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A Comparable Market Analysis (CMA) can be done for a seller or a buyer. For a seller it is typically done to determine what the best price will be to market the property for sale. A CMA for the buyer is typically done to help the buyer determine what price they might be willing to offer and ultimately pay for the property. |
The most common method of determining a price for a house is the Comparable Market Analysis (CMA). A CMA will show exactly what properties that are similar to your house have sold for within a recent time frame. These analyses are based on fact, rather than opinion, and that information will always be of more value to you. Generally, CMA's will list houses in a particular location that are currently on the market, have sales pending on them, have expired from the market, and have sold. Be forewarned: it is primarily the SOLD properties that you need to be concerned with. What houses are listed for on the market is not always a good indication of what their value is, those that have pending sales will only tell you what the listing price is (not what it is going to sell for), and those that have expired because they haven't sold may indicate that they didn't move because they were overpriced.
If you are in the process of choosing an Agent, they should, as part of their listing presentation or buyer agent interview, develop and share a CMA for the seller or provide the buyer one when it comes time to make an offer. In addition, if the Agent is familiar with the neighborhood, they may be able to add some insight beyond just the numbers on the CMA sheet. For example, the CMA may show that the average sold price in the last year for houses similar to yours is $130,000, but the average of the houses sold in the last 2 months is $134,000, indicating an increase in market value.
What is the difference between market value and appraised value?
Appraised value is a certified appraiser's opinion of the worth of a home at a given point in time. Lenders require appraisals as part of the loan application process; fees range from $250 to $350.
Market value is what price the house will bring at a given point in time. A comparative market analysis is an informal estimate of market value, based on sales of comparable properties, performed by a real estate agent or broker.
Sellers, DO NOT use a refinance appraisal, equity line or second mortgage appraisal to establish a price to sell your home yourself!! Those appraisals many times do not reflect true market value.
Work with a Buyer Agent to find your next home!
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