How To Find Comps Without Access To The MLS?
Using the Multiple Listing Service (MLS) is the best and most reliable source for accurate information needed to conduct a comparable analysis on a property. However, if you are not a real estate agent or don't have access to an agent, you will need to find comps a different way.
The best alternatives to finding comparables (comps) without access to the MLS is to utilize both public property records and online listing services such as Zillow and Redfin. Both of these resources can provide an investor with fairly accurate information that can help them estimate a property's value.
Granted, these alternatives are not 100% accurate; when used correctly, they are fairly effective tools that help investors and homebuyers make informed decisions when buying or selling real estate.
Using Public Property Records for Comps
Using public property records should be the first alternative method for finding comparable properties within an area if you don't have access to the MLS. The data represented within public property records are obtained by the county at the sale of a property, which means most of the time, its information is accurate.
In fact, it is fairly typical that the public property records will reflect almost completely accurate information unless there are seller concessions made during a real estate transaction.
For example, a seller may offer to repair some big items within the home that you would need to be repaired immediately once you move in. Instead of lowering the property's purchase price, the seller repairs the required items with their money, and the original selling price doesn't change as a result.
This example reflects that the buyer received a discount on the property, but the public property records will not reflect the discount. The public property records will incorrectly represent the purchase price for the home without the price of the repairs deducted from the total.
Where To Find Public Property Records
Public property records can be found in person at a local county courthouse, clerk's office, or electronically using an online database. It can be difficult at times to locate property records because each county has a different process and system. Therefore, if you are considering using public property records to find comps, the first step is to find out how property records are stored in your prospective county.
Some investors decide not to utilize this method because they don't want to take the time to locate the property records, especially if they are at the courthouse or clerk's office. If they cannot access these records online, it can be a major drawback to using this strategy for comparables.
What Information Is Provided
During a real estate transaction, the county in which that transaction resides will be notified and receive information related to the transaction. The county should have just about every detail possible you will need for a comparable analysis. Similarly to the MLS, it will have information related to what a specific property last sold for, the number of beds and bathrooms, square footage, and other amenities.
In most cases, you will find that this information is just as accurate as the information that the MLS has.
Using Online Marketplaces & Listing Services for Comps
Online real estate marketplaces and listing services are great resources and tools at our disposal that can be used from the comforts of our homes. Not only can they be used to find comparables, but they also allow properties for sale to achieve greater exposure to the public. The main four online platforms that you should use depending on what market you are investing in are:
These marketplaces are very similar and have many of the same features across each platform. You should take some time to become familiar with the platform of your choosing so that you can get the most out of your decision.
Where does the data come from?
One unique aspect about all four marketplaces is that they can be even more useful than just using public property records because of the size of their databases. Each platform has a database created by allowing sellers to self-report property information and pull public property record data if it is accessible. Therefore, in some cases, going to one of these platforms may be a better option than just checking property records.
These sources are great tools to help estimate a comparable property within your market. However, similar to the county property records, the information you receive from these platforms is not 100% accurate. Since sellers have the ability to update their own descriptions for properties, sometimes the information is not correct.
Therefore, you shouldn't be surprised if some of the information is incorrect such as the purchase price, number of bedrooms, or even square footage. So when using these platforms, you should use them as only estimates until you take your next step of getting a real estate agent involved. Then you can cross-reference all of your information to make sure it is correct.
Special features of Online Marketplaces
One of the features that you may find when using an online marketplace is for sale by owner (FSBOs) that are listed and cannot be found on the MLS. The MLS is a massive database that real estate agents use to sell homes; however, if someone decides to sell their home on their own without an agent, then they will not use the MLS. The owner would turn to one of the online marketplaces like Zillow or Redfin to help sell their home.
Online marketplaces also have interactive interfaces that make finding and compiling information very simple for the users. For example, Zillow has software called Zillow Zestimate. The software can estimate the value of a property simply by the user inputting the address. Not only does the value of the property is shown, but other relevant statistics and amenities are shown if they exist in their database.
In a matter of seconds, you have the ability to locate all the information you will need to conduct a comparable analysis. If you were to use the public property records, there is no guarantee you can find the information that quickly.
Conclusion
In summary, this article was created to help you start finding comparables within your real estate investing market today. Whether you decide to use your public property records or one of the four online listing services, you have nothing to lose and everything to gain because they are all free resources that can help you get started.
But don't stop there!
Just because you use one of the alternative ways to finding comparable properties, you should always use a real estate agent to confirm your analysis if you are serious about buying the property.
All-in-all, don't let not having access to the MLS be the reason that you don't start or can't invest in real estate.