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How To Do A CMA In Real Estate (With Adjustment Examples)

Ensuring the right pricing for a property can make the difference between a swift sale and an extended listing. But how do real estate professionals determine the optimal price point in a constantly fluctuating market? Enter the Comparative Market Analysis (CMA) – a vital tool that provides insights into the current property market by comparing similar properties in the same locale.

A CMA doesn’t just provide a snapshot of the current market; it offers a comprehensive understanding, allowing real estate professionals to adjust property prices based on tangible data, ensuring a competitive edge in listings. Whether you’re a seasoned realtor or just getting started in the industry, understanding how to perform a CMA is crucial.

In this article, we’ll show you how to do a CMA in real estate. We’ll delve into the intricacies of what a real estate CMA is, walk you through the step-by-step process of conducting one, guide you in making informed CMA adjustments, and address several frequently asked questions. By the end, you’ll be well-equipped to harness the power of CMAs, setting the stage for successful real estate transactions.

How To Do A CMA In Real Estate

What Is A Real Estate CMA (Comparative Market Analysis)?

A CMA in real estate is a report that examines the prices of properties that are similar (comparable) to a subject property to determine its approximate value in the current market. While not as formal as an appraisal, a CMA uses similar methodologies and can offer valuable insights into local market conditions.

If you are a real estate agent representing a buyer, or a listing agent trying to determine the appropriate listing price for a property, conducting a Comparative Market Analysis (CMA) is an essential step in understanding the market value of a home.

CMA Quick Facts:

  • The goal of a CMA is to provide an accurate assessment that helps real estate agents or sellers determine the appropriate listing price for a property.
  • To conduct a CMA, you need access to reliable MLS (Multiple Listing Service) data and knowledge of the local real estate market.
  • CMA reports typically include information on comparable properties, such as their size, condition, location, and recent sale prices.To determine the most accurate market value of a property, real estate professionals often rely on the use of “comps,” or comparable properties, which are similar in size, condition, location, and recent sale prices, as these comparisons are essential in performing a Comparative Market Analysis (CMA). 
  • The analysis may also consider factors like market trends, neighborhood amenities, and any unique features of the property being evaluated.
  • While real estate professionals often perform CMAs, homeowners can also attempt to do it themselves using online tools or software programs designed for this purpose.
  • An accurate CMA requires attention to detail and the ability to interpret market data effectively.
  • The results of a CMA can be used by sellers to set an asking price that attracts potential buyers while maximizing profit.
  • Real estate agents often use CMAs as part of their marketing strategy to demonstrate their expertise and provide clients with valuable information about the local market.

How To Do a CMA in Real Estate

1. Define the Subject Property

Before you can find comparable properties, you need to understand the property you’re evaluating. Gather all relevant details:

  • Address
  • Size (square footage)
  • Number of bedrooms and bathrooms
  • Lot size
  • Age of the property
  • Unique features (pool, garage, recent renovations and upgrades)

2. Set Criteria for Comparables

It’s crucial to find properties that are as similar as possible to the subject property. Consider the following:

  • Location: Ideally within the same neighborhood or a nearby area with similar characteristics.
  • Size: Within 10-20% of the square footage of the subject property.
  • Age: Properties built around the same time.
  • Features: Comparable amenities and updates.

3. Gather Data on Recent Sales

Using the Multiple Listing Service (MLS) or other real estate databases, pull up recent sales that match your criteria. Ideally, focus on properties sold in the last 3 months.

4. Analyze Active, Pending, and Expired Listings

Besides sold properties, it’s beneficial to look at:

  • Active Listings: Properties currently on the market can give insights into current competition.
  • Pending Listings: Homes under contract can indicate where the market is heading.
  • Expired Listings: Properties that didn’t sell can provide insights into overpricing or other market challenges. See our REDX review and these expired listing scripts to see how you use these to get seller leads.
  • 5. Adjust for Differences

No two properties are the same. Make adjustments for any differences between the subject property and the comparables. For example, if the subject property has a renovated kitchen, but a comparable does not, you might add value to the subject property or subtract from the comparable. Does one house have a brand new roof and the other comp need a new roof?

6. Calculate the Price Per Square Foot

To calculate the price per square foot for a property:

  1. Obtain the sales price of the property.
  2. Obtain the total square footage of the property.
  3. Divide the sale price by the total square footage.

This gives you a benchmark to compare properties and helps in determining a price range for the subject property. Further reading: 70% Rule Calculator

7. Determine a Price Range

Using the adjusted prices of your comparables and the price per square foot calculations, determine a potential price range for the subject property. This range will give your clients a realistic expectation of what they can achieve in the current market.

Do your research to come up with an educated property value. Real estate agents shouldn’t use Zestimates when doing a CMA! Zillow pricing doesn’t always reflect the current condition of a property. A well researched CMA will build trust with your buyer or seller.

8. Create a Comprehensive Report

Compile all your findings into a detailed report. This should include:

  • A summary of the subject property.
  • Details and adjusted prices of each comparable.
  • An explanation of your methodology.
  • Your recommended price range for the subject property.

