Comparative Market Analysis

When you first start looking into selling your home, undoubtedly the first thing you want to do if figure out how much you can get for it. This can be a difficult process if you do not have the appropriate tools.

First off, we have to deal with our emotions. We all have a value that we place on our home. High or low, for positive or negative reasons and that is all well and good. It is however, not a good way to assess our selling price. What you paid for it does not affect the current market price, and neither does the fact that you raised all of your beautiful and gifted children there. The only thing that determines that price is what the market will pay for it.

The next thing people tend to do is look at their tax assessment. While this can sometimes land you in the ball park of a homes market values, the emphasis there is on sometimes. Assessments are typically done on a drive by, and are guesses based on known or assumed features of a property. While they are a good starting point for determining the property tax liability of a property (and sometimes they are way off base for that), it is not uncommon for an tax assessment to be off by 50% of the properties market value. This will sometimes be too low and sometimes be too high. So while it is frequently used by home sellers, it is a terrible method for finding home prices.

The next most common method is to go to one of the many “real estate” websites out there today, look up their address and see what the internet says their home is worth. Truthfully these are not usually too far off, however there are some caveats to that. First and foremost, you have to double and triple check that all the information about your home is correct on the site you are using. It will frequently be incorrect and depending on the feature that is omitted or added, it could mean a major difference in suggested price.

Probably the most accurate method of finding a homes worth, and the one used by banks to determine financing a home, is having an appraisal done. The down side with this one is that it will cost you approximately $400. To top it off that very valid valuation, still doesn’t tell you what someone is likely to pay for the home.

So we come to what real estate brokers do. The Comparative  Market Analysis. Basically what happens is we gather all the information about your home we can. Size, number of rooms, bathrooms, you know all the information you tend to see in a home listing. We pile all of that information into our local listing service, and we try to locate 3 or more homes very similar to yours, in the same school district, and preferably the same neighborhood that have sold in the last three months. We then run a couple of formulas to account for any differences between your home and the comparable homes. Afterword we will check on home sales statistics in your area to see if prices are trending up or down in your area and what the average selling time is of late. Next thing you know, we have a suggested listing price based on a CMA (comparative market analysis).

By following this process successful agents will consistently be within 5% of the actual selling price nearly all the time.

So if you are thinking about selling your home, or if you would just like to know what your home may bring on the open market; fill out the form below and request a CMA on your home.

If you are thinking about selling your home, or if you would just like to know what your home may bring on the open market; fill out the form below and request a CMA on your home.
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About Robb

A husband, Dad to 5, and Grandpa to 9. US Navy Vet. 18 Year Postal Employee turned full time Realtor. I enjoy a wide variety of things, but you will find that here I mostly write about Indianapolis, government/politics, recent news, and whatever book I am reading or have just finished at the moment.
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