What does the matched pair adjustment technique involve?

The matched pair adjustment technique involves estimating value based on competing properties that have different features. This approach is primarily used in comparative market analysis to determine how much certain features of a property affect its value in the market. By analyzing similar properties with comparable characteristics—such as size, location, and amenities—but differing in specific attributes, an appraiser can assess the impact of these differences on the overall value.

When utilizing this technique, appraisers find pairs of properties that are as similar as possible in most respects except for the feature being evaluated. For instance, if one property has a pool and another does not, the appraiser would consider how much more buyers would be willing to pay for the property with the pool compared to the one without. This allows for a more refined valuation that reflects the real market dynamics at play.

This adjustment is vital in real estate because it considers how various features contribute to property desirability and price, providing a more accurate market evaluation.