A CMA (Comparative Market Analysis) is a real estate professional’s estimate of a property’s current market value based on recent sales of similar nearby properties (called comparables or “comps”), adjusted for meaningful differences.
You'll also see terms like “comp analysis,” “comparative market value,” or simply “market analysis.” All refer to the same agent-driven valuation process distinct from formal valuations like an appraisal.
CMAs are used to recommend a listing price, set offer strategies, support negotiation positions, and educate clients about local market activity and trends.
| Method | Purpose | Formality | Who can produce | Typical cost |
|---|---|---|---|---|
| CMA | Estimate market price for listing/offers | Informal, market-based | Real estate agents/brokers | Often free — $0–$200 if detailed |
| Appraisal | Lender underwriting & formal valuation | High formality, standardized | Licensed appraisers | $300–$1,000+ (varies by property) |
| AVM | Automated instant estimate | Low formality, algorithmic | Technology providers (Zillow, CoreLogic) | Often free or subscription-based |
| BPO | Quick broker valuation for institutions | Moderate formality | Brokers/agents for lenders | $50–$400 |
Lenders require a licensed appraiser to produce a formal valuation tied to loan underwriting standards and regulatory requirements. A CMA cannot replace an appraisal because it lacks the appraiser’s independent inspection, standardized methodology, and legal standing for lending decisions.
CMAs rely on sold prices (most important), active and pending listings to show competition, and market activity indicators like days on market and sale-to-list ratios.
Agents pull MLS and public-record data: sale history, tax assessments, permits, legal lot size, finished square footage and past listing history—each helps validate or adjust values.
Adjustments convert comp prices to the subject property’s equivalent by adding or subtracting value for differences—examples: +$10,000 for a finished basement, –$8,000 for smaller lot. Good CMAs document rationale for each adjustment.
Most CMAs use 3–6 sold comps as a baseline. Use more comps in volatile markets, for unique properties, or where sold inventory is thin.
In hot markets, prioritize sales within 30 days. Normal markets often use 60–90 days. In slow or rural markets, extend the window to 6–12 months and apply market adjustments to account for timing.
A well-prepared CMA often narrows a value range to within roughly ±5–10% of eventual sale price in stable markets; accuracy varies more in thin or volatile markets. Request a formal appraisal when you need a lender‑acceptable value, tax/estate valuation, or high‑stakes litigation/settlement evidence.
Collect subject property details and search for sold listings on MLS (if possible), county assessor/recorder, and portals like Zillow/Redfin for sale history and tax records.
Pick 3–6 sold comps closest in location, size, age and condition. Rank them by similarity and recency.
Apply dollar adjustments for major differences. Example formulas: adjust for square footage by multiplying per‑sqft rate (comp sale price ÷ comp finished sqft). Add/subtract fixed values for features (pool, garage, finished basement) based on local market norms.
Average adjusted comp prices or use a weighted average (give more weight to the most similar comps) to produce a recommended listing price range. Reconcile with active market conditions and pending sales.
Use MLS for the best data; supplement with county GIS, Zillow/Redfin for quick checks, and dedicated CMA tools (agent software) or simple spreadsheets to document comps and adjustments.
Ask for a “market analysis” or “listing CMA” if you plan to list; say you’re a buyer if you want validation for an offer. Expect a brief free CMA for lead purposes, and a more detailed listing presentation CMA if you’re interviewing the agent to list your home.
Turnaround: a simple CMA can be ready in 24–48 hours; a full listing presentation may take several days. Deliverables often include an executive summary, comp pages with photos, a map, adjustment notes, and a suggested price range.
Insist on sold prices and sale dates, addresses of comps, DOM, and a clear list of adjustments with explanations so you can verify the agent’s reasoning.
Look first for a short summary that states the recommended listing price or offer range and the reasoning tied to comps and market conditions.
Each comp page should show address, sale price, sale date, sqft, beds/baths, lot size, DOM, photos and any adjustments applied to equalize the comp to the subject.
Ensure the CMA explains adjustments, summarizes whether the market is trending up or down, and provides tactical recommendations (pricing strategy, time-to-market expectations, staging suggestions).
Buyers can present a CMA excerpt showing comparable sold prices to justify a lower offer or to support an offer at asking price if comps validate it. Use pending sales and inspection contingencies to shape the final offer.
Combine CMA pricing with inspection outcomes—if inspection reveals defects, adjust your offer or request repairs. Sellers should factor staging and minor repairs suggested by the CMA into list price or pre-list preparation.
Most agents offer a basic CMA for free as a lead service; a detailed or customized CMA as part of a full listing presentation may be more comprehensive and sometimes charged in special cases.
A basic CMA: 24–48 hours. A detailed report: a few days depending on research depth and requested deliverables.
No—requesting a CMA does not obligate you to sign a listing agreement or pay commission. A CMA is an informational service; commissions are negotiated when you list.
A CMA estimates a likely market range but cannot predict the exact final sale price, which is influenced by buyer competition, financing, contingencies and negotiation.
The appraisal typically governs financing. If a CMA and appraisal differ significantly, discuss both reports with your agent and consider a second appraisal or market re-assessment if necessary.
Maria requests a free CMA from two agents. Each agent sends a report with 4 sold comps within the same subdivision, notes on recent upgrades and local trends, and a recommended price range.
Maria checks sale dates, DOM and adjustments. One agent used newer, higher-priced comps farther away—Maria flags this as optimistic. She chooses the agent whose comps are closest in distance and condition and whose adjustments are clearly explained.
Maria lists near the midpoint of a realistic CMA range, stages the home and receives two offers above list within two weeks. Lesson: verify comp selection, insist on transparent adjustments, and combine pricing with presentation and timing.
Seek a second CMA or a formal appraisal when values are disputed, for estate or divorce settlements, substantial investment decisions, or when lending is involved.
Use MLS and county records for the best data; Zillow and Redfin for quick checks; a spreadsheet or CMA template to document comps and adjustments. Consider downloading a CMA checklist template to ensure transparency when comparing agent reports.
Hire an appraiser when you need a lender‑accepted valuation, formal documentation for legal/tax matters, or an independent opinion for high‑value or complex properties.
A CMA (Comparative Market Analysis) is an agent-prepared, market-based estimate of a home’s value using recent comps, active listings and market data; it’s an essential, flexible tool for pricing, negotiations and client education but is less formal than an appraisal and should be evaluated for transparency and local accuracy.
Ask for clear comp selection and adjustment explanations, verify key data yourself, combine the CMA with market timing and home condition improvements, and obtain an appraisal when you need lender acceptance or a legally defensible valuation.
