81st ave bpo

Cloud CMA

COMPARATIVE MARKET ANALYSIS

616 81st Avenue N , Brooklyn Park, MN 55444

PREPARED FOR

Andrew MayambaMARCH 25, 2014

Realty Connect | RealtyConnect | 3169 Fernbrook Ln N | [email protected] | Office: (763) 447-3151 |http://www.realtyconnectmn.com | http://www.realtyconnectmn.com/blog/

http://www.mapquest.com/?q=3169+Fernbrook+Ln+N

mailto:[email protected]

http://www.realtyconnectmn.com

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INTROCloud CMA

WHAT IS A CMA?

No two homes are identical, which is why choosing a sales price or offer price for a home can bechallenging. That’s where the comparable market analysis, or CMA, can be useful.

What is a CMA?The CMA is a side-by-side comparison of homes for sale and homes that have recently sold in the sameneighborhood and price range. This information is further sorted by data fields such as single-family orcondo, number of bedrooms, number of baths, zip codes, and many other factors. Its purpose is to showfair market value, based on what other buyers and sellers have determined through past sales, pendingsales and homes recently put on the market.

The CMA is a side-by-side comparison of homes forsale and homes that have recently sold in the sameneighborhood and price range.

How is the CMA created?CMAs are generated by a computer programsupplied by your real estate agent’s multiple listingservice (MLS). The MLS is available to licensedmembers only, including brokers, salespeople, andappraisers, who pay dues to gain access to theservice’s public and proprietary data, including taxroll information, sold transactions, and listings inputby all cooperating MLS members.

Listing agents generate CMAs for their sellers, andbuyer’s agents create them for their buyers so bothsides know what current market conditions are forthe homes they’re interested in comparing.

How accurate are CMAs?The CMA is a here-and-now snapshot of the market,based on the most recent data available, but it can instantly be rendered obsolete by a new listing, or achange of status in a home with the same criteria. Why? The market is constantly changing – newlistings, pending sales, closed sales, price reductions, and expired listings.

CMAs can vary widely, depending on the knowledge and skill of the person inputting the searchparameters to the software as well as the number and type of data fields that are chosen. That meanssome features may not be included.

As informative as the CMA is, it should only be used as a tool and should not substitute for your realestate professional’s knowledge and advice.






INTROCloud CMA

THE VALUE OF YOUR HOME

In a neighborhood of similar homes, why is one worth more than another? That’s the question that’steased buyers and sellers for ages, but the answer is simple.

Your real estate professional can help you determinethe true value of your home.

Every home is different.When a home is sold, a willing seller and a willingbuyer have just announced to the world the value ofthat home. From there, other similar homes arebenchmarked, but other factors come into play. Themost important are:

Location - The closer a home is to jobs, parks,transportation, schools, and community services, themore desirable it is.

Size - Square footage impacts home values becausethey’re built using more materials. Larger lot sizesmean more privacy.

Number of bedrooms and baths - Over time,median homes have grown larger. Decades ago,household members shared bedrooms and bathswithout complaint, but today, families want moreprivacy. The median home purchased today is athree-bedroom, two-bath home.

Features and finishes - Features such as outdoor kitchens and spa baths make a home more luxurious.A home finished with hardwood floors and granite countertops is going to cost more than a home withcarpet and laminate countertops.

Condition - The closer a home is to new construction, the more it will retain its value. It’s perceived asmore modern, up to date, and perhaps safer. Homes that are not updated or in poor repair sell for less.It’s a good idea for homeowners to keep their homes updated and in top repair.

Curb appeal - From the street, the home looks clean, fresh, and inviting. Fresh landscaping and flowerswon’t change the size or location, but they certainly add charm.

When two homes are identical in the same neighborhood, a higher price may come down to somethingas simple as views, or paint colors, or the overall taste of the homeowner.

Valuing a home will never be an exact science, but if you buy wisely, keep your home updated and ingood repair, you should recoup most if not all of your investment.






