Which approach is most likely to involve an analysis of comparable sales in the valuation process?

The sales comparison approach is primarily focused on analyzing comparable sales to determine the value of a property. This method involves evaluating recent sales of similar properties in the same market area to derive a value estimate for the property being appraised. By comparing properties with similar characteristics—such as location, size, age, and condition—appraisers can adjust the sale prices of these comparable properties based on differences, which helps establish a more accurate valuation for the subject property.

For example, if a comparable property sold for a certain price, and the subject property has some significant differences (like a larger square footage or superior amenities), the appraiser will adjust the comparable sale price accordingly. This analysis is particularly useful in markets where there are abundant transaction data that provides a reliable basis for making comparisons.

In contrast, while the cost approach focuses on calculating the cost to replace or reproduce a property minus depreciation, and the income approach looks at the revenue-generating potential of a property, neither of these methods relies primarily on the analysis of comparable sales. Similarly, highest and best use analysis is a concept that determines the most profitable use of a property but does not directly involve sales comparison. Thus, the sales comparison approach stands out as the method that explicitly relies on comparing sales data.