld price, a non-market dealing, or a dwelling that has changed since the sale is on the register and still out of your set.

Widen carefully: an adjoining suburb of similar stock, or a longer window with time named as a limit. If the decision is large and the set is still thin, that is the situation a registered valuer is for. Thin evidence is a finding. It is not a licence to borrow someone else’s guide.

Districts records sale events per property with date, price and source, and shows a suburb’s recorded sales count and median on the suburb profile so you can see the sample behind the figure. It does not select comparables or produce a value from them. Hazard and heritage status for a comparable is a judgement you confirm against that council’s scheme. Where the suburb sales count is small, the median is a small-sample figure and is labelled with that count.

Price and date through the state land registry or the source cited on the Districts page. Condition through contemporaneous listing photographs, with caution. Constraints through the official planning map for that lot, not through the subject property’s overlay list. Value, where the decision needs an accountable opinion, through a registered valuer.