This term you hear thrown around the real estate industry…CMA…but what does it really mean, and what goes into determining a Comparable Market Analysis anyway?
No two homes are identical, which is why choosing a sales price, or offer price, can be challenging. That’s where the comparable market analysis, or CMA, can be useful.
The CMA is a side-by-side comparison of homes for sale and homes that have recently sold in the same neighborhood and price range. This information is further sorted by data fields such as; single-family or condo, number of bedrooms, number of baths, zip codes, and many other factors. Its purpose is to show fair market value, based on what other buyers and sellers have determined through past sales, pending sales and homes recently put on the market.
CMAs are generated by a computer program supplied by your real estate agent’s multiple listing service (MLS). The MLS is available to licensed members only, including brokers, salespeople, and appraisers, who pay dues to gain access to the service’s public and proprietary data, including tax roll information, sold transactions, and listings input by all cooperating MLS members.
Listing agents generate CMAs for their sellers, and buyer’s agents create them for their buyers. This way, both sides know what current market conditions are for the homes they’re interested in comparing.
How accurate are CMAs?
The CMA is a here-and-now snapshot of the market, based on the most recent data available, but it can instantly be rendered obsolete by a new listing, or a change of status in a home with the same criteria. Why? The market is constantly changing – new listings, pending sales, closed sales, price reductions, and expired listings happen every day.
- Active listings
- Pending listings
- Sold listings
- Off market/Withdrawn/Cancelled listings
- Expired listings
Some things to compare when looking at other listings:
- Homes with similar square footage
- Homes with similar age of construction
- Homes with similar ammenities and upgrades
- Homes with similar condition as yours
- Homes in the same area or location
CMAs can vary widely, depending on the knowledge and skill of the person inputting the search parameters to the software, as well as the number and type of data fields that are chosen. That means some features may not be included.
As informative as the CMA is, it should only be used as a tool, and should not substitute for your real estate professional’s knowledge and advice.
To determine your Comparative Market Analysis, lets get started today, we just need an address!
Use our quick and easy site to get an instant value for your home! For a more accurate value, or to talk about getting your home on the market, give us a call at 916-405-5737 today!