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How Buyers Should Think About Comps
How Buyers Should Think About Comps
What Makes a Good Comparison, What Doesn’t, and How to Make Sense of Pricing in a Market Where No Two Homes Match
“What is this house actually worth?”
This is the question smart buyers want their agents to answer for them.
Not in terms of the list price. Not based on what the neighbors think. Not leaning on what Zillow suggests. Not necessarily considering what the buyers hope to pay.
The real question is: What is reasonable?
This is the point where everyone wants to talk about comps, which are both essential and misunderstood. Especially on the Monterey Peninsula, where homes refuse to follow simple formulas.
Before buyers get too lost in the numbers, it helps to understand what comps really are, how they work, and how a good agent turns imperfect data into confident guidance.
What a Comp Really Is
(And What It Is Not)
A comp is short for “comparable sale.” In theory, it is a home similar to the one you are considering. In practice, it is a reference point. A clue. A guidepost. Never a verdict.
Buyers sometimes think of comps the way students think of a rubric. Clean inputs, clean answers. If House A sold for X, then House B should sell for something close to X.
But on the Monterey Peninsula, this logic can lead you into the weeds quickly.
There are no rows of replicated floor plans. There are no neatly measured premiums for a slightly larger yard. A hundred-year-old cottage in Pacific Grove might have the same square footage as a mid-century home down the street, yet that fact alone tells you almost nothing.
Good comps are not perfect matches. They are pieces of a puzzle that will never fully resolve into a complete picture. The question is not whether comps will give you certainty. They will not. The question is whether you have an agent who knows how to read them in context.
What Makes a Good Comp
The Closer the Match, the Better the Signal
A good comp mirrors the property you want to buy in several ways.
A good comp shares:
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Similar location
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Similar lot dynamics
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Similar architectural era
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Similar condition
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Similar style
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Similar level of updates
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Similar light, privacy, and feel
On the Monterey Peninsula, this list is rarely satisfied. Two blocks can change the microclimate. One street can shift the ocean view enough to redefine value. A house that looks charming from the outside may hide aging plumbing or seismic surprises. A home perched above the dunes might experience wind differently than another home with the same views but different exposure.
Since perfection does not exist here, a good agent looks for clusters. If three or four homes in the past year share enough similarities, even loosely, they form a helpful pattern. If one outlier contradicts the pattern, an agent will explain why.
Buyers should not chase the perfect comp. They should look for the reasonable pattern. A home’s value is found not in a single sale but in a constellation of them.
Anchoring Yourself in Sold Properties
Why Closed Sales Matter
The best comps are closed sales. They represent what someone willingly paid. Sold homes reveal the relationship between list price and outcome. They show how long a home sat on the market. They can indicate whether the competition was strong or mild.
Closed sales are the backbone of valuation because they reflect reality. Real buyers. Real decisions. Real money.
If you look only at list prices, you are reading fiction. If you look at sold prices, you are reading history.
A good agent reads both.
Should Buyers Consider Active Listings?
Sometimes Yes, Sometimes No, and Here’s Why
Active homes tell a different story. They reveal what sellers hope to get, not what they will get. Yet active listings still matter because they shape buyer psychology.
Imagine a couple eyeing a Carmel cottage listed at 2.2 million. If a nearly identical cottage is sitting nearby at 2.8 million and getting no showings, the couple learns something important. The market does not care about the 2.8. A home that sits quietly on the market teaches as much as a home that sells quickly.
Actives are signals, but they must be interpreted cautiously.
Sold comps form the baseline.
Active comps reveal the competition.
A good agent knows which actives are meaningful and which are noise.
The Hardest Markets to Comp
Carmel by the Sea. Carmel Highlands. Pebble Beach. Big Sur. Even Pacific Grove to a degree.
These are not tract homes. There are no model matches. A house on one street can feel like a completely different world from a house two streets over.
Try comparing a historic Carmel cottage with exposed beams and layered gardens to a newly built modern home on a hill. Try comparing an ocean-bluff home in Big Sur to another home that claims ocean views but experiences entirely different wind, sun, and privacy. Try comparing two houses in Pebble Beach where both have fairway views yet one feels exposed and the other feels calm.
The Monterey Peninsula refuses to behave like other, more "standardized" markets.
Buyers who rely only on comps will feel confused. Buyers who rely on an agent who understands nuance will feel grounded.
How a Good Agent Reads Imperfect Data
This Is Where Experience Matters
In a market like ours, the numbers are only half the story. A good agent walks into a home and recognizes:
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how the light moves
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how the privacy feels
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how the neighbors influence peace or noise
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how the topography changes the way you use outdoor space
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how certain architectural details impact longevity
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how a home’s history shapes its perception
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how buyers respond emotionally to the floor plan
None of these variables show up in comps. Yet they influence value far more than buyers realize.
