Market Analysis as the Economic Foundation of the Sales Comparison Approach: Evidence, Comparable Selection, Adjustments and Reconciliation

The Sales Comparison Approach draws on completed sales, reported sales, listings, offers and asking prices, which differ in economic meaning and reliability. A completed sale records an exchange under particular circumstances, and an asking price records a seller’s expectation. Neither fixes market value, and the weight each deserves depends on verification, on whether the property competes in the subject’s market, on the support for the adjustments applied, and on how the indications are reconciled. This article examines market analysis as the economic foundation of the approach and proposes a structured protocol for integrating and reporting four connected steps: classifying evidence, with economic comparability assessed separately from price reliability; selecting comparables from a defined competitive market; treating asking-to-sale adjustments and property-characteristic adjustments as different questions, with a check for double counting; and reconciling indications by the quality of their evidence and not by unexplained averaging or weighting.