What is a comparative market analysis?

A comparative market analysis (CMA) is a tool used in real estate to determine the market value of a property by comparing it to similar properties that have recently sold or are currently listed for sale in the same area. The CMA is typically prepared by a real estate agent and is used to help sellers set an appropriate listing price for their property and to help buyers determine a reasonable offer price.

The process of preparing a CMA involves gathering information on recently sold properties, currently listed properties, and properties that were listed but did not sell. The properties used for comparison should have similar features and characteristics to the subject property, such as location, size, age, condition, and amenities. The real estate agent then analyzes the data to identify trends in the local market and to estimate the fair market value of the subject property.

The CMA report typically includes a list of comparable properties, along with their characteristics and recent sale or listing prices. The report may also include a summary of local market trends and conditions, and an analysis of the subject property’s strengths and weaknesses in relation to the competition.

A well-prepared CMA can provide valuable information for both buyers and sellers, helping them to make informed decisions about pricing and negotiating real estate transactions.