What Is a Comparative Market Analysis (CMA) In Real Estate?

When you’re buying or selling a home, one of the first questions is: What’s the property really worth? That’s where a Comparative Market Analysis (CMA) comes in.

A CMA is a comprehensive report that blends data and expertise to estimate a home’s true market value. It examines recently sold, active, and pending properties in the same area, but goes beyond raw numbers by considering location, condition, and market momentum

A CMA is the most powerful tool in real estate pricing. It is often the first step of a successful home sale, and a good tool to have as a homeowner even when you aren't selling in the near future.

How a CMA Works

Real estate agents prepare CMAs by looking at “comps” (comparable properties). These are homes similar in size, condition, location, and features. By comparing your property to others, agents estimate a fair market value that reflects current trends.

Key Elements in a CMA

1. Recently Sold Homes: Show what buyers have actually paid for similar properties. These are the most reliable indicators of value.

2. Active Listings: Represent the current competition on the market. While they don’t confirm value, they show what sellers are asking and where your home will need to stand out.

3. Pending Sales: Homes under contract reveal what’s likely to close soon, giving insight into near-future values.

4. Expired or Withdrawn Listings: Demonstrate where sellers may have overpriced their homes, causing them not to sell.

Why a CMA Matters In Real Estate

For sellers, a CMA helps set a competitive asking price that attracts buyers without leaving money on the table. For buyers, it helps determine whether a property is fairly priced and strengthens negotiations.

Think of a CMA like checking prices before buying a used car. You wouldn’t pay blindly—you’d look at similar cars, mileage, and condition to make sure you’re getting a fair deal. A CMA does the same for homes, just with more detail.

What Makes a Good CMA? (and What Isn’t a CMA)

A strong CMA doesn’t just copy MLS data. It carefully selects homes that truly match the subject property in size, location, and condition. A good realtor will adjust for differences like renovations, lot size, or number of bedrooms so the value is realistic, not inflated. Quick printouts or automated value estimates online are not true CMAs. They lack context, professional judgment, and set sellers up for diapointment or failure. A reliable CMA is rooted in real sales data, adjusted with expertise, and tailored to the specific home.

In Review, What Is A CMA?

A Comparative Market Analysis is a practical tool that ensures buyers and sellers are making decisions based on facts, not guesses. It’s the backbone of pricing strategy in real estate.

Looking to buy or sell in Milwaukee? I’d be happy to prepare a CMA tailored to your home or neighborhood. Reach out today to get started.