What does the term 'comparable' refer to in real estate?

In real estate, the term 'comparable' refers to properties that share similar characteristics such as features, size, condition, location, and amenities. These comparables, often used in property appraisals, help determine the fair market value of a property by comparing it to recently sold properties that are alike. By analyzing these similarities, real estate professionals can provide an educated assessment of a property’s worth in relation to the market dynamics.

The focus on properties that are similar in features and location allows appraisers and buyers to create an accurate picture of value based on real market activity. The other choices do not capture this essential meaning: properties sold under market value do not necessarily reflect current market conditions; properties in auction can vary widely in terms of appeal and condition; and properties requiring extensive repairs might not effectively represent the market value of comparable homes in a given area. Thus, the emphasis on features and location in defining 'comparable' highlights its correct interpretation in the context of real estate valuation.