Thursday March 26 2026 Class #15

 

 SALES COMPARISON APPROACH

CHAPTERS 20, 21 & 22

PART 2

B. Typical Adjustment Grid (Your Preferred Format)

• Financing Terms
• Condition of Sale
• Sale Date (Time Adjustment)
• Location
• Size (SF or acreage)
• Condition / Age
• Garage / Parking
• Utility / Layout

---

C. Quantitative vs. Qualitative Adjustments

• Paired Sales Analysis
• Statistical / Regression Analysis
• Sensitivity analysis
• Ranking analysis

---

V. ADJUSTMENT PROCESS

A. Adjustment Sequence

1. Transactional adjustments (market-based)
2. Property adjustments (physical)

B. Direction of Adjustments

• Comparable superior → adjust downward
• Comparable inferior → adjust upward

C. Techniques

• Dollar adjustments
• Percentage adjustments
• Hybrid methods

---

D. Advanced (MAI-Level)

• Regression modeling (target R² ≥ 0.90 as you prefer)
• Market extraction techniques
• Allocation methods

---

VI. RECONCILIATION PROCESS 

A. Weighting of Comparables

• Most similar receives greatest weight
• Reliability of data
• Consistency of adjustments

B. Final Value Indication

• Range vs. point estimate
• Supportable narrative conclusion

---

VII. REPORTING REQUIREMENTS (USPAP) 

A. What Must Be Included

• Identification of comparables
• Description of adjustments
• Rationale and support

B. Common Errors to Avoid

• Unsupported adjustments
• Over-reliance on one comp
• Failure to verify data