INTRO

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INTROCloud CMA

MAP OF ALL LISTINGS

MLS # Status Address Price0 Subject 616 81st Avenue N , Brooklyn Park, MN 554441 4425238 X 7007 Newton Avenue N $174,9002 4431095 X 7616 Scott Avenue N $199,0003 4432775 S 7952 Lad Parkway $169,8004 4436058 S 7416 Lee Avenue N $185,0005 4439706 P 7616 Scott Avenue N $189,9006 4455808 P 6917 71st Avenue N $164,9007 4446267 A 7908 Brunswick Avenue N $183,0008 4452419 A 3433 77th Avenue N $189,9009 4455063 A 1932 Whitewater Trail $189,900

10 4455564 A 3017 84th Avenue N $186,90011 4457442 A 6024 Candlewood Court $189,900






Status: X = Expired, S = Sold, P = Pending, A = Active






ANALYSISCloud CMA

SUGGESTED LIST PRICE

Analysis of the comparable properties suggests a list price of:

$184,900

Here are some other pricing factors to consider:

Low Median Average High Proj. value $/sqftAll listings $164,900 $186,900 $183,918 $199,000 $198,424Active listings $183,000 $189,900 $187,920 $189,900 $204,178Sold listings $169,800 $169,800 $177,400 $185,000 $198,315






INTROCloud CMA

SUMMARY OF COMPARABLE PROPERTIES

Expired Listings

Address Beds Baths YrBlt SqFt List Price Sold Price Sold Date7007 Newton Avenue N 4 2.00 1961 2,000 $174,9007616 Scott Avenue N 4 2.00 1964 2,092 $199,000

Averages 2,046 $186,950

Sold Listings

Address Beds Baths YrBlt SqFt List Price Sold Price Sold Date7952 Lad Parkway 4 2.00 1977 1,920 $169,800 $169,800 Dec 27, 20137416 Lee Avenue N 4 2.00 1968 1,842 $179,990 $185,000 Feb 20, 2014

Averages 1,881 $174,895 $177,400

Pending Listings

Address Beds Baths YrBlt SqFt List Price Sold Price Sold Date7616 Scott Avenue N 4 2.00 1964 2,092 $189,9006917 71st Avenue N 4 2.00 1958 1,812 $164,900

Averages 1,952 $177,400

Active Listings

Address Beds Baths YrBlt SqFt List Price Sold Price Sold Date7908 Brunswick Avenue N 4 2.00 1966 2,010 $183,0003433 77th Avenue N 4 2.00 1977 2,010 $189,9001932 Whitewater Trail 4 2.00 1965 1,800 $189,9003017 84th Avenue N 4 2.00 1978 2,152 $186,9006024 Candlewood Court 4 2.00 1977 1,754 $189,900

Averages 1,945 $187,920






LISTINGS

Status

List Price

Sold Price

List Date

Sold Date

DOM

Year Built

Square Feet

Lot Size

Lot Dims

City

Area

Subdivision

Style

Taxes

Bedrooms

Bathrooms

Garages

616 81st Avenue N ,Brooklyn Park, MN 55444

Subject

184,900

1953

2,100

0

100x400

SUNKIST ACRES

(SF) One Story

1945

4

2.0

1

7007 Newton Avenue N

Expired

$174,900

Oct 25, 2013

85

1961

2,000

0.230

79X125

Brooklyn Center

$2,246

4

2.00

2

7616 Scott Avenue N

Expired

$199,000

Nov 19, 2013

49

1964

2,092

0.260

91x147

Brooklyn Park

Donnays Brookdale Estates

$2,183

4

2.00

2

7952 Lad Parkway

Sold

$169,800

$169,800

Nov 27, 2013

Dec 27, 2013

31

1977

1,920

0.220

0

Brooklyn Park

Lake Terrace Estates

$2,333

4

2.00

2

Cloud CMA

COMPARABLE PROPERTIES

Source: NorthstarInformation is deemed reliable but not guaranteed.


