Understanding the Benefits of a Comparative Market Analysis

By Fran Campbell - May 08, 2018

Knowing the current market value of your home is most important when thinking of selling, especially if the proceeds of the sale are needed to purchase another home. When planning to sell a home, obtaining a reliable and comprehensive “Market Analysis Report” is a very important consideration for homeowners. There are many benefits this report offers to both buyers and sellers and we'll share some of those with you. But first, let's take a look at what a comparative market analysis is.

What is a CMA?
A comparative market analysis is an examination of the prices at which similar properties in the same area recently sold. Real estate agents perform a comparative market analysis for their clients to help them determine a price to list when selling a home or a price to offer when buying a home. Since no two properties are identical, agents make adjustments for the differences between the sold properties and the one that is about to be purchased or listed to determine a fair offer or sale price. Essentially, a comparative market analysis is a less-sophisticated version of a formal, professional appraisal.

While the comparative market analysis is not an official appraisal, the real estate agent uses a great deal of similar practices and methods that an appraiser would use to arrive at a reasonable value for the property. If the home or property is so distinctive or unique that there are no comparable properties found, it may be in the best interest of the owner to hire a formal appraiser to value the property. That being said, let's take a look at some of the benefits of a CMA.

Highlights Any Room for Improvement
Studies show that improvements such as renovated bathrooms or updated kitchens can increase property value by up to 8.7%. Investing a few thousand dollars on the front end could help you not only sell your home quickly, but could help to draw in higher offers than if you ignored the upgrade. Since a CMA considers amenities such as full/half bathrooms, new appliances, garage sizes and additional upgrades, a comprehensive market analysis will shed light upon areas that can be improved and potentially increase value.

Sets a Reasonable Price Expectation
While you may have a ideal number in your mind of what you'd like to get for your home, it may not be a number that the current market can bare. Comparative Market Analyses can provide a realistic view of where the home should be priced, based upon the key data points reviewed. The last thing you want as a seller is to set the price too high, and not get any offers or receive what you feel are very low offers. By looking at realistic comparable properties, experienced agents can present a fair price that meets the current market demands, thus moving your home quickly through the purchasing process.

Provides Pertinent Information to Serious Buyers
A CMA helps buyers differentiate unique aspects of a property so it can be compared with other potential properties in the immediate area. By weighing price, amenities, location and other variables, the buyer is more informed and able to compare multiple factors involved in the purchase to help aid in their decision making. The more informed a buyer is, the more comfortable they'll feel about putting in an offer.

Now that you know what a comparative marketing analysis is and the benefits of getting this done, you'll be more prepared to list your home for sale confidently or to put in an offer on a home and feel confident with your offer! The Fran Campbell Team provides superior service to our clients by demonstrating the highest standard of negotiation, communication, integrity and professionalism. Our pledge is to go above and beyond our client's expectations. Contact the best real estate team at the Lake of the Ozarks to get your home sold!

Contact the Fran Campbell Team to get your home SOLD!