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Difference Between a Home Appraisal and a CMA

A Comparable Market Analysis is a report compiled by a real estate agent to determine the market value of a given property. The value is determined by comparing the home to other properties of similar size and amenities in the nearby neighborhood, and what they sold for. As CMAs can be requested for free from local realty offices, sellers often use them to determine the price point for their home.

An appraisal is a survey of your home, conducted by a licensed professional, to determine the property value as compared to other properties. The appraisal report details the condition, zoning and tax data, and average sale price for homes in the surrounding neighborhood over a reasonable time period (often 3-6 months). Appraisals are usually ordered by a bank, prior to the approval of a loan to a prospective buyer. Ideally, an appraisal is based on market activity for similar homes within a half-mile over the last three months. If there weren't enough transactions within that area or time period to gather sufficient data, the parameters are extended (i.e. similar properties sold within 1 mile over the last 6 months, or so on).

The estimate given in the CMA may be similar to the value reported in the appraisal, but that isn't always the case. Both reports are researched and compiled in similar ways. The one significant difference is that a CMA is considered an informal estimate, while the appraisal value is ultimately documented as the current value of the property. For loan purposes, banks accept the appraisal as the definitive word on the value of your home.

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