CMA

[Dan Green]

I'm very new to real estate and I'm still trying to gather all the info I need to be a great real estate agent. I will be getting my license next week. I really need to know how to prepare a CMA and if anyone can give me some knowledge, that would be great.

[Hattie Dizmond]

The technicalities of it depends upon the software you're using. However, I can give you the guiding principals I use...

1.  Only use sold listings, not pending, not active, because you have no idea what the sale price will be. 

2.  I try to never go back more than 6 months. The more recent the better. Ideally I try to keep it within the last 3 months. 

3.  3 to 5 properties

4.  Make sure you are comparing apples to apples.  i.e. a 2 BR house in a family neighborhood should not be compared to 3 and 4 BR properties. 

5.  Make sure you understand the value of different amenities in the specific neighborhood and what finishes are expected in that neighborhood. When you start comparing properties, you're going to need to adjust prices to compensate for differences.  The most important adjustments will generally be for things like an extra bedroom or a lack of a 4th bedroom. In Florida not having a pool in nicer areas is a huge drawback. You get the point. 

6.  Location matters...

7.  Don't cross thoroughfares...major streets and roads that segment neighborhoods.

8.  Don't cross organic boundaries (creeks, linear parks, etc, unless you are certain the neighborhood doesn't 'shift' across the boundary)  

9.  Particularly in suburban, family areas, make sure the properties all feed to the same schools. (In our neoghborhood, 5 houses to the east of us is $50k less, because it feeds a different elementary...just saying.)

10.  Visit lots of open houses.  Open houses for flips and new development in a neighborhood is even better, because you can get a feel for the finishes people will be expecting. Know the competition. 

11.  Always stay slightly conservative. 

Hope that helps.