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Home Value Comparative Market Analysis 

What is a Comparative Market Analysis (CMA).  

Before selling or buying a home, it is vital that you know the home’s true market value in today’s ever-changing real estate market. A Comparative Market Analysis (CMA) is an evaluation of similar, recently sold homes (called comparable or comps) that are near a home or homes that you want to buy or sell. Buyers, sellers, or real estate agents perform a CMA report to establish and find a fair price range for the home the report is created for. The price range from the CMA can then be used as a guide to be used for establishing an offer price or a listing price. 

Performing a CMA involves finding the homes that are similar to the home under consideration, and creating an in-depth comparison of its size, age, location, and features of the home. It all comes down to one question: compared to other, comparable homes in this area, how much is this home worth? Answering that question involves looking at a fair amount of data on other homes in the current market. 

The Process of Comparative Market Analysis:

The process for doing a comparative market analysis includes:

Defining Criteria For Selecting Comparable:

• Determine a list of quality comparable. 
• Evaluate the comparable within close range to the home. 
• Adjust comparable values for differences in size, condition, location, amenities, etc. 
• Estimate the ideal value of your target home based off the findings. 

The Value of Your Home 

In a neighborhood of similar homes, why is one home worth more than the other? Because every home is different. When a home is sold, a willing seller and a willing buyer have just announced to the World the value of that home. From there, other similar homes are bench-marked, but other factors come into play. The most important value factors are as follows: 

The Location of the House 

Everyone has heard the phrase “location, location, location!” The reason being, it truly is the number one reason for a home being higher in value, or less in value. The closer a home is to jobs, parks, transportation, schools, shopping, entertainment and community services, the more desirable a home is. In contrast, if a home is poorly located, such as backing up to a busy road, or situated right next to big power lines, or near an industrial area, the home value drops. Value adjustment within a CMA is critical when it comes to a location issue. Hence, “location, location, location.” 

The Condition of the Property  

The condition of a property is key in keeping the investment of your home at its highest value. A home kept in pristine condition will always have higher value than a home that was not maintained over the years as well. Additionally, the closer a home is to new construction, the more it will retain its value. It is perceived as more modern and up to date. Value adjustment within a CMA would be needed when condition is an issue. 

The Size of The Home 

The size of a home and the number of bedrooms and bathrooms increases the value of a property. Clearly a bigger home will have higher value than a smaller home in the same neighborhood that has less square footage, less bedrooms, less bathrooms. The Comparative Market Analysis derives these stats directly from the MLS.  

Important Features and Major Upgrades 

If you compare two homes similar in location, size, and condition, then “other amenities” will be the determining factors if one is higher in value than the other. Amenities such as a pool, basketball court, remodeled kitchen or baths, outdoor kitchen or BBQ, or larger lot, etc. 

When two homes are identical in the same neighborhood, a higher price may come down to something as simple as views, or paint colors, or the overall taste of the homeowner. Therefore, valuing a home will never be an exact science. However, if a homeowner keeps the property updated and in good repair, the home should recoup most, if not all, of the homeowner’s investment.

Are You Thinking About Selling Your Home? 

If you are, you won’t want to sell it for anything less than fair market value (FMV). On the other hand, by setting a listing price higher than what is realistic might be a mistake that results in a home that doesn’t sell.

Before putting your home on the market it is important to first have an estimate of the value. This can be accomplished by having an experienced real estate agent provide you with a Comparative Market Analysis (CMA). This market analysis will provide the information that will help you sell your home for the most amount of money in the least amount of time.

Contact Us

Please provide us with some information about your property so that Faruk Bhuiyan top Realtor in Los Angeles can help determine its value. We’ll also include comparable sales in the area, recent sales data, and more. We’ll also include a suggested list price and any available recent sales data, so you can make sure your asking price is within reason for the current market. To get started, simply fill out the form above. Call/Text Faruk at (562) 213-8892 For a FREE Comparative Market Analysis.