Massachusetts Continuing Education Course – 2 Credits. A CMA is an unbiased estimate or opinion of the market value of real property by a real estate licensee. This course is designed to explore several approaches used to determine a property value. Multiple uses of a CMA will also be discussed as well as its preparation and presentation.

1. Comparative Market Analysis – CMA
RE62RC10
Jody OBrien

2. Comparative Market Analysis Category - Real Estate Glossary
- Real Estate Terminology
Comparative Market Analysis or Competitive Market
Analysis is often referred to as a CMA.
A CMA is a study or comparison of recently sold homes,
properties that failed to sell, as well as properties currently on
the market, that are substantially equivalent to another home
in terms of selling price, location, style and amenities.
www.realestatewiki.com

3. What is the Difference Between an Appraisal, a CMA and a
Zestimate?
Category - Home Selling FAQ's - General Home Selling
The appraisal is the process of developing and communicating an opinion about a property’s value. The
appraisal is conducted by a licensed professional typically working for the lender. It usually includes comparable
market information or direct sales comparison, reproduction or replacement cost estimates and, if applicable,
the income approach which considers capitalization of net operating income from a property.
A comparable market analysis (CMA) is estimation of a property's value is based on the recent sale prices of
properties within the same area that are comparable in square footage, amenities and features similar as well
as information regarding comparable active properties (for sale on the market) and expired properties (where
the assumption is that they failed to sell for being overpriced.)
The Zestimate - Zillow’s home valuation approach - is computed using a proprietary
formula and historic sales and local authority data. It often does not include changes,
upgrades or local nuances unique to the property and can therefore only be seen as a
starting point in determining a home's value or a broad range of value.

6. • Incorrect data
• Pre Foreclosures
• Make Me Move
• FSBO’s
Why the difference?
Do Some of these listings affect your
pricing?

7. The Fundamentals

8. 
Cost. Cost is the amount of money expended
to build or acquire a home.

Price. Price is the amount of money presently
asked for a home

Value, Value is an estimate of the benefit of
ownership and is typically expressed in
dollars.
Appraisal Terms

11.  Market Value. Market value is an average
price based upon current market conditions
 Regression. Over improvement beyond
market value.
 Progression. An under-improved or under-
developed home below market value of the
neighborhood.
Appraisal Terms

12. • Substitution. The cost of building or
acquiring an equally desirable substitute
somewhere else.
• Conformity. Homes in a neighborhood
should reasonably conform in terms of style,
price range, size, features, etc.
• Contribution. The value of an item in a home
decreases and the number increases.
Appraisal Terms

13. 
Market Condition
− DOM
− List to Sale Price Ratio
− Average Sale Price
− Inventory or Absorption Rate
Market Conditions

15. Market Conditions
$350,000 – $500,000
Wellesley, MA

16. Market Condition
1 – 5 Million
Wellesley, MA

17. • MLSPin Economic Market Report
Market Conditions

18. 
Range of Value
− Negotiations

Financial alternatives
− Short Sale
− Mortgage Workout
− Assumable
− Seller Financing
− Seller Participation
Purpose

20.  Net Equity
− Mortgage Pay Off Amount
− “Put in your Pocket”
− Negotiate to Win win
− Net Sheet
− Fuel charges
Purpose

21.  Get an appointment
 Show professionalism
 Create trust and confidence
 Serve as a script
Purpose

22.  Cover folder
 Cover title page and photo
 Introductory letter
 Area map
 Complete property description
 Public information
Content

23.  Owner’s name
 Address
 Legal description
 Information on whether the property is a
Torrens property – Registered land
 Amount of annual taxes
Content
Contained in the Deed

24. • Amount of annual taxes
• Pending assessments (including specials)
• Assessed building value
• Assessed land value (if separate)
• Total assessed value
• Year of construction
• Lot square footage or dimensions
• Building square footage
Content
Contained in the Assessor’s Card/Field Card

25. 
Mortgage information
 Type
 Current payment status
 Pay off amount
 Prepayment penalty
 Assumption fee and requirements
Content

26. • Active
• Sold
• Expired
• Under-agreement
Comps

27. • Market Condition
• Financing
• Time
Value

28. • What makes a Comp a Comp?
• Buyer Pool
– Size
– Location
– Bed/Bath/Room
– Condition
– Supply and Demand
Value

29. • Worth vs Value
• Buyers set the Value
• Sellers set the Price
Price Range

30. • Faster
• Less inconvenience
• Exposure
• Agent response
• Better Buyer reaction
• Higher offers
Competitive Pricing

31. Jody O’Brien
The RE/Education Company
Committed to Professionalism in Real Estate through Education
Website/Blog
www.reeducationcompany.com
Presentation
www.slideshare.net/ReEducationCompany
Social Media
www.twitter.com/reeducator
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Thank you for Attending