Dear Sue,
I have been thinking about selling a home that I have owned for more than 30 years.
I called a real estate agent that has been working in my neighborhood. I told her that I wanted to know how much my home was worth. She told me that she had to do a CMA.
I didn’t want to appear clueless but what in the heck is a CMA?
~ Clueless Cal
Dear Cal,
The acronyms AVID, CMA, SFR, REO, CRS, GRI, are “short cuts” for terms that real estate agents unwittingly throw around.
When Realtors use abbreviations like these they make others feel like outsiders and lost. I am in the real estate business and sometimes even I am forced to stop agents and ask them to translate.
In my opinion, it’s important to use language that your clients understand. Otherwise, what’s the point?
Back to your question, a CMA stands for comparative market analysis.
It is the process of determining market value by comparing a property with comparable or similar properties that are currently on the market, pending, sold and expired.
The properties that are used as comparisons should ideally be of similar location, condition, size and age. The comparables should also be of similar quality.
If there are no similar properties with which to compare, it becomes more complicated to give an accurate market analysis. An agent familiar with the market area can extrapolate by making adjustments to compensate for differences.
An easy example: your home has a pool with a waterfall and professional landscaping. If there’s a similar home in your market area without a pool or landscaping, an adjustment of X amount dollars can be added to your home’s value.
The more different the available properties are from each other, the more market knowledge and skill is required.
My first broker, Bill Bertrando, once said that a home in Watts could be compared to a home in Auburn if one could determine the differential.
So let your agent do the comparative market analysis, and tell her to stop using Realtor speak. It’s a matter of good Home $$$s and Sense.
Sue Thompson is owner and sales manager of HomeTown Realtors in Auburn.
