A CMA or Comparative Market Analysis is a report prepared by a real estate agent to help a prospective buyer or seller understand the fair market value of a home.
The CMA provides a client with current market conditions, where the real estate market is headed and comparable homes that have recently sold in the area to provide the most likely sake price of a home.
What Makes A Comparable Home In A CMA?
The crux of a CMA report is comparable homes or “comps” as real estate agents like to call them. These are homes that are most similar to the subject property that have recently sold.
Recency- Comparable homes should have sold within the past 3-6 months and no longer.
Size- The comps in your CMA should include similar-sized homes. No more than 20% +/- the subject home.
Room, Bedroom and Bath Counts- Ideally your comps should be of similar room bedroom and bath counts to your subject property.
Location- When at all possible it is best if your comparable homes are within a mile of the subject property. If not, they should be at least of a similar location.
Style and Age- Homes that are compared to the subject property should be of the same style and of similar age. You should compare colonials to colonials and capes to capes. Bear in mind a 50’s colonial will function very differently than a new construction colonials
Function and Appeal- It boils down to whether the comps have a similar function and appeal to the subject property. Would a buyer substitute one of the comps for the subject home if the subject home was not available?
What your house is worth is based on data and not an arbitrary number pulled out of the air. Review your CMA with your agent and understand the comps and the data.