What is a comparative market analysis (CMA) and how is it different from an appraisal report.
The difference between a CMA (comparative market analysis) and a real estate appraisal report is that one is done by your real estate broker and one is done by a licensed real estate appraiser. One also has a cost associated with it and the other usually dose not.
Your realtor will create a CMA by utilizing recent sales data and using their knowledge of the local market. Will compare your home with homes that are similar to yours in your neighborhood. A comparable property is one that is of the same type, style, and features, in similar condition inside and out, and has the same or close to the same number of units and land/living area size etc.
Couple of things we look at are:
- Comparable properties that have recently sold (3-6 Months),
- Properties that are currently listed in the Multiple Listing Service (MLS),
- How long similar properties have been on the market,
- Property listings that have expired or have not sold,
- Location (such as corner lot, school district, street traffic, proximity to hi-ways etc.)
Other methods may be used by your realtor depending on the type of subject property and/or the needs of the client.
A real estate appraisal is done by a licensed real estate appraiser and is most often used by lenders when issuing mortgages for refinancing or buying/selling a home. Appraisals, although, can also used for any other reasons.
A real estate appraiser’s only job is to give an unbiased opinion of value of the subject property. An appraiser will use similar methods in coming to a property value as your Realtor but they must also follow licensing and industry guidelines.
If you are buying a home and getting a mortgage, your lender will always have an appraisal done and you have a right to a copy, but you usually have to ask for it.