As a seller of residential properties, you need to know the appropriate value that you need to tag a particular house with so that all the stakeholders of the transaction can benefit from the rate that you will apply. This will also allow you to be more competitive and at the same time desirable in the market. If you are already planning to list a home for sale, one of the things that you need to do is to implement comparative market analysis.
A comparative market analysis is a document that provides information about a property’s value. This report is commonly based on the comparison of your home to properties with almost the same worth, value or features. The comparative market analysis differs from one another which varies on how sellers or real estate agents prepare the document.
Content of Comparative Market Analysis
Just like a market analysis – demand and supply but used in a more specific manner, a comparative market analysis contains details that are gathered from different points of views relevant and related to home listing and selling. If you want this document to be used to its maximum potential, you have to ensure that you will come up with a comprehensive review of the details that should be placed in a comparative market analysis. Listed below are the details that should be present in a comparative market analysis.
- One of the first information that should be seen in a comparative market analysis is the active listing of the residential units and properties for sale. It is essential for this information to be present as it can give you an idea of the advantages or disadvantages that you have with your competition. This will help you to know the kind of properties that the market is up for buying.
- If you want to have a stronger comparison for selling potential, then it is imperative for you to have a sold listing or a list of the properties that have been sold within the previous months in the same market where you currently are. Comparative sales can make it easier for you to identify whether you are still in the appropriate price range that is deemed to be desirable by prospective buyers.
- The comparable sale for the listings that are pending should also be seen in the document. Keep in mind that home sale prices are not the actual prices of a property. As long as they are still not sold, you cannot ensure that the price is already the rate that you should also provide.Though sold listings are more valuable as actual information, having pending lists of home sales can still be helpful. The reason why this is relevant is that pending sales transactions can actually help you to know the market movement.
- An off the market listing can also help you when it comes to creating sound decisions about selling a home. If you have this kind of list, you can easily sell the properties that have been taken off the market may it be due to the decision of the seller to withdraw the property or the desire of buyers to get another property instead due to the high price point of the home being removed. Issues with agents and the like can also be the reason why a particular property is in the off-market list.
What to Remember while Creating Comparative Market Analysis
A comparative market analysis can make a lot of difference on how home sellers decide about actually selling a home. If you want to come up with an effective comparative market analysis, you have to be knowledgeable on how the entire comparison process works. Here are some of the things that you need to remember while creating a comparative market analysis:
- A comparative market analysis is composed of information that will depend on the kind of house that you are selling. This means that it can go from a short and precise document up to a detailed long list of market analysis. Identify the kind of comparative market analysis that you need based on the requirements of the property that you will sell.
- Maintain a list of comparable sales so that you can easily get the idea of how you will market the property. Comparable sales can actually be gathered in the market where there is a presence of homes with the same features and psychical conditions as your property.
- Know that there are different factors that can affect a comparative market analysis. This is the reason why you need professional help when it comes to looking at properties that will serve as your references when it comes to comparing the home that you want to place in the market. Location, for instance, is one of the things that can make a difference even if the actual property has the same features of another home located in a different community.
- Make the listing organized as a comparative market analysis should be precise and direct to the point. It should have all the essential comparisons that you need to be aware of. More so, you should make sure that all the details in the comparative market analysis are updated.
Having a comparative market analysis is one of the things that you need to have as a property seller. Even if you can easily come up with a price point that you desire for your home, it is still essential for you to ensure the high selling possibilities of the property by being guided by certain standards present in the industry.
There are existing samples and templates of comparative market analysis that you can use to make the specified document in a more efficient and faster manner. As we have mentioned above, it will be best if you will seek professional advice and help when identifying the details that should be included in a comparative market analysis. Since you are already aware with the basic knowledge about comparative market analysis through the content of this post, the next thing that you can do is to review actual documents so you can have an idea on what to expect should you already decide to sell a property.