The CMA is used daily in our real estate world. Whether working with investors and researching the would be rentals to find out what sort of income can be made or simply searching for a seller to find out what the expected price is of the home the CMA tool is invaluable. Agents use this when working with sellers to determine a listing price or with buyers to check value before offers to purchase, real estate agents do what is known as a comparative market analysis, or CMA.
By going to sold property records, the real estate professional selects recently sold properties that are similar to the subject property and in the same area. By comparing these properties, and adjusting for feature differences, an estimate of value is made for the subject property.
A thorough CMA would also include comparison to currently listed similar properties in the area. This would allow an assessment of the current competition and might lead to an increase or decrease in the estimate based on the sold properties.
This can also be used to do tax appeals when it comes up time for your city to give you the opportunity. Getting with an agent and having them run off a CMA for you will aid to your benefit in showing the difference in the value of property today compared to the value when it was last assessed. This could result in a lower tax bill.
This market analysis tool is invaluable and is one of the first tasks that should be taught to a new agent as well as one of the first things a new buyer or seller should ask to see!!
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