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Going beyond the CMA

In today's market a seller needs every edge he/she can get in order to sell their home. It is the Realtor's responsibility to not only share a Comparable Market Analysis (CMA) with them, but in the current market we also need to go a step further. With inventory out pacing demand in most of our markets we need to take into account the accumulation rate (rate at which inventory comes onto the market) as well as the absorption rate (rate at which homes are selling in any given area). If we as Realtors simply hand the customer or client a CMA, that person's home may be on the market for quite some time.

There are two ends of the spectrum - price is on one end while time is on the other. If the price is only average in your market then the condition, incentives, and marketing effort have to be better than average in order for it to sell before the other homes on the market. If the condition, incentives and marketing effort are average or worse, then the price will have to be better than average to sell in a reasonable amount of time. Knowing how to read the area's absorption rate and monthly accumulation rates can help sell the home for the most money in the least amount of time. That, after all, is the ultimate goal and the very definition of a successful sale!

Posted by Michael Johnson, REALTOR - Goose Creek SC on 10/22/2007 05:55 PM

Comments (12)

cma, absorption rate, accumulation rate, demand, inventory, goose creek, charleston, price vs time

12 Comments on Going beyond the CMA

You're one smart cookie and you'll live longer without the angst of an overpriced listing that will eat an agent alive.

10/22/2007 05:58 PM

by Lenn Harley, Homefinders.com, MD & VA Real Estate

Michael - I agree with Lenn. Knowing your marketing and paying special attention to the time factor as well as proper pricing is extremely important in the present market.

10/22/2007 06:06 PM

by Jennifer Fivelsdal, Rhinebeck NY (Keller Williams Realty)

Great post.....

10/22/2007 06:07 PM

by Julie Chapman Realty Homes Brunswick Georgia

I agree, very smart post. Price seems to be KING in this market. Price will resolve time and condition problems.

10/29/2007 11:54 AM

by Debbie Cook (Long & Foster Real Estate, Inc)

Thanks to the week in review, I've been able to learn a little from your post! I guess I better start playing with those absorption rate formulas!!!!!! And learn them.

10/29/2007 01:58 PM

by Natalie Langford, Winchester, VA Real Estate (Realty Direct of Shenandoah Valley)

Hi Michael,
I don't think there is anything more important for a client to be educated on than his/her market. Thanks for your wisdom.

10/29/2007 02:01 PM

by Cynthia Tilghman, Realtor® Onslow County NC Home Specialist (Kingsbridge Realty, Inc)

Michael,

Just thought I'd mention that we put this post into our version of this week in review. We thought it was a great post!

10/30/2007 10:11 AM

by Pascack Valley Real Estate>> Lisa and Robert Hammerstein (Coldwell Banker)

Michael-It is all about our clients and keeping them well informed. I love your perspective on the CMA. Right now it's not always the only thing to stand by to sell the home.

10/30/2007 10:50 AM

by Julie Neerings~Lifting Hearts ♥ Building Dreams~Utah REALTOR® (Keller Williams Salt Lake City)

Mike: This is a great post. I can really put this information to good use to learn to go beyond the CMA.

10/30/2007 04:02 PM

by Donna Yates, Georgia Realtor North Georgia Blue Ridge Real Estate (Mountain Investments of North Georgia)

Good post! I often see homes come on the market that are overpriced and not in selling condition. It makes me wonder how it's worth the seller's and Realtor's time.

10/30/2007 04:31 PM

by Maui Real Estate - Lisa B. Miller R(S) (Keller Williams Realty Maui)

Thanks everyone for the positive feedback. I hope the information makes a difference in your listing presentations.

10/30/2007 07:15 PM

by Michael Johnson, REALTOR - Goose Creek SC (Carolina One Real Estate)

Good strategy. Thanks.

10/30/2007 08:37 PM

by Adele Irving - Easton Area Homes (Prudential Patt, White Real Estate)