Best Way To Formulate CMA For Property
Can anyone help me with advice on the best way for me to formulate an accurate CMA for property that I am considering for a buy? I am trying to insure that a repeat of a recent disaster with the REA doing it doesn'r reoccur. The primary interest lies with buy/rehab. I appreciate any help offered here.
Thanks
Dave
Dave,
Well as long as you have a realtor who owes you a favor. ..
Start with the local MLS system. Structure a group of search critereia which describes the house you are looking to do. Look at the houses that come up as a result. Look only at actual solds as comparables. But look at active listings as well to see what the "competition" is doing.
Then drive by these houses and see how much they are actually comparable to "your" house. Are the neighborhoods better/worse? Is the access to transportation/jobs better/worse? Are the schools better/worse.
In the end the CMA is as much art as science. You need to understand what is important to buyers in your area. What will they pay more for? What reduces value?
Dave,
When I do CMA's, I'm picky about the properties I use as comparables--location-wise. I try to stick with properties in the same neighborhood as the subject property. The more recent the sales, the better, and usually not older than 6 months. Once I develop a list (and have driven by them), I make upward and downward adjustments to the estimated value of the subject based on location, condition, amenities, house size, lot size, etc. of the comps. Somewhat similar to the appraiser's approach, although I'm not an appraiser. I also look at the number of days on the market for the comps to sell. I look at properties currently for sale just to see current competition, but don't use list prices as any validation of prospective value. I've found the + or - adjusting to be the best way of measuring estimated value.
Nancy
Nancy
Once again I thank you for your great insight.
Dave