Desert Dimensions Properties Owner and Designated Broker, Joe Maggiore, is typically mentoring agents, or out and about in the Valley, and he can be hard to ‘pin down.’ But today he gave some valuable time for this particular topic – some simple and straightforward answers to our Comparative Market Analysis (CMA) questions.
Thanks for sitting with me today, Joe. I’m hoping we can simplify the CMA concept for our readers. In your own words, please – what IS a Comparative Market Analysis?
Sure thing! A CMA is a snapshot of where your property sits with regards to value and sale potential, based on neighborhood data, through the analysis of area comps.
I see. And, how is a CMA helpful? Who would need it, and what would they need it for?
A CMA is most helpful for someone considering selling their property. It gives a good idea of value, but can also give suggestions for what work may need to be done to the home to sell for its highest potential.
A CMA can also be useful for someone considering refinancing or remodeling a home that they don’t plan to sell just yet. It can help a homeowner determine the possibility of refinancing, or how their remodel work could impact their home’s resale potential in the future.
As a homeowner, what does a CMA tell you? How is it different from an appraisal?
An appraisal is a great way to determine your property value based on what other homes in the area have sold for. A CMA, however, will typically also take into account other active properties in the area. It truly looks at the most recent market conditions in your neighborhood. So, a CMA is a valuation, but one based on active listings that can help you see the potential competition in your price range.
Interesting. What kind of data and information do you look for when you perform a CMA?
Hmm, there’s a wide range! At Desert Dimensions Properties, we start with a look at recently sold units, then active and pending ones too. This gives us a ‘base’ to work from, in terms of the specific area. Then we take into account the detail of the property itself – any upgrades, renovations and amenities that make it unique. Basically, ANYTHING that could affect the valuation of your home is part of the calculation – every factor helps us arrive at an accurate CMA.
Sounds like there’s a mysterious art to it! Which brings me to the next question – What are the most common mistakes you’ve seen Realtors make when they provide a CMA?
This is easy to answer – the biggest mistake I see is agents failing to look at the active properties. Most agents look at the sales data, but if you think about it, the other active listings are the properties that will imminently be the subject property’s competition. You have to think about what TODAY’S Buyer will be seeing.
Since we’re talking about the work involved, should CMAs cost money?
No, a CMA should not cost any money. It’s something that an experienced agent can produce as a tool for their client, or potential client, to have at their disposal when deciding how to handle their property in the future. It’s a fantastic relationship tool for an agent to use.
This has been fascinating, thanks Joe! Any final tips or advice on why, and when, to get a CMA?
Sadly, many people make large decisions for their lives with a lack of information. A CMA is something that a homeowner should seek out well before they think they need it. They should think of it as part of their research and information-gathering. It’s critical for homeowners to know an accurate number, even if it’s approximate, when considering their home’s value and how it might impact their future plans.
With this education and guidance from Joe, you’re now ready for YOUR personalized CMA from a Desert Dimensions Properties agent. We’re waiting for your call, at 480-270-5355 ☺ Want to learn more about getting the most out of your real estate? Read How to Identify Cash Flow Properties You’ll Love Investing In.