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What is a CMA and Why Do You Need One?
CMA is real estate shorthand for “Comparative Market Analysis”. A CMA is a report prepared by a real estate agent providing data comparing your property to similar properties in the marketplace.
The first thing an agent will need to do to provide you with a CMA is to inspect your property. Generally, this inspection won’t be overly detailed nor does the house need to be in a totally cleaned state. It should be in such a condition that the agent will be able to make an accurate assessment of its condition and worth. If you plan to make changes before selling, inform the agent at this time.
The next step is for the agent to obtain data on comparable properties. This data is usually available through the MLS and/or other means of interpreting market price. A qualified agent will also know of properties that are on the market or have sold without being part of the MLS. Please note that the CMA is not an appraisal. An appraisal must be performed by a licensed appraiser.
The CMA process takes place before your home is listed for sale and provides a good assessment of what your home could potentially sell for.
CMAs are not only for prospective sellers. Buyers should consider requesting a CMA for properties they are seriously looking at to determine whether the asking price is a true reflection of the current market. Owners who are upgrading or remodeling can benefit from a CMA when it’s used to see if the intended changes will “over-improve” their property compared to others in the neighborhood.
