Many persons would be confused if tasked with pricing their home before putting it up for sale. This is because a home’s price depends on its location, when it is put up for sale as well as other features. The solution to this problem is to ask a real estate agent for a comparative market analysis of the property. A comparative market analysis is used to estimate the value of a home based on the sales of similar homes in the area. An expert says that when doing comparative marketing analysis, comparative homes should be in the same or similar neighborhood, have about equal square footage, have the same number of bedrooms, bathrooms, and features. But the question arises: since most houses are unique, how do you identify similarity? Experts state that apart from the conditions given below for analysis, there should be an analysis of recent sales that is not more than six months old. And the sales prices should be the final sales price of the homes not the listing prices because some agents can undervalue the prices of homes to make people interested.
- Many persons tend to wonder how to figure out how much their home is worth because it depends on location and when it was listed as for sale.
- Home sellers usually ask their real estate agents for their comparative market analysis which is the estimate of the value of a home based on sales in the area.
- When two houses are termed comparable they should be in the same or similar neighborhood, have the same square footage, and with the same number of bedrooms.
“Whether you’re hoping to buy a house or sell one, understanding the CMA is essential.”