So you are in the market to buy or sell a home and you begin by looking on the internet at some of the many real estate websites and you discover that many places are offering to evaluate your home’s value for free. Most real estate firms offer to do what is called a CMA, or, Comparative Marketing Analysis. A comparative marketing analysis is a tool used to determine the value of a home. Real estate agents perform a comparative market analysis for their clients to help them determine a price to list when selling a home or a price to offer when buying a home. They are very helpful in determining this but there are some things that a CMA is not.
A CMA is not an appraisal...A home appraisal is an unbiased report on the worth of a house in the fair market, performed by a trained and licensed individual. A CMA is an examination of the prices at which similar properties in the same area recently sold. Real estate agents perform a comparative market analysis for their clients to help them determine a price to list when selling a home or a price to offer when buying a home.
A CMA is NOT comps based solely on price per square foot (factoring in ONLY square footage)...The main use of prices per square foot is important is to show you trends. If you can compare the average price per square foot for the past 12 months, you can determine whether values are rising or falling. But much of that depends on the average size of the home. The pricing per square foot simply gives you average or median ranges; it shows you trends. In most cases, it does not accurately compute the value.
A CMA is not an exact science...It merely gives a probable value of a subject property based on what other similar properties have sold for, with adjustments made for differences. Home prices are still variable and the market fluctuates up and down to a degree so a price given even a six months ago could be much different now.
A CMA for one particular area of town or neighborhood is not going to be applicable to another area of town or location...You should have a separate CMA done for each location.
A CMA is not expensive...In most cases a CMA is free and really should be free. It is a tool, a resource for realtors to assist clients and should be used for such. Another note on this: A CMA does not obligate you to work with any realtor, in other words, if you have a CMA done it does not mean you have to work with that particular realtor. There are literally thousands of home evaluation websites online to choose from, mainly all free. If an agent is trying to charge you a large sum to do a CMA? Simply move on!
Here at Dominion Coast & Valley Real Estate LLC I do all my comparative marketing analysis at no charge and never will! If you have a need for a CMA or are just curious what your home may be worth click here find out this important information.