What is Comparative Market Analysis

Real estate agents use Comparative Market Analysis to estimate the value of a home by comparing it to similar properties recently sold in the same region. When individuals evaluate the elements that influence the price of a home. They often consider location, square footage, and the number of bedrooms and bathrooms. However, the age, condition, characteristics, lot size, and so on of the property, as well as the needs of the local and national markets, all impact the value of the residential real estate.

How CMA works

Agents do the study by looking for recently sold properties in the same region that are as close to the subject property as feasible. These residences, known as comps or comparable sales, are priced using a sales comparison technique. This method is based on the assumption that you can determine the value of a property by determining how much it would cost to buy a comparable home of equal attractiveness.

Example of Comparative Market Analysis

If the market is hot or inventory is low, the price may be slightly higher. If several identical properties are on the market, the price may drop to be competitive.

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