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The Difference Between a Comparative Market Analysis and an Appraisal

The Difference Between a Comparative Market Analysis and an Appraisal

REALTOR® showing clients the value of their home
What is your home worth? Ask your REALTOR® for a CMA.

It can be difficult for sellers to distinguish between two methods of finding the value of their home: a Comparative Market Analysis (CMA) and a home appraisal. Though they share many similarities, there are key differences in how the two approaches ultimately arrive at a listing price for your home.

The Difference Between a Comparative Market Analysis and an Appraisal

Comparative Market Analysis (CMA)

A CMA is conducted by an agent using their knowledge of the San Diego market in conjunction with information available to them on the multiple listing service (MLS), which contains data on sold homes and market trends. A CMA helps to price the home more accurately, keeping the property competitive in the current market. For those who are thinking of selling their home For Sale By Owner (FSBO), it’s worth noting that you will not be able to conduct a CMA on your own, since, among other things, access to the MLS is exclusive to real estate agents.

Your agent’s analysis accounts for the various factors that influence home prices to arrive at an accurate estimate of your home’s value. A CMA compares your home to others in your area that have either recently sold, are currently on the market, or had previously listed but have since expired, typically using data from the past three-to-six months. Comparable homes, or “comps,” are homes whose characteristics are similar to your own, such as the housing type, condition, and the square footage and property size. A thorough CMA will provide information on what homes in your area of San Diego are selling for, how long they were on the market, and the difference between their listing and sold price, and will list a low, median, and high selling price for your home.

Appraisal

The main difference between an appraisal and a CMA is the personnel involved. Whereas a CMA is conducted by a real estate agent, an appraisal is carried out by a licensed appraiser on behalf of the bank. Once a buyer applies for a loan to purchase your home, the bank will order an appraisal of the property. Though appraisers use methods of comparison similar to an agent’s CMA, unlike a real estate agent, bank appraisers have no vested interest in the sale of the home. The goal of an appraiser’s visit is to determine your home’s fair market value to ensure that the bank isn’t lending more money to the buyer than needed.

*About Windermere Homes & Estates*

Windermere Homes & Estates was founded by Rich Johnson in 2013 and has been setting the standard ever since. The forward-thinking company has opened offices across Southern California and is now home to over 600 active and referral agents. The brokerage has received accolades from the San Diego Association of Realtors® (SDAR) such as the Brokerage Achievement of Excellence and Fastest Growing Real Estate Brokerage in 2015. The creation of a place for agents to collaborate and connect on a daily basis both virtually and in person has been a key factor in Windermere Homes & Estates’ success.

*About Windermere Real Estate*

Windermere Real Estate is the largest regional real estate company in the Western U.S. with over 300 offices and 6,500 agents serving communities in Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, Oregon, Utah, Washington, and Mexico. Last year, Windermere closed over 74,000 home sales for more than $40.6 billion in dollar volume. The Windermere family has a proud heritage of serving our neighbors via the Windermere Foundation which funds services for low-income and homeless families. Since 1989, the Windermere Foundation has contributed more than $43 million towards improving lives in the communities where we live and work. For more information, visit windermere.com.

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