An asking price is the seller's opening number, not a verdict on what a home is worth. Before you make an offer, it helps to check that number against the home's own history and against what similar homes actually sold for.

You don't need to be an appraiser to do this. With property records, a short list of recent sales, and a realistic repair estimate, you can tell a price that looks fair from one that looks high, and spot a "bargain" that stops being one once repairs are counted.

Start With the Home's Own History

A home's sales history shows when it last sold, for how much, and how the current listing has changed. Look for:

• The last sale price and date. Compare them with how prices nearby have moved since.
• A recent resale. If the home sold not long ago and is back at a much higher price, ask what changed: permitted renovations, or mostly paint and staging?
• Price changes on this listing. Reductions, or a listing that was pulled and later relisted, can signal a price that started too high.
• Property facts. Check bedrooms, bathrooms, square footage, lot size, and year built against the tax records. A mismatch throws off every comparison you make.

Find the Right Comparable Sales

Comparable sales, or comps, are recent sales of similar homes nearby. The closer the match, the more useful the comp. Look for homes that:

• Sold recently, ideally within the last few months
• Are close by, ideally in the same neighborhood
• Have similar square footage, bedrooms, bathrooms, age, and lot size
• Were in similar condition when they sold

Focus on sold prices, not asking prices. A list price is what a seller hopes for, while a sold price is what a buyer actually paid. Active and pending listings show you the competition, but closed sales are your best evidence.

Adjust for Condition

Condition is where many foreclosure and as-is shoppers go wrong. If the nearby comps were renovated and the home you like needs a roof and a kitchen, those comps set a ceiling, not a target. One simple way to work through it:

1. Start with what similar updated homes sold for.
2. Subtract your estimated repair costs, based on an inspection and contractor bids.
3. Subtract a cushion for surprises, plus utilities, insurance, and taxes while work is underway.
4. Compare what is left with the asking price.

Our guide to buying a fixer-upper or as-is home covers inspections and repair budgets in detail.

Why Price per Square Foot Can Steer You Wrong

Dividing price by square footage is a quick screen, but it hides a lot:

• Smaller homes often show a higher price per square foot than larger homes nearby.
• Finished basements, additions, and garages may be counted differently from one listing or record to the next.
• Lot size, layout, updates, and condition don't show up in the math at all.

Use it to spot outliers, then dig into the details.

Tax-Assessed Value Is Not Market Value

Tax records show an assessed value that the local assessor uses to calculate property taxes. Assessors follow their own schedules and rules, and some places limit how quickly assessments can rise, so the assessed value can sit well above or below what the home would sell for today.

Tax records are still useful. They help you confirm property facts, see the current tax bill, and plan for your own taxes, which may change after a sale depending on local rules.

Days on Market and Price Drops

A home that sits unsold much longer than similar homes may be priced too high, or it may have a condition or financing hurdle that other buyers are avoiding. A price drop can mean the seller is more open to negotiating, but it doesn't make the home a bargain on its own. Some listings reset their day count when relisted, so check the sales history for earlier listings.

Auction Opening Bids and Government List Prices

At a foreclosure auction, the opening bid often reflects what is owed on the loan or what the foreclosing lender chooses to bid. It is not an appraisal, and you may not be able to see inside before you bid. Our guide to foreclosure stages explains what to expect at each step.

HUD homes work differently. According to HUD Home Store, a HUD home's list price is a fair market value based on a recent appraisal, offers can come in under or over that price, and bids are ranked by the highest net to HUD, so ask your HUD-registered broker how any costs you request affect your bid. Accepted bids stay posted for 14 days after a home goes under contract, which gives you more data points.

The Appraisal: Your Lender's Check on the Price

If you use a mortgage, your lender will typically order an appraisal, an independent opinion of the home's market value. For a first mortgage, federal rules give you the right to a free copy, provided promptly after it is completed or three business days before closing, whichever is earlier. The CFPB explains this right.

If the appraisal comes in below your price, you generally have a few paths:

• Ask the seller to lower the price.
• Pay the difference in cash, if your budget allows.
• Ask your lender about challenging the value. On conventional loans that follow Fannie Mae's rules, lenders must have a process that lets you request one reconsideration of value per appraisal, before closing, with up to five additional comparable properties. Other loan types handle this differently.
• Walk away, if your contract includes an appraisal contingency.

When to Ask for a Comparative Market Analysis

If recent sales are hard to find, or you're unsure how to adjust for condition, ask a real estate agent for a comparative market analysis, or CMA. It isn't an appraisal, but it draws on local sales data and the agent's knowledge of how condition affects price. Ask which comps they chose and why, and compare their reasoning with your own notes. If you're bidding on a bank-owned home, our guide to making a strong REO offer shows how to put that research to work.

The Bottom Line

A fair price lines up with what similar homes sold for once you account for condition, repairs, and the home's own history. Do that homework before you offer, and let the appraisal be your second check, not your first.

MyHomeZilla puts the raw material in one place. Save the homes you're considering to see each one's sales history, tax records, and property facts, compare them side by side, tour the area virtually with street and satellite imagery, and set up listing alerts to hear about price drops and status changes. When you're ready to talk with a seller, bring our questions to ask sellers.