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A Realtor’s Comparative Market Analysis (CMA) is a complex yet critical tool in the real estate business. It starts with evaluating your home vis-a-vis similar properties, or ‘comps’; taking into consideration aspects such as size, condition, location, age, amenities and so on. ‘Comps’ are the backbone of any CMA. Crafting a well-orchestrated CMA requires intimate knowledge of the market and exceptional attentiveness to details. Once the ‘comps’ have been identified, we begin our pricing analysis which includes:
1. Sold Listings: Recently sold homes in your area offer a concrete measure of what buyers are willing to pay. This is by far the most important number in the analysis and is crucial to pinpoint your home’s possible price tag.
2. Active Listings: These provide insights into current competition. These houses are not yet sold, but buyers will compare their prices to yours. Remember, this is only the price someone wants for their property; it doesn’t mean they will get the full asking price. It would be comparable to the sticker price on a new automobile. It does provide clarity on our competitive landscape, which helps us to formulate and emphasizes our strategic pricing.
3. Pending/Contingent Listings: Properties under contract but the sale is not yet finalized. This shows the listing price which attracted an offer; but not the offer itself. The actual sale price won’t be known until the transaction is finalized; but it does give us some insight into how the market is trending. It’s a very good guide telling us what the market is looking for and will bear.
4. Off-Market / Withdrawn / Cancelled / Expired Listings: These are homes taken off the market for several reasons. Learning from their experiences gives us a clear path of what not to do.
A comprehensive and precise CMA is the secret to unlocking your property’s best selling price. Remember, a CMA is not just numbers on a page; it’s the story of your home’s place on the market.
