The New Better CMA vs The Old Way.
Those of us that have been preparing comparable market analysis for a while know that this report is a compilation of listings available for sale, listings that are under contract and listings that have closed for a specific town, area or neighborhood. Some real estate agents will include expired listings as well.
Unfortunately this is a very myopic view of the potential value of a particular property.
Today buyers are knowledgeable and have available to them the most sophisticated tools to search for properties within the comfort of their residence. This tool is the Internet
Are comparable or similar homes the only competition?
The Internet permits our buyers to easily search and see properties within a radius of a particular point. The buyer is searching for properties lets say within 10 miles of; place of employment, school, highway, etc. The buyer expands his search area within a radius of what in his/her opinion is a reasonable commute.
This fact makes all the properties in this area competition for a seller, even if the property is not comparable or in a different town.
Do we need to broaden our research when preparing a CMA to include neighboring towns?
Yes we do! The Internet has made the condo, cape or what ever style property it maybe within that radius competition, regardless if it is similar/comparable in the same town or not.
What constitutes a better picture of value?
My town, Wayne New Jersey, happens to have a park and ride. For a commuter/buyer, Wayne and its neighboring towns within a 5 to 10 mile radius would be consider for a property search. These properties will all be competing for the buyer's attention.
In my opinion my seller/clients would benefit from a broad viewed CMA with marketing statistics of value. This would be the best tool to help a seller in determining a price range for today’s market and getting the property sold.
Set yourself apart...Think like a buyer.