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What
is my home worth? Request a free CMA! |
A Comparative Market
Analysis, also known in the industry as a CMA,
is a special report prepared by your Realtor, It's used to
estimate a home's realistic market price or value on the local
real estate market. Although the format varies with
each company and from agent to agent, a CMA typically
includes:
- A review of comparable
properties in the immediate area that are currently on the
market.
- The number of bedrooms and
bathrooms, lot size, architectural style, square footage,
special features, These include items such as: a swimming pool, spa,
panoramic city, mountain or ocean view, year built,
location, asking price and number of days on the
market.
- A review of
comparable homes currently under contract (in escrow)
with all available pricing information.
- A review of comparable
properties that have closed in the past 6 months, with
final selling price.
The key to remember about a CMA
- If properly researched, it will give you the hard
numbers necessary to reach a realistic pricing decision. The
price range you get from an agent using a CMA may well be lower
than you get from agents who don't use one. However, the odds
are strong that your house will actually sell within the CMA's
suggested range rather than at the higher price. And it will sell quicker, because the CMA emphasizes market reality, not
the upper limit sales price many of us prefer to hear.
What about
cost?
The big advantage of a comparative market analyses
(or "comps") is that they are free, unlike
appraisals which can cost several hundred dollars without any
assurance that they are more accurate.
Have you ever wondered why the
market value of your house differs from your lender's assessment? And what values
are being used to set and/or
increase your property tax bill? It's easy to be confused
about the different valuations being used in the home buying
and selling process. Knowing a home's value or worth in
the real estate market will help you get a fair sales price.
There are generally three ways
to determine the value of a home:
-
Comparative Market Analysis,
-
A Professional Appraisal
-
An Assessed Valuation.
A Comparative Market Analysis
(CMA), performed by an experienced Realtor like myself, can
determine a reasonable listing price for your home. When I
prepare a CMA, I consider a number of factors. These include the
home's size, age, location and amenities. I also research the
list prices of properties that are currently for sale. Also,
those that have
recently sold or expired in your neighborhood.
An appraiser (used by a lender)
determines the market value of your property by looking at the
supply and demand of like properties in the area. They compare
your property with others that have recently sold. This helps
them determine
the amount of money it would take to replace your home at current material and labor costs. It's also used to
determine how
much income a property would produce - (this last approach is
used more often for rental property, apartments and commercial
property). Lenders frequently require a professional appraisal
upon which to base your loan amount. Local governments also perform
independent appraisals to gauge your home's assessed valuation
for fair property
tax.
When comparing the CMA and the
appraised values, don't be surprised if they do not match.
There are a number of reasons that these differences occur.
The "market value"
determined by the appraisal can be different from the
"market price" determined through a CMA. In
essence, the appraisal amount reflects the cost of replacing
your home. But the goal of the CMA is to determine a price
that someone will pay for your house. The sale price can be
much different from the appraisal value, especially if there
are multiple offers on the property..
I can help you determine your
home's worth by researching it history and performing a Comparative
Market Analysis. I can also recommend professional
appraisers if needed. Please call me to discuss the current real estate conditions that affect the
market price of your property. Please call or e-mail me for more information on receiving a free
"Market Analysis" of your property. If you are
interested in listing your home for sale, visit this new web
page here.
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