Tips for a More Accurate CMA

  1. Stay Current: Real estate markets are competitive and can change rapidly. Ensure your data is recent.
  2. Use Multiple Sources: While MLS is a primary source, also consider using local property records, online real estate platforms, and even appraisals.
  3. Visit Properties: If possible, visit comparables or attend open houses. Photos and listings don’t capture everything.
  4. Continuously Educate Yourself: Attend local real estate seminars, workshops, and courses to stay updated on market trends and CMA methodologies.

Making CMA Adjustments: A Deep Dive

Adjustments are a crucial component of a Comparative Market Analysis (CMA). Since no two properties are identical, adjustments help to level the playing field and make the comparison between the subject property and the comparables more meaningful. The goal is to determine what the subject property might have sold for if it had the same features and qualities as the comparables.

1. Why Are Adjustments Necessary?

A subject property and a comparable might have differences in features, age, size, condition, location, and more. Adjustments account for these discrepancies by adding or subtracting value to the comparables. Essentially, we’re answering the question, “What would the sale price of the comparable be if it were identical to the subject property?

2. Types of Adjustments

  • Feature Adjustments: Differences in amenities like a swimming pool, a garage, or a fireplace.
  • Size Adjustments: Differences in the overall size or the number of rooms.
  • Condition Adjustments: Differences in the overall condition or age of the property.
  • Location Adjustments: Differences due to being closer/further from amenities or undesirable features (e.g., a busy road).
  • Date of Sale Adjustments: The property market can change over time. If a comparable sold many months ago, its price might need to be adjusted for current market conditions.

3. How to Make Adjustments

  • Determine the Value of the Feature: Start by determining the value of a specific feature in the local market. This can be done by looking at properties with and without the feature and observing the difference in sale price. For example, if homes with a pool sell for an average of $20,000 more than those without it, then the value of a pool is approximately $20,000 in that market.

  • Apply to the Comparable: If the comparable lacks a feature that the subject property has, add the value of that feature to the comparable’s sale price. If the comparable has a feature the subject property lacks, subtract the value.

    Example: If the subject property has a pool and a comparable doesn’t, add $20,000 to the comparable’s sale price.

  • Repeat for Each Feature: Go through each difference between the subject property and the comparables, making adjustments as necessary.

4. Adjusting for Size

This is typically done on a price-per-square-foot basis. If the average price per square foot in the area is $200 and the comparable is 100 sq ft larger than the subject property, you would subtract $20,000 from the comparable’s sale price.

5. Adjusting for Condition

This can be more subjective. However, if you know that renovated kitchens in the area add about $15,000 to a home’s value and the comparable has a renovated kitchen while the subject property doesn’t, you’d subtract $15,000 from the comparable’s price.

6. Adjusting for Location

If a comparable is next to a busy road and properties next to this road typically sell for $10,000 less, you’d add $10,000 to the comparable’s price if the subject property isn’t next to a similar road.

7. Consider Cumulative Adjustments

Remember, adjustments can compound. If you’re making multiple adjustments to a single comparable, ensure you’re considering the overall adjusted price, not just individual features.

Making accurate adjustments is both an art and a science. It requires a deep understanding of the local market and the nuances that influence property values. By carefully considering each adjustment and being consistent in your approach, you can provide a more accurate and persuasive CMA for your clients.

How To Create a CMA in Stellar MLS (Matrix)

Creating a Comparative Market Analysis (CMA) in Stellar (also know as Matrix), which is a popular Multiple Listing Service platform used by many real estate professionals, involves several steps. Here’s a step-by-step guide on how to create a CMA in Matrix:

Step 1: Log In to Stellar

Access your Stellar account by logging in with your credentials on the appropriate website. Your access credentials are usually provided by your real estate association or brokerage.

Create a CMA in Stellar (Matrix)

Step 2: Start a New CMA

Once you’re logged in, navigate to the CMA section. Look for a button or link that says “My CMAs” and then just click on “Start a New CMA.”

Step 3: Enter Subject Property Information

You will be prompted to enter and contact & information about the subject property. This includes the address, property type, square footage, number of bedrooms and bathrooms, and any other relevant details. Be as accurate as possible, as this information sets the foundation for your CMA. I suggest using the Property tax ID and it will pre-fill most of this information for you automatically.

Step 4: Select Comparables

Stellar (Matrix) allows you to search for and select comparable properties. Use the criteria you’ve set (location, size, features, etc.) to find appropriate comparables. Matrix’s search functionality can help you filter properties based on your predefined criteria.

Step 5: Review and Adjust Comparables

Once you have a list of potential comparables, review each one. Make any necessary adjustments for differences between the subject property and the comparables, as discussed in the previous section on adjustments.

Step 6: Determine Valuation Range

Based on your adjusted comparables, determine a valuation range for the subject property. Stellar might have tools to help you calculate this, including averages and median prices.

Step 7: Customize the CMA Report

Matrix typically allows you to customize the final CMA report. You can add your branding, choose which pages to include, and decide how much detail to provide. Customize the report to best serve your client’s needs and to present the information clearly and professionally.

