Investor Encyclopedia

Sales Comparison Approach

Sales Comparison Approach: a practical Canadian real estate investor guide to underwriting use, deal risk, common traps, and Realist.ca implementation.

Definition

Sales Comparison Approach is a real estate term investors use to assess valuation discipline, comparable evidence, lender/appraiser confidence, and whether assumptions survive market reality.

Example

An investor reviewing a Canadian property tags sales comparison approach as a diligence item, links it to source documents, and reruns the model if the answer changes purchase price, closing certainty, rent, financing, capex, or exit value.

Why It Matters

Sales Comparison Approach matters because it changes valuation discipline, comparable evidence, lender/appraiser confidence, and whether assumptions survive market reality. The mistake is treating it as paperwork when it is really a deal constraint.

Investor Interpretation

Use sales comparison approach as a decision filter: if it cannot be verified, priced, insured, financed, or managed, the right move is a lower offer, stronger condition, larger reserve, or a walk-away.

Realist Tie-In

Realist.ca can make Sales Comparison Approach searchable, connect it to related guides, attach it to saved deal analyses, and surface the right checklist/calculator beside listings, underwriting pages, and investor lead magnets.