A practical guide for real estate agents

How to Do a CMA in Real Estate

Learn how to review a subject property, choose meaningful comparable sales, evaluate adjustments, and turn market evidence into a defensible pricing conversation.

Build Your CMA → Read the Steps
Comparative market analysis

A good CMA is more than an average price per square foot.

A comparative market analysis, commonly called a CMA, is an agent's structured analysis of how a property fits within its current market. It starts with relevant sold properties, then considers the meaningful differences between those sales and the subject property.

Active and pending listings add context. They help an agent see how the proposed price competes with today's choices, but they do not replace closed sales as the foundation of the value conclusion.

The goal is not to manufacture the highest possible number. The goal is to produce a price range that can be explained, defended, and used to make a responsible listing decision.

Step-by-step

How to prepare a real estate CMA

There is no single comp that tells the entire story. A credible CMA combines reliable data with professional judgment, then makes the reasoning clear enough for a seller to understand.

1

Review the subject property

Begin with the facts of the property you are pricing. Verify the address, property type, living area, bedroom and bathroom count, year built, lot characteristics, parking, major systems, and relevant amenities.

Then look beyond the basic fields. Condition, renovation quality, functionality, ceiling height, flooring, kitchen and bathroom quality, pool improvements, waterfront status, acreage usability, and other lifestyle features can materially change the buyer pool.

Agent checkpoint If you have not personally seen the property, treat condition and upgrade information as provisional. Photos and public records rarely tell the entire story.
2

Define the likely buyer market

Two homes can be geographically close and still compete for different buyers. A condominium should not normally be treated like a detached house. A small subdivision home may not be comparable to a larger home with a different level of construction quality, even when both share the same neighborhood name.

Ask which listings a real buyer would realistically compare with the subject. Consider property type, size category, quality, age, community, land use, lifestyle, and location before focusing on price.

3

Select at least three relevant sold comps

Closed sales are the evidence that buyers and sellers actually reached an agreement. Start with the most comparable recent sold properties and expand the search only when the market does not provide enough relevant results.

Prioritize similarity before convenience

  • Use the same residential property type whenever possible.
  • Look for similar living area, quality, condition, amenities, and lifestyle.
  • Prefer recent sales, but do not automatically discard an older sale that is substantially more comparable.
  • Review distance in context; rural and highly specialized properties may require a broader search.
  • Confirm that concessions or unusual circumstances did not distort the recorded sale price.

A newer sale is useful market evidence, but recency cannot repair a fundamentally poor match. An older but highly similar property can sometimes tell you more than yesterday's sale of a materially different home.

4

Add active and pending competition

Active listings show the seller's current competition. Pending listings indicate which asking prices have attracted a buyer, although the final contract price is generally unknown until closing.

Use these properties to test the positioning of the CMA conclusion—not to create the value conclusion itself. A long-standing active listing may be evidence of a price the market has rejected, while a strong pending match can provide useful support for current demand.

Important distinction Sold properties support value. Active and pending properties help test whether the proposed list price competes in the current market.
5

Review meaningful property differences

Adjustments are intended to make each sold comp more comparable to the subject. The direction matters: if the comparable is inferior, its sale price may require a positive adjustment; if it is superior, it may require a negative adjustment.

Common areas for review include living area, bathroom count, garage capacity, pools and screen enclosures, waterfront, flooring, kitchen and bathroom quality, renovation condition, usable acreage, and other material features.

Avoid double-counting. For example, additional bedrooms may already be reflected in a substantial living-area difference. Likewise, a flex room included within the reported square footage does not automatically deserve a separate adjustment.

There is no universal adjustment schedule that works for every property and price range. The contribution of a feature depends on the market, the quality of the improvement, the buyer pool, and the overall value category.

6

Reconcile the adjusted sold values

Once the relevant differences have been reviewed, compare the adjusted indications produced by the sold properties. Do not assume every comp deserves equal influence.

A close match in size, quality, condition, and buyer appeal may deserve more consideration than a property requiring numerous large adjustments. Outliers should be investigated, explained, corrected, or removed when they are not reliable evidence.

The conclusion should be a reasoned range—not simply the highest sale, the lowest sale, or an unexamined average.

7

Test the proposed price against the market

Compare the proposed list price with the current active and pending competition. Consider price, size, quality, condition, and days on market together.

If the proposed price matches or exceeds a similar active listing that has been available for months, revisit the assumptions. The seller may be preparing to compete with a property the market has already declined to purchase.

This final market-position review helps turn a value estimate into a listing strategy.

8

Present the evidence, not just the number

A strong CMA presentation helps the seller understand why the recommended range exists. Show the sold evidence, explain the most meaningful adjustments, identify the property's likely competition, and discuss how different list prices may affect market response.

Be clear about uncertainty. A CMA is not an appraisal or a guarantee of sale price. Property condition, buyer demand, financing, concessions, insurance, and changing market conditions can all affect the final result.

DW&Co. CMA Builder

Turn your comp set into a clearer pricing conversation.

The CMA Builder organizes sold-property analysis, allows agent-reviewed adjustments, and compares your proposed price with active and pending market competition.

Build Your CMA →
Frequently asked questions

CMA questions from real estate agents

What does CMA mean in real estate?

CMA means comparative market analysis. It is a real estate professional's analysis of relevant sold properties and current market competition used to help estimate a property's likely value range and develop a listing strategy.

How many comps should a CMA include?

A useful CMA should generally include at least three credible sold properties. Additional solds can help when they are genuinely comparable, while active and pending listings can be included to evaluate current market positioning.

How recent should CMA comps be?

Recent sales are normally preferred because they better reflect current conditions. However, age should not be considered in isolation. In rural, luxury, or highly specialized markets, an older but substantially more comparable sale may be meaningful when its limitations are clearly disclosed.

Should active listings determine the CMA value?

No. An active price is an unproven seller expectation. Active listings are useful for understanding competition and testing the proposed list price, but closed sales provide the principal evidence for the estimated value.

Is a CMA the same as an appraisal?

No. A CMA is a real estate pricing analysis and is not an appraisal. It does not guarantee market value, appraised value, or a final sale price.

Can software prepare a CMA automatically?

Software can organize data, suggest adjustments, and calculate results, but an agent should still verify the subject property, review every comparable, correct extracted information, and approve the final analysis. Technology should support professional judgment rather than replace it.

Important notice: This educational content and the DW&Co. CMA Builder do not constitute an appraisal and do not guarantee market value or sale price. Extracted data, comparable selection, suggested adjustments, and pricing conclusions should be independently reviewed. An in-person property visit and individualized analysis may be necessary.
Scroll to Top