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| If the price of your Sandpiper Lakeland FL home for sale is based on your agent's CMA, chances are good that it will match the buyer's appraisal. |
What’s the difference between an Appraisal and a CMA when it comes to selling your Sandpiper Lakeland Fl home?
You can determine the value of your Sandpiper Lakeland Fl home for sale in two ways - through a professional appraisal or a comparable market analysis (CMA). What is the difference? A professional appraisal is a formal process to determine the value of your home, a licensed appraiser conducts the appraisal. On the other hand, a CMA is a professional report prepared by a listing agent, it shows you the recent sales of comparable homes in your market.
The professional appraisal uses three approaches to determine the value of your Sandpiper Lakeland Fl home home. The Cost Approach is derived from a calculation of the cost to replace the home, less depreciation and other factors, plus the land value. The Income Approach is pertinent to investors which involves estimating what an investor would pay based on the income produced by the property. The most common and accurate approach is the Sales Comparison Approach. This involves providing a comparison to other similar homes located nearby that have recently sold.
In a Sales Approach, the professional appraiser will visit the home he or she is contracted to appraise and will compare it to other homes currently for sale, homes under contract and homes sold in recent months in the area with similar square footage, condition, age, amenities, number of bedrooms, and more. The data gathered by the appraiser will be compared to property tax records, along with recent market trends to determine if prices have gone up or down. Information from the MLS is also used by appraisers.
If an appraisal comes in lower than the asking price of the subject Sandpiper Lakeland Fl home, the bank may not grant the buyer the loan depending on the terms and condition of the sales contract between the seller and the buyer. Therefore, the seller will most likely need to reduce the price so the buyer can purchase the property.
A Sandpiper Lakeland Fl real estate agent not licensed as an appraiser can’t perform appraisals. Appraisals are generally requested by the bank to protect its interests and to make sure they don’t loan too much money for a home currently under contract to be sold.
A CMA is done by a professional real estate agent and is used to determine a home’s current market value. The seller can then determine the best listing price for their home where it will sell for the highest amount possible in the shortest amount of time. Hiring a real estate agent to do a CMA is equally important to hiring an appraiser. You want to hire an agent that is experienced providing you such an analysis. He or she must be knowledgeable and have a true understanding of the real estate market, trends and valuation concepts and is familiar with your community.
Your real estate agent will get information from the MLS (multiple listing service) on similar listed homes for sale, sold data, property tax roll data, historical trends and use this data to generate a CMA. The CMA includes homes for sale in your immediate area as well as recently sold properties that are similar to your home in square footing, number of bedrooms, appearance, features, and price range. Such analysis may also include comparable homes that are no longer on the market and homes currently under contract.
Establishing the fair market value of your home is very important to buyers and their lenders. Once your buyer applies for a loan, the lender will order an appraisal on your home for sale. If the price of your home is way above comparables, your home may not sell and may stay on the market for a long time.
If the price of your Sandpiper Lakeland Fl home for sale is based on your agent’s CMA, chances are good that it will match the buyer’s appraisal. This means your buyer will most likely be approved for the loan and you can quickly sell your home.
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