HOW TO DO CMAs WELL
Competitive Market Analysis involves evaluating similar properties to the one you are trying to sell and comparing their estimated value to your property. Here are helpful resources for calculating a fair CMA.
The local Multiple Listing Service can help you determine an estimated market value for your property by finding what similar homes have sold for in the area of your subject property. Hopefully, you can find around 10 properties or so to compare.
Quick MLS tips for CMA:
Age of the home should be within +/- 5 years of the age of your property.
Compare with equal number of stories, bedrooms and bathrooms and type of garage space and construction.
Pools often do not add much value. You can check tax records and also compare to homes with or without pools according to the compared property.
Set the square feet filter to within +/- 10% of your property’s square footage.
Stay within the same neighborhood as my subject property, if possible. If this does not give enough results, extend to a half-mile radius from the neighborhood of your subject property.
Set Listing Age filter to 6 months to ensure that the market has not changed much since the comp was listed for that price. If absolutely needed, broaden your search to 360 days and keep in mind if the market has changed since then.
Note acreage, if necessary.
Look at Sold prices first. Note the average price per square foot of the comps you’ve found and then look at each of these properties photos to compare the condition of the homes against one another. I usually rate each property according to their photos by writing a note that says, “Very Nice/Renovated,” “Average” or “Not Nice/Needs Update.” Know that larger square footage homes have a lower price per square foot. You can find that average by looking at properties of similar square footage. Lastly, you can choose to compare these with the price range you see on RPR for a reference although that is not always reliable.
If the house has been newly renovated, you will want to look closely at the images of your comparable properties to ensure that it has the same level of updates to make an accurate comparison.
Again, you will want to look closely at the images of your comparable properties to ensure they have the same level of updates (or lack thereof) to make an accurate comparison. It is good to see these types of homes in person to determine if there are any problems with the foundation or roof. Note that RPR does not have the ability to know about any structural integrity issues.
Out Of City Limits
It is often hard to find appropriate comparables if a property is outside of city limits as many factors can vary so much. Sometimes you will find properties with a large acreage in an regular subdivision. If so, remove the acreage filter to get a better feel for the value of the house itself. Checking values on tax records helps sometimes, too.
Realtors Property Resource (RPR)
The RPR system is free to real estate agents through the Multiple Listing Service (MLS) and provides an estimated range of guessed value of a property.
Tax records are not going to give you the market value of the home, but they can help you get a starting value range when used with RPR.