A CMA is one of the most important tools you can utilize when it comes to deciding whether or not to sell your home. Any agent can create a CMA for you, but there is some subjectivity when it comes to giving you an accurate idea of your current financial position.
So what is a CMA? A CMA is a comparative market analysis or a statement of the financial position of your home in the current market place that is fact-based. What do you mean “fact-based”? Well let’s be honest… most people know that you can go to certain real estate websites and see what they think the value of your home is. The website may use an algorithm or math equation to determine what they think the value is in relation to the national housing market. Unfortunately for those websites, there is a ton of variation across the nation when it comes to the strength or weakness of a local market. We actually get this question a lot from our clients. In most cases, the CMA we share with our clients reflects a different value than those values they have seen.
So what gives? This is where “fact-based” analysis becomes important. Many of these websites are only as good as the data that is input for use in their algorithm. A local realtor’s CMA is much more insightful because they are comparing your home with real-time data of the most recent transactions in your area that are similar to your home. So rather than speculation based on a broad-reaching algorithm, a CMA will tell you what similar buyers have paid for a house that was like yours in recent days or weeks.
So why are we talking about this? We have seen discrepancies between leading real estate website values and CMA values be tens of thousands of dollars on an average-priced home (we aren’t talking about multi-million dollar homes, but average homes in average neighborhoods). For most people, the difference of a few thousand dollars could completely change someones decision to sell their home. A CMA is more local, more accurate, and a better tool to help you when it comes to making decisions about your financial future.
The expertise of the agent can also give you a competitive advantage, as well. For example, our agents will go one step further than just providing you with a CMA, we will use this data and our insight regarding your goals and help you determine your threshold for risk. Specifically, we will find out what your goals are and help you determine how aggressive you need be when creating a sales strategy. Maybe your home is worth somewhere between $250,000 and $270,000. If you need to be in another city next month and $250,000 aligns with your goals then you will want to be really aggressive. If you have time to be patient, it may take longer, but you could potentially wait for an offer at the higher end of the value range.
Lastly, please don’t let an agent con you in to paying for a CMA. The tools and resources they use to compile this information are free and this service should be to you as well. If your agent is trying to charge you, you will want to move on smartly. This is a great opportunity to call us!