Competitive Market Analysis
A Competitive Market Analysis or CMA is used by Realtors to estimate the value of a property under current market conditions. A CMA is a time sensitive assessment developed by looking at the subject property and the following other factors:
Comparable “For Sale” Listings
Current comparable listings are evaluated to determine what the available competition is in the marketplace. The more comparable properties for sale, the more competition there is for buyers.
Comparable “Sold” Listings
Recently sold properties give Realtors the best information when determining the value of a comparable property. The actual selling price of a comparable property tells us the strength of the market and the values that buyers are assigning to similar properties in your area.
Comparable “Expired” Listings
Property listings that have expired often tell us that a property is overpriced. Knowing this information helps us to establish the proper pricing for property from the beginning, allowing you the most buyer exposure in the critical first weeks of marketing.
Market Value and Price
What is market value?
Market value is defined by the courts as the highest price that a property will bring if offered for sale on the open market, allowing a reasonable time to find a purchaser who buys with knowledge of all the uses to which the property may be adapted and for which it is capable of being used for. Market value is commonly referred to as the price at which a seller is willing to sell and a buyer is willing to buy with neither being under undue pressure.
Determining Market Value
The selling price range for a home is based on the fact that a person will pay no more for a property than it would cost to purchase a comparable property. As experienced Realtors, we research and use current market data to compare your property with other similar properties in your area that have recently sold or are currently for sale. Because no two properties are exactly alike, determining any differences and making adjustments of price come with my professional opinion and experience.
Pricing Your Home
Pricing your home competitively with other similar-type properties in the market place is critical. A home realistically priced and properly marketed will give you the opportunity to obtain top dollar in the quickest amount of time. Buyers will look at an average of 15 homes when shopping for a home and your price must be comparable to other homes currently on the market or your chance of being overlooked is increased considerably. A home priced at market value has the greatest chance of being sold within a reasonable time frame.
The first several weeks that your home is on the market are the most critical. Pricing your home too high in comparison to the competition will keep buyers from purchasing or even looking at your property. An overpriced property can be overlooked in the initial marketing stage and when reduced, potential buyers may hesitate and question why the price was lowered, possible thinking there is something wrong with the property when there is not.