A comparative analysis or realtor market analysis allows you to establish the sale or rent price. The market is willing to pay and thereby offer the owner an opinion of value.
Every time a real estate broker closes a property, they can set the price. The price a client rented or sold. Therefore, the saved price is a record that you can get in the area. Anytime you refer, you can use it.
One of the most frequent and important tasks of your work as a real estate agent is to study the realtor market analysis. Considering this analysis would help you have the right prospect from the value of a property.
In a market with so many properties and price-informed buyers, it is important to choose a competitive sale price. Since getting more listings is in close connection with the price you offer.
There are at least three values for the properties:
To complete the sale in a reasonable time, it is necessary to know how to anticipate what is the value that the buyer is willing to pay. One of the most effective ways to anticipate this thinking is by conducting a Comparative Market Analysis (CMA).
The Comparative Market Analysis is an analysis of the properties currently offered on the market that are in direct competition with the one you want to sell.
A buyer will consider many options before choosing, especially if it is real estate. How do you discard? Well, just analyze some buying indicators. Here the art of realtor market analysis plays its role.
We need to find the ideal supply-demand relationship. Thus, it can be the first reason for us to do the realtor market analysis. Additionally, you can carry out the sale in the shortest possible time, at the best possible price, and with the best possible conditions.
A good CMA helps us to anticipate the analysis that the buyer will make in his head. Consequently, you can determine a competitive market value, and choose your creative real estate marketing strategies.
It gives us a picture of the market at a specific time, under specific conditions. It is essential to include the comparable properties sold in the last month.
Here we will teach you how to make a realtor market analysis through a Comparative Market Analysis (CMA) in 5 easy steps. You will be able to determine the realtor market value of a property and generate a report that allows you to communicate that value to your clients in a professional way.
Neighborhood real estate agents know the market so well. They could value home without checking it with similar home sales. Their knowledge relies on experience and the characteristics of the homes. Therefore, orientation, views, need for reform, energy rating, and accessibility remain important.
Besides, when it comes to luxury homes and some other specific factors that are important to the buyer. These factors are proximity to fashionable restaurants, adequate space in the garden for the pets, space for the pool, etc. They may seem superfluous but are decisive for some people.
These factors are incorporated by the consumer himself into the market analysis. A client applies them on his own weighting, to achieve an assessment. It maintains variables based on characteristics. Besides, it is finally personalized and subjective.
That customization that owners and buyers have access to is the greatest ovation in market analysis. The power to determine prices no longer depends solely on appraisal companies, land registry or notaries. The new factors that are introduced in the evaluations are determined by each individual.
Users can adjust the valuation parameters and compare them with other homes. Parameters such as the age of the building, the level of economic activity in the area, views, luminosity, state of the interior and exterior, size of the common and private elements, level of privacy, vicinity noise level are taken into account.
The result of the valuation is tighter than that provided by an automated valuation tool, with a closed algorithm.
The cost of use in a home is one more factor to take into account. To calculate it, it is necessary to be able to adjust the valuation algorithm. Therefore, the number of people living in the house, the occupation time during the day, the desired temperature level in each season of the year are important factors, as well.
As common expenses, we refer to electricity, gas, and water mains. They vary depending on the use of heating, air conditioning, and irrigation systems.
A reform in the piping system, heating the insulation, can reduce the total cost of common expenses. Thus, it can be placed below the average of the surrounding homes. This cost of the reform and the possible repairs and spare parts must also be taken into account in the valuation.
The difference in common monthly costs may suggest the buyer purchases a higher value home. Hence, it can be an excellent choice due to the savings that this home brings in energy efficiency year after year.
To sum up
This article is a practical guide for a better consideration of realtor market analysis. Besides, we tried to clarify the comparative market analysis. We suggested some tips for a better analysis as well.