The Improvement And Application Of The Market Comparison Approach In Real Estate Assessment

Chinese real estate assessment approach mainly includes the market comparison approach, cost approach, income approach, the price of course approach and assuming that it has been developed approach. The most straightforward approach is the market comparison approach. It can reflect the real estate’s market price best. Therefore, the market comparison approach has recognized by the international evaluation field.In this article, firstly we expound the basic principle and evaluation steps of market comparison approach. Then we sum up the main problems in application of market comparison approach. We find two problems in this process. The first problem is that it is very casual when the appraisers select the case. The second problem is that it is very subjective when the appraisers correct the factors of the real estate.In order to solve these problems, this paper applies principal component analysis and analytic hierarchy process (AHP) in the real estate appraisal. We establish principal component analysis model and the hierarchical analysis model to solve these problems. At last we demonstrate the application of the improved market comparison approach with the actual case. We hope that the improved market comparison approach can be applied to the actual assessment so that the market comparison approach can serve to the evaluate industry better.