A seasoned agent blends objective data with lived experience. They know what buyers paid for last spring and why. They remember which homes received multiple offers and which ones did not, and they remember the circumstances that created that dynamic. They study the market long enough to understand the patterns behind the patterns.
This is why buyers should know the language of comps, but trust the translation to their agent.
An Example
A home in Carmel lists at 3.4 million. You love it. You want it. Yet the sold comps nearby show recent closings around 2.8 to 3.1 million.
On paper, the 3.4 makes no sense.
Then your agent walks you through the truth. The 2.8 had structural settling. The 3.1 had a kitchen that needed full renovation. The other homes had inferior lots or compromised privacy. Meanwhile, the home you love has a timeless floor plan, updated systems, and an orientation that avoids the afternoon winds.
When you compare one imperfect comp to another imperfect comp, you will misread value. When you compare the feeling and livability of the homes, the pieces fall into place.
A good agent is not trying to sell you anything. They are giving you the context you cannot find online.
How Will You Know You Are Not Paying Too Much?
Start With the Long View
People often fear overpaying. Yet on the Monterey Peninsula, there is a better question: Will this home hold or grow its value over time?
Over the past 5 to 10 years, Monterey County appreciation has remained steady, even in periods of national volatility. Desirable pockets of Carmel, Pebble Beach, Pacific Grove, and parts of Big Sur hold their value with unusual resilience. Limited inventory and high demand stabilize prices over the long term.
You might pay a small premium today to secure a home you truly want. When you look back five years from now, the premium nearly always shrinks in the rearview mirror. In some cases, it disappears entirely.
You are not evaluating a single moment in time. You are evaluating a long arc of ownership.
A good offer is whatever it reasonably takes to get the home you want, without becoming careless. A good agent will tell you that directly.
How to Make a Reasonable Offer
Ask the Right Questions
When the comps are imperfect, buyers should ask their agent:
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Which sold homes matter most here and why?
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How does this home compare in condition, lot quality, and privacy?
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What do you know about the seller’s motivation?
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What level of competition do you expect?
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How rare is this property and how long might it take to find something similar?
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What concerns should we factor into our offer strategy?
These questions do not lead to an exact price. They lead to clarity.
Buyers should not aim for perfection. They should aim for confidence.
When Paying a Premium Makes Sense
Another Example
A couple searching in Pacific Grove falls in love with a Craftsman near the water. It is priced above recent comps. They hesitate. They worry about overpaying.
Their agent explains that this specific home has a deeper lot, better natural light, and quieter surroundings than the lower-priced sales. There were only two similar listings in the past year. Both had heavy competition.
The couple decides to offer a bit higher than they planned. They win the home. Two years later, they hear that an almost identical home around the corner sold for nearly the same premium they paid. They realize something important. They did not overpay. They simply understood value early.
Comps cannot teach you this. An experienced agent can.
How Buyers Can Stay Grounded
Learn the Language, Trust the Interpretation
Buyers feel more confident when they understand at least the basics.
You should understand:
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the difference between sold and active
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what makes a comp relevant
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how time on market influences pricing
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why list price often has nothing to do with value
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how emotional appeal shifts competition
But you should rely on your agent for the deeper analysis. Not because buyers are not capable, but because the Monterey Peninsula requires fluency in a market where every home is a singular event.
Learn the language. Trust the translation.
Why the Monterey Peninsula Demands a Different Approach
And Why The Ruiz Group Treats Value With Respect
Here, real estate is not a spreadsheet. It is a landscape of rare properties, layered histories, and micro-environments that only make sense when lived with for decades.
Anyone can pull comps. Anyone can present numbers.
The challenge is interpreting them correctly.
At The Ruiz Group, we believe in giving buyers the full picture. Not just what sold, but why it sold. Not just what a home is listed for, but what it represents. Buyers deserve clarity. They deserve honesty. They deserve context that respects both the data and the lived reality of our region.
This market rewards those who understand nuance. Our job is to guide you through that nuance so you can make decisions that feel informed and confident.
The Goal Is Not to Guess the Perfect Price
The Goal Is to Make a Confident Decision
The Monterey Peninsula will never be a market where comps line up neatly. That is part of its charm. It is part of its challenge.
It is also what makes a good agent invaluable.
A reasonable offer is rarely about hitting a target number. It is about understanding the circumstances, interpreting the clues, and reading both the competition and the seller’s posture. When you approach comps this way, the fear of overpaying softens. What remains is a clearer view of what matters most. The home itself. The long-term appreciation. The life you want to live in that space.
Comps are not about finding certainty. They are about building confidence.
And with the right guidance, that confidence is entirely within reach.
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