Comparative Marketing Analysis

By
Real Estate Agent with DFW FINE PROPERTIES 0506509

Educational Information 1/20/2019

by Patricia Feager

 

Comparative Marketing Analysis

 

Real Estate Agents use Comparative Marketing Analysis (CMA) to share information with Buyers and Sellers. This information may be collected from three to six months inventory of similar properties that are recorded in the MLS. It all depends. Data collected from the CMA is an opinion based on numbers reported. What is important to know is the interpretation of any data is subjective. For example, days on the market are aggregated and summed up in the CMA. Depending on who collected the data for a CMA it may include all number of days on the market lumped together on average regardless of the circumstances. 

Whether the buyer buys with Cash or needs Financing the numbers will vary. For example, a cash offer can take ten days or less but when a buyer uses financing there are many reasons why it may take longer to close. When interpreting data there is a lot to take into consideration.

For example:

  • There is a contingency that the buyer can’t buy unless they sell their home.

  • There may be multiple contingencies, the buyer can’t the home they have under contract if there is a contingency on their home, and that other buyer has a problem and can’t close.

  • A property went under contract but the buyer walked and the seller had to put their home back on the market.

  • Lender required repairs postpone the closing.

  • Government loans usually take longer to close than Conventional Loans.

  • Environmental conditions, such as forest fires, tornadoes, hurricanes, blizzards, etc.

  • There was an agreement between the Buyers and Sellers to close at a later date.

  • A contract has a way out for the Buyer, i.e., Option Period, HOA restrictions, Title Commitment objectives, etc..

  • Buyers Financing didn’t get cleared to close.

  • Insurance Claims need to be satisfied prior to closing.

  • Construction on a seller's new home needs more time and buyer agrees to delay closing.

These are just some examples. There could be many more. Days on the market can vary based on agreements between the parties or situations involved that delayed closing. When a prospective buyer and/or seller is presented with a CMA, there are many different variables to take into consideration and the context for that data is subjective to days on the market, list price, active, contract and pending listings.

 



Staying Positive Helps --- Patricia Feager

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Texas Law requires all license holders to provide the Information about Brokerage Services form to prospective clients.

Real Estate Commission Consumer Protection Notice  

 

 dfw fine properties

 

DFW FINE PROPERTIES

                                        3575 Lone Star Circle, Suite 315
                                        Fort Worth, TX 76117
                                        Office: 817-748-4800/FAX: 817-748-4900

                                         Patricia Feager
                                                        Cell: 469-951-4758

                                                        Email: patricia.feager@gmail.com

 

CERTIFICATIONS

Certified Residential Specialist
Certified Pricing Strategies; Mastering the CMA
Certified Military Relocation Specialist
Certified Negotiation Expert
C
ertified RE Probate Specialist

"With self-discipline most anything is possible." --- Theodore Roosevelt 

 

 

  

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Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Roy Kelley - Thanks for your support and confirmation that these are the things that need to be addressed with buyers and sellers. 

Jan 21, 2019 06:18 AM #22
Rainmaker
1,236,965
Sheri Sperry - MCNE®
Coldwell Banker Residential Brokerage - Sedona, AZ
(928) 274-7355 ~ YOUR Solutions REALTOR®

Hi Patricia Feager, MBA, CRS, GRI,MRP - Congratulations on the gold star!  To me, another crucial factor in providing a value added CMA is knowing your market extremely well. 

Jan 21, 2019 06:19 AM #23
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

James (Jim) Lawson, DBA - Learning how to use the data right without causing alarm or jumping to conclusions should be the goal of every licensed agent. After all, the nature of the data has many unknown variables and not all closings are the same. I appreciate your input!

Jan 21, 2019 06:21 AM #24
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Sham Reddy - Before an agent can educate their client, they need to be educated themselves!

Jan 21, 2019 06:22 AM #25
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Sheri Sperry - MCNE® - The paucity of data coupled with the obscure context is always a challenge and the attempt to just pass the information on to buyers for their own information and/or interpretation without complete understanding defeats the purpose of educating the buyer. 

