A CMA is the main tool agents use to set a list price or shape an offer. It compares a home with nearby comparables that sold recently, then adjusts for the differences to arrive at a
What’s in a comparative market analysis?
A CMA usually looks at three groups of homes. Sold homes show what buyers actually paid, and they carry the most weight. Pending sales show where prices are heading, since they went under contract recently but haven’t closed. Active listings show the competition buyers will compare
For each comp, the report lists the price, size, price per square foot, bedrooms and bathrooms, lot, age, condition and days on market. Agents usually pull this from the multiple listing service, which has more detail than public sites, including sale prices in states where they
How are comparables chosen and adjusted?
Good comps are nearby, similar in size, age and style, and recent. Appraisers working on loans sold to Fannie Mae, for example, must report at least three closed sales and should generally use sales from the last 12 months. Agents often follow a similar approach and lean on the most recent sales when there are
No two homes match, so each comp is adjusted toward the home being priced: add value to a comp that lacks the home’s extra bedroom or garage, subtract value from a comp with a pool the home doesn’t have. The adjusted prices then point to a range rather
How is a CMA different from an appraisal?
A CMA is an agent’s opinion, usually prepared free to help price a home or write an offer. An appraisal is a formal valuation by a licensed or certified appraiser, usually ordered by the buyer’s lender to confirm the home supports the loan. Appraisers follow strict rules on comps and adjustments; an agent has more room to weigh buyer demand
An automated valuation model, the kind of estimate you see on home search sites, is different again. It’s computed from data without anyone seeing the home, so it can miss condition, updates and the details of
How do you use a CMA when selling?
Use the CMA to set a list price inside the range the comps support, then keep it current. Ask your agent to update it as new sales close nearby. If showings are thin after the first few weeks, the newer comps help decide whether a price reduction makes sense.
Example: pricing a 2,000-square-foot home from three sales
| Comp A: 1,850 sq ft, sold for $370,000 | $200 per sq ft |
|---|---|
| Comp B: 2,100 sq ft, sold for $430,500 | $205 per sq ft |
| Comp C: 2,000 sq ft, sold for $390,000 | $195 per sq ft |
| Average price per square foot | $200 |
| Starting point for 2,000 sq ft | $400,000 |
| Range after adjustments for condition and features | $395,000 to $410,000 |
Hypothetical numbers. Price per square foot is only a starting point; adjustments for condition, lot, layout and features move
Common mistakes
- Pricing from active listings alone. Asking prices show the competition, not
what buyers paid. - Using comps from a different neighborhood or school zone because the
square footage matches. - Treating an online home value estimate as a CMA. It hasn’t seen the home’s
condition or upgrades. - Expecting the appraisal to match the CMA exactly. Appraisers choose their own
comps and adjustments.
Questions
How much does a CMA cost?
Agents usually provide one free when they’re competing to list a home or helping a buyer write an offer. An appraisal, by contrast, is a paid service, usually ordered
How many comparables should a CMA use?
There’s no fixed number; a handful of close matches beats a long list of loose ones. Appraisals for loans sold to Fannie Mae must include at least
How often should a CMA be updated?
Whenever new sales close nearby, and regularly while a home is on the market. In a fast-moving market, a CMA can go
Sources
- Fannie Mae Selling Guide B4-1.3-08: Comparable sales
- CFPB: Quality control standards for automated valuation models
Written and checked by the Broker & Agent team on October 2, 2026. General information, not legal, tax or lending advice. Something out of date? Tell us.