In selecting comparables, how should location be treated in the appraisal process?

In the appraisal process, location is highly significant because it directly influences a property’s value. When selecting comparables, it is ideal for properties to be within the same neighborhood. This is due to several factors, such as the overall market conditions, amenities, school districts, crime rates, and other local characteristics that can vary significantly from one area to another.

Properties located in the same neighborhood tend to share similar attributes regarding desirability and market dynamics, which makes them more reliable for comparison. Values may fluctuate dramatically even over short distances, so proximity helps ensure that the comparables reflect realistic expectations for the property being appraised. Relying on properties from different neighborhoods can lead to inaccuracies in the appraisal due to diverse influences on pricing that are not accounted for.