http://images.reinsightdata.com/sasi/addl_picts/4425238_RMLS-1.jpg










LISTINGS

Status

List Price

Sold Price

List Date

Sold Date

DOM

Year Built

Square Feet

Lot Size

Lot Dims

City

Area

Subdivision

Style

Taxes

Bedrooms

Bathrooms

Garages


Subject

184,900

1953

2,100

0

100x400

SUNKIST ACRES

(SF) One Story

1945

4

2.0

1

7416 Lee Avenue N

Sold

$179,990

$185,000

Dec 18, 2013

Feb 20, 2014

22

1968

1,842

0.490

N85X198X160X158

Brooklyn Park

Donnays Brookdale

$2,182

4

2.00

2

7616 Scott Avenue N

Pending

$189,900

Jan 13, 2014

66

1964

2,092

0.260

91x147

Brooklyn Park

Donnays Brookdale Estates

$2,183

4

2.00

2

6917 71st Avenue N

Pending

$164,900

Mar 14, 2014

7

1958

1,812

0.320

100X135X111X134

Brooklyn Park

Park Lane

$1,878

4

2.00

2

Cloud CMA














LISTINGS

Status

List Price

Sold Price

List Date

Sold Date

DOM

Year Built

Square Feet

Lot Size

Lot Dims

City

Area

Subdivision

Style

Taxes

Bedrooms

Bathrooms

Garages


Subject

184,900

1953

2,100

0

100x400

SUNKIST ACRES

(SF) One Story

1945

4

2.0

1

7908 Brunswick Avenue N

Active

$183,000

Feb 10, 2014

43

1966

2,010

0.270

80x120x97x173

Brooklyn Park

Shingle Creek Terrace

$2,180

4

2.00

2

3433 77th Avenue N

Active

$189,900

Mar 4, 2014

21

1977

2,010

0.000

79x148

Brooklyn Park

$3,189

4

2.00

2

1932 Whitewater Trail

Active

$189,900

Mar 12, 2014

13

1965

1,800

0.250

80X141X80X138

Brooklyn Park

$1,706

4

2.00

2

Cloud CMA














LISTINGS

Status

List Price

Sold Price

List Date

Sold Date

DOM

Year Built

Square Feet

Lot Size

Lot Dims

City

Area

Subdivision

Style

Taxes

Bedrooms

Bathrooms

Garages


Subject

184,900

1953

2,100

0

100x400

SUNKIST ACRES

(SF) One Story

1945

4

2.0

1

3017 84th Avenue N

Active

$186,900

Mar 14, 2014

11

1978

2,152

0.260

68x186x78x151

Brooklyn Park

$2,494

4

2.00

2

6024 Candlewood Court

Active

$189,900

Mar 19, 2014

6

1977

1,754

0.250

E131x124x92x71

Brooklyn Park

$1,947

4

2.00

3

Cloud CMA












ANALYSIS

Expired Listings

Number of listings 2

Lowest price $174,900

Average price $186,950

Highest price $199,000

Avg price per sqft $91

Avg DOM 67

Sold Listings






Avg DOM 26

Pending Listings






Avg DOM 36

Cloud CMA

COMPARABLE PROPERTY STATISTICS






Active Listings






Avg DOM 18






ANALYSISCloud CMA

ONLINE VALUATION ANALYSIS

Expired Listings

Address List Price Zestimate Difference7007 Newton Avenue N $174,900 $157,477 -9.96%7616 Scott Avenue N $199,000 $177,199 -10.96%

Sold Listings

Address Sold Date Sold Price Zestimate Difference7952 Lad Parkway Dec 27, 2013 $169,800 $169,209 -0.35%7416 Lee Avenue N Feb 20, 2014 $185,000 $160,548 -13.22%

