A recent survey found that the cumulative value of all homes currently built in the U.S. rests at $31.8 trillion. In real estate, there is a difference between comparative market analysis (CMA), and the value of the house as appraised by the bank. A skilled realtor can use CMA reports to their advantage. The key is knowing how to present CMA findings in a positive light, whether the client is a buyer or a seller.
How Has the Recent Housing Market Changed?
Research shows that the year 2016 had the lowest rate of homeownership when compared to data from the last 50 years. Of the homes purchased, about 19% were listed as investment purchases. This means that the buyer cited that they did not plan to use the property as their personal living space. As housing prices dropped, it was easier for investors to pluck up real estate. As housing prices rise in today’s market, comparative market analysis will come into play.
How Do CMA Tools Assist Realtors In Today’s Housing Market?
Realtor CMA techniques rely on being informed. This requires some research into the neighborhood of the home the realtor is working with. The value of a home as assessed by the bank can be less or more than the comparative market value. Comparative market analysis shows what buyers were willing to pay for their home. CMA usually relies on past sales to draw information from, meaning the realtor scopes out the recently sold homes in the area to make a report.
How Can Comparative Market Analysis Be Used Positively For Both Buyers and Sellers?
CMA for realtors’ work methods can be used to the best advantage. When homes sell for a higher price than the bank’s estimated value, it is clear other features are driving up the price. These features can be used in service to the seller by asking for a higher price. Or in the case of buyers, these features can help make a home appear more attractive. These special features so to speak, are so known because they are capable of having a positive impact on the homeowners daily lives.
What Can Effect the Comparative Market Value of a Home?
Amenities that make the homeowners’ lives easier can have an effect on the final sale price. Houses that are close to freeway on-ramps is one such feature. A nearby park, good schools, and proximity to shopping centers are all perks that have to do with one thing: location. The location of a home can perhaps have the biggest influence on the final sale price.
While there is nothing to be done about the location of a house, there are a few other features that concern comparative market analysis. For example, renovations are always good for increasing a sale price, whether it is for landscaping or interior renovation. A skilled real estate agent knows to use CMA reports as a tool in their business dealings.