What is a Comparative Market Analysis?

A Comparative Market Analysis (CMA) is an estimate of a home’s value that is based on recently sold similar properties in the same area. CMA helps home sellers set reasonable listing prices and it also helps buyers make competitive offers when bidding for their target homes.

Listing sites such as Zillow rely on online data and algorithms to come up with an estimated home value. However, the Zillow “zestimate” value of your home might not be accurate since there is no physical walk-through or neighborhood assessment that has been conducted.

That’s where a professional real estate agent comes in to help you get a realistic CMA home value report that is based on both physical valuation and available market online data. As an experienced realtor with EXP Realty, I will help you get the actual value of your home to enable you to get more offers when you list your home for sale.

A physical walk-through helps the agent evaluate the current condition of your home and also the type of upgrades recently done. The data gathered is used to make a comparison of what other similar homes in the same neighborhood have to offer. This is what the agent will use to generate a realistic Comparative Market Analysis (CMA) report that can accurately estimate your home value.

How is Comparative Market Analysis conducted?

Here is a step-by-step process that a real estate agent follows to conduct a

Comparative Market Analysis (CMA) for your home.

a) Assess the neighborhood- The agent start by analyzing the location where your home is situated. How attractive is the neighborhood? What kind of community amenities are there? How about the area accessibility?

b) Details about subject property- Your agent will make a physical inspection of your home and assess key areas plus major upgrades to understand what your home has to offer. Key property details such as home size, space, age, building type/style, floor-plan layout, finishes, and landscaping.

c) Finding comparable properties- The agent then selects three or five recently sold homes that have similar properties in the same neighborhood and compares prices. The more similarity in terms of features the better. A more recent sale data is also more accurate because property prices keep on fluctuating as dictated by the market forces.

d) Adjusting the differences- Once the agent gets the comparable data, what follows is to adjust for the differences between the subject home and each of the comparable properties. A professional agent will be able to assign value to each dollar difference and adjust the value of each comparable home. It’s important to understand that the value of the subject’s home is never adjusted.

e) Get the sold price per square foot after making the adjustments- When the agent makes the necessary difference adjustments, the next step is to divide the adjusted price of each comparable property by its square footage. Doing so will help you get the selling price per square foot. When you add all the selling prices per square feet of the comparable, you will then divide by the total number to get the average value. Once the agent gets the average value, he will multiply it by the square feet of your subject home to get its current fair market value.

When you engage an agent to help you set your home listing price correctly, you will be able to sell your home fast. That’s why a sound Comparative Market Analysis (CMA) is more than just a mere comparison of prices for similar homes that were recently sold in the same neighborhoods. For accurate home valuations, contact me at 305-204-3585. I am a professional real estate specialist from Avanti Way Reality and you will have an easier home selling process.

Jester Nino
Broker Associate
Oscar Teran Group | C5 | EXP Realty