Sold Averages $177,400 $164,878 -6.78%

Pending Listings

Address List Price Zestimate Difference7616 Scott Avenue N $189,900 $177,199 -6.69%6917 71st Avenue N $164,900 $134,643 -18.35%

Active Listings

Address List Price Zestimate Difference7908 Brunswick Avenue N $183,000 $167,466 -8.49%3433 77th Avenue N $189,900 $163,203 -14.06%1932 Whitewater Trail $189,900 $144,383 -23.97%3017 84th Avenue N $186,900 $183,522 -1.81%6024 Candlewood Court $189,900 $160,761 -15.34%

Source: Northstar


http://www.zillow.com/homedetails/7007-Newton-Ave-N-Brooklyn-Center-MN-55430/1939854_zpid/

http://www.zillow.com/homedetails/7616-Scott-Ave-N-Brooklyn-Park-MN-55443/1955627_zpid/

http://www.zillow.com/homedetails/7952-Lad-Pkwy-Minneapolis-MN-55443/1909475_zpid/

http://www.zillow.com/homedetails/7416-Lee-Ave-N-Brooklyn-Park-MN-55443/1946420_zpid/

http://www.zillow.com/homedetails/7616-Scott-Ave-N-Brooklyn-Park-MN-55443/1955627_zpid/

http://www.zillow.com/homedetails/6917-71st-Ave-N-Brooklyn-Park-MN-55428/1965235_zpid/

http://www.zillow.com/homedetails/7908-Brunswick-Ave-N-Brooklyn-Park-MN-55443/1902875_zpid/

http://www.zillow.com/homedetails/3433-77th-Ave-N-Brooklyn-Park-MN-55443/1909889_zpid/

http://www.zillow.com/homedetails/1932-Whitewater-Trl-Brooklyn-Park-MN-55444/1919162_zpid/

http://www.zillow.com/homedetails/3017-84th-Ave-N-Brooklyn-Park-MN-55444/1918253_zpid/

http://www.zillow.com/homedetails/6024-Candlewood-Ct-Brooklyn-Park-MN-55443/1902587_zpid/

http://www.zillow.com

http://www.zillow.com





ANALYSISCloud CMA

SOLD PROPERTY ANALYSIS

Address List Price Sold Price Difference DOM $ per Sqft7952 Lad Parkway $169,800 $169,800 0.00% 31 $887416 Lee Avenue N $179,990 $185,000 2.78% 22 $100

Sold Averages $174,895 $177,400 1.43% 26 $94






INFOCloud CMA

COMMISSION DISTRIBUTION

Real Estate AgentsNearly nine out of 10 real estate agents work on commission, and are paid only when the transactioncloses. Except for the legal profession, real estate agents are the only fiduciaries and agents who workthis way.

Commissions are paid according to the terms of twocontracts - the listing agreement, and the salescontract.

To simplify how commissions are routed, the realestate industry customarily allows all salescommissions to be paid out of the seller’s proceeds,according to the terms of the listing agreement. Thefive, six or seven percent commission that isnegotiated is given to the listing agent, or listingbroker.

BrokersAccording to licensing law, only licensed brokers canserve as fiduciaries. They have “agents” or licensedsalespeople who work for them, but they have thelegal responsibilities of operating the brokerage. Thesalesperson license allows salespeople to serve asagents of the broker. They can negotiate contracts,but the seller is actually negotiating with the broker,by proxy. It’s the broker’s company name andsignature on the listing contract.

DistributionOnce the home is listed in the Multiple Listing Service (MLS), the listing broker discloses the terms of thecommissions to other competing brokers, so they will bring their buyers to the listing. When the buyer’sbroker presents a contract to the seller, it will include a provision to collect their share of the salescommission, as offered by the listing agent in the MLS.

That means a commission can be split as many as four ways:

• Listing broker or agent• Listing salesperson• Buyer’s broker or agent• Buyer’s salesperson

At closing, the listing agent is paid by the escrow agent out of the seller’s proceeds, or a day or two laterwhen the buyer’s loan is funded by the lender. The listing agent, in turn, pays the buyer’s agent his or hershare of the sales commission.

