Difference Between a CMA and a Home Appraisal?
If you're a first-timer to selling a house, it is easy to get lost in real estate jargon. The difference between a home appraisal and a competitive market analysis (CMA), is one of the most confusing aspects of real estate transactions. Both reports are crucial in the home-selling process. However, while they may be similar, there are some big differences.
A CMA Is An Agent Process
Your real estate agent will conduct a competitive marketing analysis to determine the best price for your property. Your selling agent will usually offer a CMA for free.
CMAs evaluate homes that have recently been sold similarly to yours. These are often called comps. Real estate agents will gather this information from the multiple listing system (MLS), which essentially pools information from agents on for-sale homes. Unfortunately, the MLS is only accessible to real estate agents. This is why it is so difficult to list your home FSBO (for purchase by owner).
Your agent will look at similar homes when conducting A competitive marketing analysis. The CMA provides information about properties on the market and properties that are pending, sold properties, and properties that have expired. In addition, CMAs will list the home's low, median, and high prices as well as the average days on market. Although a CMA doesn't provide exact information, it can give you a pretty good idea of a reasonable list price.
Appraisal Is A Process That Banks Use
Once a buyer has applied for a loan, the home appraisal takes place. The bank will arrange for a licensed appraiser visit to your home after the buyer has submitted an offer.
The biggest difference between a CMA appraisal and a home valuation is that licensed appraisers must be either state licensed or certified. The bank initiates the home valuation process. However, the home appraiser acts as a neutral third party and has no vested interests in the outcome. Instead, they provide information and facts to help determine fair market value.
The bank hires the appraiser to ensure that they aren't lending too much money. The appraisal will include information about the property's condition and recent information about similar listings. It also includes information about the neighborhood.
A CMA is more like an appraisal, but you can prepare for one. You can ensure that your home is in good working order by fixing any obvious defects and keeping the house up-to-date. Although you cannot predict the outcome of an appraisal, you have greater control than a CMA. Although CMA and appraisal are two different processes, they both provide accurate and current information about the value of your home.
