Real Estate: What is a comparative market analysis?

In the property industry, a valuation tends to be a costly exercise for homeowners and especially when you only want to establish the value of your property. And that is where estate agents can be of great value to homeowners when they want to find out what their house may be worth by doing a comparative market analysis (CMA) of the property.

Firstly, the estate agent will visit your property, do a thorough inspection with a walk-through to determine the condition of your property. Numerous factors will be looked at like the age of the house, the size of the house and plot, the condition of the house and other factors like a swimming-pool, location and area where it is situated, as all of these will influence the potential selling price.

Then also important factors that will be used to add a value to a property will be:

• Recent sales of houses and plots in the same neighbourhood.
• The prices of the properties currently on the market that can compare with the property and will compete.
• The average sales price of plots and houses in the area.
• Whether it is a sellers’ or buyers’ market.

By using all of the above and using the most recent data from official sites like ex Lightstone of the surrounding area, a value can be determined to inform prospective sellers of a reasonable price for their property.

However, it is still the buyers who determine the price of your property as they will decide what they are prepared to pay for your house or vacant land.

As many estate agencies are prepared to do this as a free service to assure that property owners will be assisted to make an informed decision, it is worthwhile to investigate this option.