All commissions are negotiable, but sellers should keep in mind that commissions are incentives.






INFOCloud CMA

WHY YOU NEED A REAL ESTATE PROFESSIONAL

If you’re planning to sell your home, it’s probably crossed your mind to try to sell it yourself and save thesales commission. But, there are some very good reasons why that would be a mistake.

Homes listed by real estate professionals get moreexposure and their sellers get more support.

According to housing industry experts atHomeGain.com and Realtor.org, more homes listedby real estate agents are sold than homes marketedby owners, and they sell more quickly and for moremoney.

Homes listed by real estate professionals get moreexposure and their sellers get more support. Realestate professionals offer many advantages:

• They’re trained and licensed professionals.• They have experience in your neighborhood and

your market.• They have oversight from brokers and state

licensing officials.• Their job is to advise you the best way to reach

your goals.• Their continuing education keeps them up-to-

date on housing issues.• They know how to present your home and deal with buyers.• They know how and where to market properties.• They know how to overcome typical snags that occur in all real estate transactions and closings.• They understand state-required disclosures and look out for your best interests.• They understand personal safety and security for your belongings during showings.• They know the best resources to make transactions go more smoothly, from bankers to home-

stagers to contractors.• They have the most accurate data sources – the MLS, the only data repository that has the most up-

to-date listing and sales information.• They know how to negotiate.• Their job is making real estate transactions successful.

When you market your own home, you have to make the time to do all the jobs a real estate professionalwould do, and you’ll be competing against other sellers who have real estate professionals by their sides.

If you can’t leave work to show your home, or you feel it requires more knowledge and experience thanyou have, you can’t go wrong by hiring a well-respected real estate professional.






INFOCloud CMA

INTELLIGENT PRICING AND TIMING

Pricing a home for sale is as much art as science, but there are a few truisms that never change.

• Fair market value attracts buyers, overpricing never does.• The first two weeks of marketing are crucial.• The market never lies, but it can change its mind.

Fair market value is what a willing buyer and a willing seller agree by contract is a fair price for the home.Values can be impacted by a wide range of reasons but the two largest are location and condition.Generally, fair market value can be determined by comparables - other similar homes that have sold orare currently for sale in the same area.

Sellers often view their homes as special which tempts them to put a higher price on the home, believingthey can always come down later, but that’s a serious mistake.

Overpricing prevents the very buyers who are eligible to buy the home from ever seeing it. Most buyersshop by price range, and look for the best value in that range.






INFOCloud CMA

INTELLIGENT PRICING AND TIMING

Your best chance of selling your home is in the first two weeks of marketing. Your home is fresh andexciting to buyers and to their agents.

With a sign in the yard, a description in the local Multiple Listing Service, distribution across the Internet,open houses, broker’s caravan, ads, and email blasts to your listing agent’s buyers, your home will getthe greatest flurry of attention and interest in the first two weeks.

If you don’t get many showings or offers, you’ve probably overpriced your home, and it’s not comparingwell to the competition. Since you can’t change the location, you’ll have to improve the home’s conditionor lower the price.

Consult with your agent and ask for feedback. Perhaps you can do a little more to spruce up your home’scurb appeal, or perhaps stage the interior to better advantage.

The market can always change its mind and give your home another chance, but by then you’ve lostprecious time and perhaps allowed a stigma to cloud your home’s value.

Intelligent pricing isn’t about getting the most for your home – it’s about getting your home sold quickly atfair market value.






INFOCloud CMA

CURB APPEAL, A FIRST IMPRESSION THAT LASTS

First ImpressionsMost buyers form their first impression of your home before they even get out of their cars. This is “curbappeal,” or the view from the curb that tells the buyer how attractive and well-maintained your home iscompared to other homes. In a competitive market, it takes more than trimming the hedges and plantinga few flowers to create curb appeal.

