What is a CMA (Comparative Market Analysis)?
A CMA (Comparative Market Analysis) is a report prepared by a real estate agent that estimates a property's value by comparing it to similar properties that have recently sold, are currently for sale, or were listed but did not sell in the same area. CMAs are the primary tool agents use to advise sellers on pricing and buyers on offer strategy.
A CMA is not the same as an appraisal. Appraisals are performed by licensed appraisers following strict federal guidelines. CMAs are market opinions from agents using MLS data and professional judgment. CMAs are free (agents provide them to win listings) while appraisals cost $400-$600.
What a CMA includes
A thorough CMA typically covers recently sold properties (closed within 3-6 months), active listings (current competition), pending sales (under contract but not yet closed), and expired or withdrawn listings (properties that failed to sell). The agent selects comparable properties based on proximity, size, age, condition, and features, then adjusts for differences to arrive at an estimated value range.
Adjustments account for differences between the subject property and comps. A comp with an extra bedroom might be adjusted down by $10,000-$15,000. A comp without a garage when the subject has one might be adjusted up. These adjustments require local market knowledge and professional judgment.
CMA vs. BPO vs. appraisal
| Feature | CMA | BPO | Appraisal |
|---|---|---|---|
| Prepared by | Agent | Broker/Agent | Licensed appraiser |
| Cost | Free | $50-$150 | $400-$600 |
| Purpose | Pricing guidance | Lender decisions | Loan qualification |
| Legal weight | Low | Medium | High |
How investors use CMAs
Investors use CMA principles every day, even if they do not call it that. Pulling comps to estimate ARV, analyzing sold prices to determine offer strategy, and comparing active listings to gauge competition are all CMA activities. Deal Run's comp analysis tools automate much of this process, pulling recent sales and active listings within customizable radius and timeframe parameters.