The sales comparison approach (also called the market approach) determines property value by analyzing recent sales of comparable properties and adjusting for differences. It's the primary method used to value residential properties for tax purposes.
The logic is straightforward: your home is worth approximately what similar homes in your area have sold for. Adjustments are made for differences in size, condition, features, and location to arrive at an indicated value for your specific property.
This approach works best when there are sufficient recent sales of truly comparable properties—which is why it's the go-to method for residential neighborhoods but less reliable for unique or rural properties.
The sales comparison approach is your most powerful protest tool because it's the same method the county uses—and you can often do it better.
Why you might beat the county:
• You know your neighborhood intimately
• You can identify truly comparable sales they missed
• You know your home's actual condition
• You can spot errors in their adjustments
Building your case:
• Select 3-5 strong comps (arm's length, recent, similar)
• Document adjustments clearly
• Show your math
• Calculate a supported value below your assessment
Appraisal districts respect well-researched comparable sales analysis. It speaks their language.
How the sales comparison approach works:
Step 1: Find comparable sales
• Recent (within 6-12 months)
• Nearby (same neighborhood preferred)
• Similar (size, age, style, condition)
Step 2: Make adjustments
• Your home is 200 sq ft smaller: -$20,000
• Comp has pool, yours doesn't: -$25,000
• Your home has updated kitchen: +$15,000
• Comp is on busy street: +$10,000
Step 3: Calculate indicated value
Comp sale price: $450,000
Net adjustments: -$20,000
Indicated value: $430,000
Repeat for 3-5 comps, then reconcile to a final value opinion.
Three to five strong comps are typically sufficient. Quality matters more than quantity—one excellent comparable that's very similar to your home can be more persuasive than ten mediocre ones with heavy adjustments.
Adjust for differences that affect value: square footage, lot size, bedrooms/bathrooms, garage, pool, condition, updates, location factors. Standard adjustments in your market might be $50-100 per square foot, $20-40K for a pool, etc. Research local norms.
This is common in rural areas or unique properties. You may need to expand your search area, use older sales with market trend adjustments, or rely more heavily on the cost approach. Explain the lack of comps in your protest—it may work in your favor.