It takes more than trimming the hedges and planting afew flowers to create curb appeal.

The exterior of your home must be in pristinecondition – freshly painted, cleared of clutter, withno visible repairs needed. A broken step, overgrownbush, or abandoned toys in the yard can spoil theappearance and your buyer’s first impression.

Curb AppealCurb appeal is important because it sets the tone forwhat the buyer is going to see inside. If the buyerlikes the exterior, he or she will be predisposed toalso like the interior and you’re that much closer toselling your home. To see what needs to be done tosell your home faster and for a higher price, gooutside, stand on the curb and try to look at yourhome the way the buyer will.

Walkways/driveways - Make sure walkways areclear of snow, weeds, or debris. Repair or replacecracked steps or pavers. Driveways should also beclear of vehicles, toys and debris. Park cars in thegarage.

Landscaping - Keep your lawn mowed, edged andwatered. Prune dead branches and plants. Weed flower beds and replace leggy, thin landscaping withfresh plants and flowers.

Exterior - Replace loose or damaged roof shingles, clean the gutters, and paint and caulk window trimand doors. Repaint the front door an eye-catching color that complements the rest of the exterior.Replace broken windows.

Entry - Power wash siding, brick, windows, and porches. Paint or replace furniture such as rockingchairs or porch swings. Replace mailboxes, light fixtures, door knobs or any other fixture that looks lessthan fresh. Put out a welcoming new floormat.

Some parts of your home may require more work than others, but it’s well worth it to get buyers eager tosee what’s inside.






INFOCloud CMA

SELLING YOUR HOME IN A TOUGH MARKET

When home prices fall, supplies of homes for sale increase, and buyers become more demanding, it’s abuyer’s market. That doesn’t mean you can’t sell your home for a fair price. You just have to work harderto make it happen.

A real estate professional can give you an accurateoverview of the market.

A buyer’s market is not the time to representyourself. It may be tempting to recoup some equityby not paying a real estate agent, but you’ll losemore than you’ll gain. A real estate professional cangive you an accurate overview of the market, helpyou with strategies, and bring offers from qualifiedbuyers.

Make your home pristineIn a buyer’s market, only location and condition canmove buyers to pay more for any home. You can’t doanything about location, but you can take conditionout of the equation. There’s a huge differencebetween a home that “doesn’t need a thing” and ahome that “needs work.” Show pride of ownership byputting your home in top move-in condition so thatyour home is more appealing to buyers than anyother home in your price range.

Price it rightYou can expect lowball offers in a buyer’s market,but homes that are priced fairly and in pristinecondition will be treated with more respect by buyers.Pricing according to recent sold comparables mightnot be as smart as pricing to pending sales – those yet to close. You have to know what your bottom lineis, but pricing your home should have nothing to do with how much you owe creditors, how much cashyou need to buy your next home or how much you need for your retirement or any other reason. Buyerswill only pay current or pending market value as determined by the most recent comparables.

Keep negotiations pleasantNegotiation is a fine art, and typically works best when both parties get what they want. For example, youmay be willing to take less money in exchange for a cash offer or a quicker closing. Your buyer may bewilling to pay your asking price, but they may ask you to pay their closing costs. You’ll quickly realize ifyou’re dealing with a sincere buyer. Respond to the buyer's negotiations with documentation, receiptsand other information in a timely manner. If you feel the buyer isn’t negotiating in good faith, simply stopnegotiations. You’re under no obligation to respond to an unreasonable offer. The buyer will get themessage. Buyer’s markets work for sellers, too. Keep in mind that when you buy your next home, you’llbe able to take advantage of falling prices, too. Think about the future – that you can repurchase morehome for less money next time. It all evens out.






INFOCloud CMA

NEGOTIATING WITH BUYERS

Sellers today have to do more to attract buyers and offers than ever before. When offers come in,sometimes they are low or have conditions that have to be negotiated. As a seller, you can be proactivebefore the offers come in to make sure negotiations are kept to a minimum and in your favor.