Jan 21, 2019 06:29 AM #26
Rainmaker
1,502,005
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

Good morning Patricia Feager, MBA, CRS, GRI,MRP, a CMA is a lot more than just pulling the data from MLS as well as other sources available(such as Public Records), while it's a great tool when buying and selling a home, one must remember the fact, there are many variables and sometimes, it's not even possible to know all the details. Well deserved feature! 

Jan 21, 2019 06:58 AM #27
Rainmaker
2,464,739
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

This reminds me of when you get an MRI. you can stare at the pictures and data all day long but what does it mean? You need someone who speaks MRI

Jan 21, 2019 07:34 AM #28
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Richie Alan Naggar - To quote Andy Warhol: "I'm afraid that if you look at a thing long enough, it loses all of its meaning." 

Jan 21, 2019 07:41 AM #29
Ambassador
3,823,247
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Patricia that is a lot to take into consideration and you did a great job pointing it out clearly.

Jan 21, 2019 03:17 PM #30
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

George Souto - As a Lender, I appreciate your confirmation. There really is a lot to take into consideration when interpreting data. Agents and consumers should not be too quick to judge without an understanding of the information on the CMA. 

Jan 21, 2019 03:50 PM #31
Ambassador
4,014,536
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

Hi Patricia

There certainly are all kinds issues that can factor into the data, inlcuding human error in entering it - wrong sale price being a big one!

Jeff

Jan 21, 2019 09:28 PM #32
Rainmaker
873,318
Elyse Berman, PA
Best Connections Realty, Inc. - Boca Raton, FL
Boca Raton FL (561) 716-7824 CRS, ABR, GRI,ePR

Patricia Feager, MBA, CRS, GRI,MRP You did a great job of explaining CMAs to the public.  One really has to know the market.  We have one area with multiple subdivisions.  Certain subdivisions sell for more, despite having the same square footage as the others.  That's just the way it is.  Everyone locally knows it.  If someone new doesn't, it must be explained.  It cannot be explained on straight square footage.

Jan 22, 2019 02:33 AM #33
Rainer
285,571
Ron Aguilar
Continental Mortgage - Saint George, UT
Mortgage & Real Estate Advisor since 1995

Patricia, thanks for the explanation. As a Mortgage lender this information is great to remember when the conversation comes  up.

Jan 22, 2019 08:19 AM #34
Rainmaker
981,121
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Excellent reasons, and there are many, that affect the real estate calculations for days on market.  Great post Patricia! Words of wisdom will prevail for you in your business!

Jan 22, 2019 11:21 AM #35
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Jeff Dowler, CRS - There are an array of unknowns behind the data. It's all about the delivery and how to use it effectively.

Thanks, Jeff.

Jan 22, 2019 01:40 PM #36
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Beth Atalay - Pulling the data. Knowing what you're talking about to gain understanding. Delivering the information and being truthful about interpretation gains trust. Variables are always subject to change. All these matters when determining list price and offers. 

Thank you, Beth.  

Jan 22, 2019 01:43 PM #37
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Elyse Berman - Your points are well taken and true! Agents who sell in areas they don't even know are doing their clients a disservice. An area within a one-mile radius can serve multiple subdivisions with HOA's and taxes will be different too. An experienced local agent should know the difference and how to interpret and understand the CMA with care. 

Thank you!

Jan 22, 2019 01:49 PM #38
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Ron Aguilar - Conversations like this need to happen. Buyers and Sellers need to understand.

Thanks for commenting!

Jan 22, 2019 01:51 PM #39
Rainmaker
2,036,708
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Fort Worth, TX
Selling Homes Changing Lives

Thanks, Jan Green. Not everyone can or should sell if they don't know what they are doing.  

Jan 22, 2019 01:52 PM #40
Ambassador
3,356,615
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Love this, Patricia and a wonderful explanation of the process. It's a 'process,' for sure! Knowing the local market is key to plugging in the data and it kills me to hear others quote the dreaded Z values! 

Great post and congrats on the feature!

Jan 22, 2019 09:30 PM #41
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