In real estate, a comparative market analysis (CMA) is the process of evaluating a property’s market value by comparing it to similar properties that have recently sold, are currently listed, or failed to sell in the same area. Note that a CMA is not an appraisal, and CMAs must prominently state that they are not appraisals, since appraisals must follow certain standards and be performed by licensed appraisers.
The comparative market analysis considers key factors such as location, size, condition, features, and market conditions, with adjustments made to account for differences between the subject property and the comparables. Real estate professionals commonly use a comparative market analysis (CMA) to help sellers set an appropriate listing price and to assist buyers in making informed offers. A well-prepared comparative analysis reflects current market trends and provides a practical basis for pricing decisions.
Note that a broker price opinion (BPO) is essentially the same as a CMA, but it is usually performed by real estate agents for lenders, rather than for buyers or sellers. A BPO is also not an appraisal.
