Comparative Market Analysis (CMA)
Before listing your home, we recommend allowing us to complete a comparative market analysis, or CMA, for your home. The CMA is a great tool that will give you a better understanding of what your price point should be.
Included in the CMA are:
Active Listings – homes currently for sale. This is your competition.
Pending Listings – homes that are under contract. The pending sale shows what the house was listed it, at not what it sold for however, pending sales do indicate the direction the market is going. If you price your home above the list price of these homes you could face longer days on the market.
Sold Listings – homes that have sold typically in the last 6 months. These are the homes that appraisers use as comparable properties when appraising your home. This is important to note as they are the most representative of your market value.
Things to consider when examining the sold listings on your CMA:
- Similar square footage - Appraisers compare homes based on square footage. Larger square-foot homes are worth less per square foot than smaller square-foot homes. The variance among a group of median-priced homes ideally should not exceed more than 200 to 400 square feet, plus or minus.
- Similar age of construction - Ideally, the age of the home -- the year it was built -- should be within a few years of other comparable sold homes. Mixed-age subdivisions are common. If your home was built in 1980, say, and brand new homes up the street are selling for more, you cannot command the same price as a new home.
- Similar amenities, upgrades and condition - Appraisers will deduct value from your home if other homes have upgrades and yours does not. A home with a swimming pool will have a different value than a home without a pool. A completely remodeled home is worth more than a fixer. Homes with one bath are worth less than homes with two or more baths.
- Location - Everybody knows that real estate is valued on "location, location, location," but have you considered what that means? A home with a view of the city, for example, is worth more than a home facing a cement wall. Homes located on busy thoroughfares are worth considerably less than homes on quiet streets. Compare your home to those in similar locations. If your home sits across the street from a power plant, look for other homes with power plant exposure or those located along railroad tracks, among other undesirable locations.