Step 8: Review and Finalize

Carefully review the entire CMA report. Check for accuracy, clarity, and completeness. Once you’re satisfied, save the report, and it’s ready to be presented to your client.

Step 9: Present the CMA to Your Client

Schedule a meeting with your client to go over the CMA. Be prepared to explain your methodology, the comparables you chose, and why you made certain adjustments. This will help your client understand the market value of their property and assist them in making informed decisions.

Creating a CMA in Matrix requires attention to detail and a solid understanding of the local real estate market. By leveraging the tools and data available in Matrix, you can produce a comprehensive and accurate CMA that will be an invaluable asset to your clients. Remember to continually educate yourself on market trends and CMA methodologies to enhance the quality of your reports.

Interesting Stats About CMAs

  1. On average, real estate agents spend approximately 2 hours preparing a Comparative Market Analysis (CMA) for each property listing.
  2. Over 90% of CMAs include a detailed analysis of at least 10 recently sold properties in the same neighborhood.
    Approximately 75% of CMAs take into account specific property features, such as the number of bedrooms, bathrooms, and square footage.
  3. Nearly 80% of CMAs provide an estimated market value range for the property being analyzed.
  4. According to industry surveys, more than 60% of home sellers rely on their agent’s CMA when determining the asking price for their property.
  5. On average, CMAs result in a final sale price within 97% of the original list price.
  6. Approximately 40% of CMAs consider current market trends and factors such as supply and demand in the local area.
  7. Over 50% of CMAs incorporate digital tools and software to enhance accuracy and presentation.
  8. A recent study found that properties priced within 5% of the CMA’s recommended price sold within an average of one month on the market.
  9. About 85% of real estate agents believe that conducting a thorough CMA significantly increases their chances of securing a successful sale.


What are some best practices for presenting the findings of a CMA to clients or stakeholders?

When presenting CMA findings, clarity is paramount. Start with an executive summary to provide a snapshot of your conclusions. Utilize visual aids such as charts, graphs, and maps to illustrate data points and trends.

Tailor your presentation to your audience; a homeowner might prefer a straightforward overview, while an investor may seek detailed analysis. Always be prepared to answer questions, and practice active listening to address any concerns your client or stakeholder might have.

What impact does location have on the accuracy of a real estate CMA?

Location plays a pivotal role in a property’s value, often coined as “location, location, location” in real estate. Even minor differences in location, such as being on a main road versus a quiet side street or the quality of local schools, can drastically affect property values.

For a CMA to be accurate, it’s essential to use comparables from the same neighborhood or a very similar area. Additionally, understanding local nuances and attractions can offer deeper insights into value differences.

What tools or software can assist with performing a CMA?

Several software tools can aid in CMA preparation. Matrix is a widely-used MLS platform with CMA functionalities. Dedicated CMA software solutions, like Cloud CMA or HouseCanary, focus on creating detailed CMA reports.

Additionally, platforms like Zillow Premier Agent offer tools that can assist in gathering data and insights for a CMA.

Where can I learn about the different approaches to valuing properties in a CMA in real estate?

There are multiple methodologies for property valuation in a CMA, ranging from the sales comparison approach to more complex regression analyses.

Real estate valuation courses, textbooks, and industry webinars offer deep dives into these methodologies. Experienced appraisers and real estate professionals can also provide insights based on their hands-on experience with various valuation techniques.

What factors should I consider when conducting a CMA?

When conducting a CMA, consider factors such as property size, location, condition, age, unique features, and recent sale prices of comparables.

Additionally, market trends, property improvements, and local nuances like school zones or proximity to amenities can influence property values and should be taken into account.

How do I determine the value of improvements in a CMA?

Determine the value of improvements by comparing properties with and without the specific improvement in the same area.

For instance, if homes with a renovated kitchen sell for an average of $20,000 more than those without, that gives an approximate value for a kitchen renovation. This method requires analyzing multiple properties to derive a consistent value estimate for specific improvements.

Should I consider pending sales in my CMA analysis?

Pending sales can be considered in a CMA as they provide insights into the current market direction. However, they should be used cautiously since the final sale price isn’t confirmed and may differ from the listing or pending price. It’s essential to note the potential volatility of pending sales data when presenting findings.

How to analyze market trends in a real estate CMA?

Analyzing market trends involves reviewing historical sales data, understanding price movements over time, and considering factors like inventory levels, days on market, and the buyer-seller balance.

Resources like local market reports, industry publications, and data from real estate associations can provide insights into broader market trends that should be factored into a CMA.

Who offers online courses on conducting CMAs in real estate?

Real estate education platforms, such as the Colibri Real Estate, Aceable Agent, The CE Shop, and the National Association of Realtors (NAR), often offer online courses dedicated to CMAs. These courses provide structured learning, practical examples, and often come with certifications or continuing education credits.


A well-prepared CMA is invaluable for real estate professionals. It offers objective, data-driven insights into the local property market, enabling agents and their clients to make informed decisions.

While the process might seem complex at first, with practice and due diligence, you can master the art of conducting an effective CMA.

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