Monday, March 10, 2008

Is a "free" CMA worth the price?

One way to estimate the current value of your home is to have a real estate agent prepare a CMA, which stands for “Comprehensive (or Comparable) Market Analysis”. It is similar to an appraisal in that it helps you determine the market value of your home by comparing it to others currently on the market or recently sold. These homes are commonly referred to as “comps.”

Once upon a time, agents charged a hefty fee for preparing a CMA for potential clients. Eventually, it became common practice for agents to provide this service free of charge as a way of winning clients. However, the amount of time and effort an agent invests in this research can vary widely, and can significantly affect the validity of the results.

Following are some questions to ask when reviewing a CMA:
· What criterion did you use for your comps? Are you comparing apples to apples?
· Did you personally visit any/all of the active listings, or merely view them online?
· How similar to mine is the condition of the homes you used as comps?
· Does your research include active, pending and sold homes (i.e. all three categories)?
· Are current market conditions comparable to the time frame you researched?
· Which home(s) do you believe to be my biggest competition?
· How long do you think it will take to sell my home at the price you are recommending?

So, to answer the question I posed in the title of this article, a "free" CMA can be worth several hundred dollars if it is done diligently, or it can be worth what you paid for it -- nothing. If you ask the questions I posed above, you will know which you are getting.

Call me today to schedule a thoroughly-researched and accurate CMA of your home. 206-708-9800

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