Price your home to sell at or below current marketcomparables and you’ll more likely receive seriousoffers close to your asking price.

Negotiate by planning aheadBefore you begin negotiations with any buyer, makesure you have the upper hand by removing anysticking points in advance.

Price your home to sell at or below current marketcomparables and you’ll more likely receive seriousoffers close to your asking price. Put your home inspotless move-in condition, with no visible repairsneeded. De-clutter your home, deep clean it, paint itand repair it, and keep it “show-ready” every day it’son the market. Get your home inspected so youknow where issues are and can correct them beforethey become negotiating points that cost you money.

Buyers respond well to fair pricing and a “modelhome” appearance. Your buyer has less to negotiate,and will more likely make an offer closer to askingprice.

When the offer comes inBuyers sometimes test sellers with low offers, but don’t get upset or discouraged. If the offer is too low,simply have your agent return the offer with a copy of recent comparables to show that your home ispriced fairly at current market value. They will get the message, and either come back with a reasonableoffer, or move on to another home. If the offer is low, but close to what you want, study the termscarefully, adding up possible expenses such as paying the buyer’s closing costs. Ask for the buyer’sreasoning behind the offer to give you insight into the buyer's mindset. Could the buyer be trying to buymore house than he or she can afford? Could a change of financing help get closer to your price? Canyou afford to help with the buyer's closing costs if he or she will raise the offer price?

Before you agree, make sure the buyer is preapproved with a lender and working with a real estateprofessional. Serious buyers have access to the same comparables as you do, so a buyer working with areal estate professional is more likely to be preapproved by a lender and informed of current marketconditions. A full price offer doesn’t mean negotiations are over. It could signal that the buyer intends tonegotiate a lot of repairs or refurbishing costs during the inspection period. Stay calm and reasonable.

If you’ve done your homework – priced and prepared your home for the highest, best offer, your homewill sell at a fair price.






INFOCloud CMA

ONLINE HOME VALUES AND YOUR HOME

Plenty of sellers have visited online home valuation sites such as Zillow, Trulia, eAppraisal, and othersonly to be shocked at the value of their homes.

Most sellers are pleased when the values appear higher than they expected, but many online valuationscome in far lower.

Ask your real estate professional for a comparativemarket analysis, or CMA.

Online ValuationsEstimating a home’s market value is far from anexact science. What these sites attempt to do isprovide greater transparency to homebuyers andsellers by making data derived from public records,more…public. They publish what you paid for yourhome and how much you pay in taxes. Many havesatellite views so accurate they can spot your catlaying on the front porch.

How do they do it? Home valuation sites contractwith major title companies such as First American toobtain county tax roll data. All property is registeredwith the county for property taxing purposes. Theyalso find ways to become members of local multiplelisting services, which are either subsidiaries of realestate associations or owned by local real estatebrokers. That way, they have access to listing data.

Between tax roll data and listing data, home valuation sites apply their own secret sauce, or algorithm tocome up with “zestimates” or approximate values of what homes are worth.

Sometimes the results are spot on, but they can also be terribly inaccurate. First, transaction data has tobe recorded with the county, which could take weeks. But, what alters the algorithm most is thatproperties not currently on the market are included in the data. The algorithms can’t possibly showwhether or not a home has been updated, how well it’s maintained, or esoteric values such as curbappeal and views.

For that reason, online valuations should be used only as one of many tools to estimate a home’s value.

Ask your real estate professional for their expert analysisAsk your real estate professional for a comparative market analysis, or CMA. He or she can show youthe most recent listings and sold comparables, accurate to within hours or a few days at most

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INFOCloud CMA

HOW CMAS CAN VARY

Whether you are buying or selling a home, your real estate professional can give you a snapshot of thelocal market known as the competitive or comparative market analysis or CMA.

A CMA helps the seller choose a listing price and thebuyer to make an offer.

