What is CMA: Comparative Market Analysis or Market Valuation?

| April 17, 2018 | 0 Comments | Bristow Biz

Belinda Jacobson-Loehle

By All Things Writing

A house a few streets over from your home just sold for $550K, so it’s pretty likely that your home will sell for a similar price point, right?

“Maybe, but maybe not,” said Belinda Jacobson Loehle, Owner and Broker for Jacobson Realty and Home Staging. Homeowners need to know something about the market in their area and why homes in one neighborhood may sell for a higher or lower price point than a comparable home in another area.

“Your real estate professional will complete a comparative market analysis (CMA) right before your home goes onto the market. A CMA will provide you information about homes that are similar to yours (in size, amenities and location) that are either on the market, have sold or were listed but expired within the past three months. These comparisons help determine where to position your home’s list price in order to get the best sales price for your home,” said Jacobson Loehle.

Many homeowners check their home’s worth using online real estate platforms like Zillow or Realtor.com prior to contacting an agent.

“Those automated valuation models (AVM’s) are a great starting point. However, they don’t take into account current real estate market trends or your realtor’s knowledge of the location. Often, AVM valuations can be too high or too low,” said Jacobson Loehle.

You realtor will focus on three key areas when preparing your CMA according to Jacobson Loehle:

  1. Location – Location is always the most important factor. Is your home located on a busy street or does it sit at the end of a cul-de-sac? What is your home’s proximity to amenities like schools and parks? Does your home back to trees, a golf course, lake or pond? Does it have significant curb appeal? All of these features may add value and be included in the CMA report. Your realtor will want to choose homes with similar site features.
  2. Interior features –  Some of the key interior features your realtor will assess are total square footage, number of bedrooms and number of bathrooms that are in your home. Do you have a basement, and is it fully or partially finished? Does the basement have windows and natural lighting, making it habitable or is it intended for storage? The type of ingress and egress your basement has is also important. Do you have a true walkout basement, or is it a walk-up basement or in-ground? Regardless of the type, style and finishing details your basement has, it will add to the overall square footage of your home. All of these are important when preparing a CMA.
  3. Exterior features – Decks, patios, gazebos, add-ons, side-load versus front-load garages, hardscape and landscaping are all exterior features that your realtor will consider as part of their analysis. Outside masonry like a fireplace, pizza oven or grill, fountains and even a koi pond may add value to your home assessment. The condition of your siding, windows and roof are also taken into consideration, but  they are typically used to evaluate overall condition more than value.

“There are a lot of other factors to be considered in valuing your property. Preparing a good Comparative Market Analysis takes time and requires an understanding of the marketplace and area trends. This professionally researched report from a knowledgeable local realtor will give you a well-rounded portrait of your home and neighborhood, including a confident listing strategy,” said Belinda Jacobson-Loehle.

For all your real estate needs, please contact Belinda Jacobson-Loehle at Jacobson Realty and Home Staging today.

Sign up now for a FREE copy of my eBook, “The Real Estate Key – What You Need to Know!”

© 2018, Bristow Beat. All rights reserved.

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