One of the most difficult aspects of selling your home is the starting point of home value: what is your home worth? How does it stack up to other homes on the market? Don’t worry — you don’t have to comb through random home listings on the Internet to figure out your home’s market value! There’s an easier way, and all it takes is a phone call or e-mail to your local real estate agent here in the Ocala area. They’ll put together something called a comparative market analysis report for you, and most will do it for free. A comparative market analysis report, or CMA, is a compilation of recent and local home market trends all in one handy guide. Keep reading to learn more about CMAs, and how they can help you when it comes time to sell your home.
What’s in a CMA, Exactly?
This can vary between the realty companies that compile them, but most contain the following standard data on the listings in your area:
• Active Listings — This section gives you all the pertinent info on houses that are currently up for sale — your “competition” so to speak. Take the data in the active listings section with a grain of salt, however; just because someone is asking half a million for a two-bedroom home next to the railroad tracks doesn’t mean that’s its actual market value. The prices here are offered sales prices, meaning that’s what the owners believe their home is worth. Most are reasonable, others, not so much. Pay close attention to this section to get an idea of the current market, but don’t base your home’s worth solely on the figures within it.
• Pending Listings — These are formerly active listings under contract. These are not comparable sales (we’re getting to those, promise), but they do give you an idea of where the market is moving. Homes priced above these figures generally stay on the market longer.
• Sold Listings — These are comparable sales, the ones you should pay extra attention to. These numbers reflect what homes are actually selling for, and include prices for homes sold in the past six months. The sold listings are the ones that will give you a solid idea of the market value of your home.
• Off-Market Listings– This is the “cautionary tale” section. Most of these homes went off the market because they were priced too high (though there are a variety of other reasons they might have been withdrawn). Take note of the median prices here to avoid overestimating the value of your home.
How Can a CMA Help Me?
The information contained in a CMA gives you a general idea of what sellers in your area are asking for homes, the prices homes in your area are selling for, and the prices most buyers refuse to pay for homes. You can use all of this data to formulate a reasonable market value of your home at your discretion, especially by looking at the sold listings. Here are a few other ways to get the most mileage out of a CMA:
• Look for similar square footage. Try to keep your comparisons within 200-400 feet of your home’s square footage.
• Compare your home to others with similar amenities. Does your home have a pool? Is it recently remodeled? Features like these are definite pluses in the appraiser’s book.
• Be aware of the age of your home and look closely at the prices of similarly-aged homes in the CMA. Homes with distinctive period flair like Victorians, Arts and Crafts style, and 1950s homes generally sell for more than homes built in the 70s and 80s. Homes built within the last decade also do very well on the market. You can’t do much to improve the age of your home, but it does help you know what price you can reasonably command in comparison with others.