What a CMA Actually Is — and Why It Matters Before You List or Make an Offer

The Foundation of Every Real Estate Decision

Whether you're listing a home or writing an offer, the most important question in the room is: what is this property actually worth in today's market? A Comparative Market Analysis — a CMA — is how I answer that question.

It's not magic, and it's not an appraisal. But when done properly, it's the most reliable tool available for establishing realistic market value.

What a CMA Is (and Isn't)

A CMA is a report I prepare using MLS sales data — recent closings of similar properties in the same area. It is my professional opinion of value, not a formal appraisal.

An appraisal is ordered by the lender after you're under contract, prepared by a licensed appraiser, and required for financing. It uses the same underlying data as a CMA but carries legal weight for loan purposes.

The CMA comes first and informs the decision to offer or list. The appraisal comes later and affects whether the deal closes at the agreed price.

What Goes Into a Good CMA

I build CMAs by looking at comparable sales — "comps" — that meet specific criteria:

• Sold in the last 90–120 days (recent enough to reflect current conditions)
• Within 0.5–1 mile of the subject property (closer is better in neighborhoods with distinct micro-markets)
• Similar size (within roughly ±15–20% of square footage)
• Similar age and condition

Then I adjust for differences. A pool adds value in Surprise — I'd apply a positive adjustment. Backing to a busy road subtracts value. A recently renovated kitchen adds it. These adjustments require judgment and local knowledge.

How Sellers Should Use a CMA

Before you list, a CMA tells you the range your home is likely to sell in. Price at the midpoint to generate maximum showing activity. Price at the top of the range to test the market but risk sitting. Price above the range and watch days on market climb while offers don't come.

I prepare a CMA before every listing conversation I have. It grounds the discussion in data and prevents the painful situation of an overpriced listing that needs corrections later.

How Buyers Should Use a CMA

Before you make an offer, have your agent pull comps on the property. Know whether the list price is accurate, generous, or aggressive. If comps support $450,000 and it's listed at $420,000, you may need to move fast and offer more. If it's listed at $470,000 when comps say $440,000, you know where you have leverage.

I run a buyer-side CMA on every property before we write an offer. It's not optional — it's how you know whether you're paying fair market value or overpaying in the excitement of finding a home you love.