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A ‘CMA’ for Buyers

August 24 2012

While a CMA is traditionally a tool used for seller clients, it has potential for buyers as well. After all, one of the most valuable things a CMA provides is context, a clearer perspective on a single property based on the overall local housing market. Isn’t context just as valuable for buyers as it is for sellers?

CMA Basics
Basically, a CMA (competitive market analysis) is prepared by a real estate agent and provides recent comparable sales and a recommendation for listing price. For a more thorough education on CMAs 101, we recommend you read the following:

Buyer CMA
Now, the concept of leveraging a CMA for buyer clients removes one important component of a traditional CMA – the listing price recommendation (obviously, as the property has already been listed at a given price by the seller). However, just because you aren’t recommending a listing price, doesn’t mean you can’t give your two cents in terms of valuation. Calling upon your ample experience and leveraging your CMA tool, you can instead provide a recommendation on the price you would offer to the seller in order to buy the property.

A buyer CMA could also retain the other key component: comparable recent sales. It’s incredibly helpful for buyers to understand other recent activity in the market. This can provide insight on:

  • Pricing (“Is the property listed too high?”)
  • Availability (“Are there going to be many more properties similar to this cropping up soon?”)
  • Demand (“Is this property going to sell quickly? Should we put in an offer right away?”)

CMA Options
If you’re interested in exploring the idea of a buyer CMA, you’ll need to find a tool with some flexibility. After all, you don’t want to be married to the terminology used for a traditional CMA (i.e. “listing price” recommendation). We offer a full list of CMA tools in our product directory; however, some of the companies you may want to pay special attention to are: Cloud CMA and REALTORS Property Resource® (considered two of the leaders in valuation tools). It’s also a great idea to talk to your MLS about any tools available through your MLS system or any special deals you may have access to as a member benefit. Your broker may also be an excellent technology resource and could advise you on creating a “buyer CMA” of sorts.