CMAs are generated from multiple listing service data.They’re convenient reports that help sellers choose alisting price and buyers to make offers on a givenhome.

CMAs vary greatly depending on the searchparameters that are input by the real estateprofessional, by type of home (detached vs. attached),zip code or by street, number of bedrooms, baths andliving areas, square footage, and numerous othersearch criteria.

They also tell you which homes have recently sold - sixmonths, three months, one month, and which homesare currently on the market in the area and price rangeyou’re interested in. As many fields of information asthere are, some criteria simply can’t be listed in a CMA.If the MLS has a field for “ocean views,” you’ll know.But if not, you’ll have to learn more in the remarkssection that is filled in by the listing agent. There youmight find “great views.” But who is to say what makesa great view?

CMAs results may vary even between identical homesOne property may simply offer better drive-up appeal or is in better condition than the other, and that willbe reflected in the sales price.

Last, buyer and seller motivation can’t be quantified. You don’t know why a seller agreed to take less fortheir home or why a buyer paid more for another home. Family problems, corporate relocations and otherreasons all play a role. What you can learn from the CMA is how long the home took to sell. If it wasquick, the seller was highly motivated. If it didn’t, it was probably overpriced.

CMAs are ToolsFor these reasons, CMAs are not home valuations. They are tools to use alongside your real estateprofessional’s knowledge of the market. They may have house-to-house knowledge of the market and beable to tell you why they think one home sold for more than another.






INFOCloud CMA

CMAS VS APPRAISALS

Market Value

Your home’s market value is equally important tobuyers, sellers, lenders and real estate professionals.

Establishing a home’s market value is equallyimportant to buyers, sellers, lenders and real estateprofessionals so that transactions can proceedquickly and efficiently. A real estate professional mayprepare a comparative or comprehensive marketanalysis (CMA) for their sellers to help them choosea listing price. The CMA includes recently soldhomes and homes for sale in the seller’sneighborhood that are most similar to the seller’shome in appearance, features, and general pricerange.

Home ValueAlthough the CMA is used to help determine currentmarket value, it does not establish the seller’s home value. In fact, the seller’s home is typically not evenfeatured in the CMA. The CMA is merely a guide to help the seller learn what’s happening in their localmarket, so they can better understand where their home fits in term of price ranges, based on location,features and condition. Once the home is listed on the open market, a buyer makes an offer, usuallybased in part on a CMA the buyer’s agent has prepared. CMAs can help buyers better understand thelocal market as well as sellers. If the buyer is receiving financing through a bank, the bank will order anappraisal. Unlike the CMA, a bank appraisal is a professional determination of a home’s value. It’sperformed by a licensed appraiser, using guidelines established by the Federal Housing FinanceAgency, which regulates federal housing loan guarantors such as FHA, VA and housing loan purchasersFannie Mae and Freddie Mac.

AppraisalAn appraisal is a comprehensive look at a home’s location, condition, and eligibility for federalguarantees. For example, a home that doesn’t meet safety requirements such as handrails on steps willnot be eligible for FHA or VA loans until the handrail is installed or repaired. Appraisers use the samedata in their market research to find comparable homes as REALTORS® do. They are also members ofthe MLS, but they also have additional guidelines from the bank to follow that minimize risk to the bank.They may take off value for slow-moving markets, or markets with high rates of foreclosures. If prices arefalling, the appraiser takes the number of days a home has been on the market far more conservatively.

When the appraisal is finished, the bank makes the decision to fund the loan, or it may require the sellerto fix certain items and show proof that the repairs have been made before letting the loan proceed. If theloan doesn’t meet lending guidelines, the bank will decline the loan. Despite stricter lending andappraisal standards, most buyers’ loan applications go through to closing – nearly 85 percent. Onereason for that is that real estate agents are preparing CMAs that are better tuned to lending standards,for sellers and buyers to better understand not only what the market is doing, but how much lenders arewilling to finance.




