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I got a CMA done on my house last week and the realtor emailed me today about it. To be frank, I was insulted. That out of the way, I wonder what goes into a CMA besides just the specs of the house. Basically, all he did was take the average of the price/sq foot in "northern Durham county" and multiplied it by my home's square footage to get his number. Lot size didn't factor in (we've got quite a large lot for the area), aesthetic appeal our yard - we have a creek with a wooden bridge and lots of trees in the yard, kitchen appliances and washer and dryer are all less than 5 years old.
My question is: am I being too emotional about this CMA and is square footage that all that *should* be considered in coming up with a price? How "large" of an area surrounding my house should be used for getting comps? If you know anything about Durham, you know that if you go out 1/2 mile you'll get really expensive homes and really cheap homes.
Should I go to another agent for a second opinion? (Honestly, I think the guy was either trying not to have to list it since it's not a "high dollar" home or trying to get it listed for cheap to make a quick sale.) Thanks.
You really should speak to several different agents if you don't have one already... You don't have to set your asking price on the CMA and maybe, this agent is being very realistic...
Remember, an agent that gives you an inflated CMA is often only trying to get the listing and when will be back asking for a reduction when it doesn't sell...
In this market, most sellers disagree with the CMA.
Having said that, I would suggest talking with 2 other Realtors, and getting a CMA from each of them. The CMAs should be close in the estimate of list price. If not, hire an appraiser for a fee, who will provide you with an independent Opinion of Value, based on closed sales in your market area, within the past 3-6 months. Then, list your home with the Realtor of your choice, based on that appraisal. You may find that Realtor #1 was right on target.
The price could be right, but I do believe the agent owes you a good reason behind it. Average price per sqft is a decient starting point, but is not enough.
Sure the offering price may be set by you, but I think and good agent will work closly with the client to determine the value and what it limitaions may be. If a propery is unique or different that must be factored in. Even of the number is spot on in a down shifting market agents must explain this to their client as you can't expect the a client to understand all the prices trends in the area. It is part of the job of the agent to inform the client of these factors.
So the number may be entirely accrurate, but it sounds like at a minimum there has been a pis. poor job of communucating it. I would ditch that agent as if they don't give you the info you need now you may always find yourself lacking information to be confident in your situation.
A good CMA takes into account the differences and similarities in the property - square footage, age, amenities, lot size, area, etc. Now, first, remember, everyone thinks that their house is MUCH better than every other house on the block - that's why they bought the house they did and/or put the improvements they like into it.
Did he send you the comps that he used to come up with the CMA? That can help you look at exactly what's being compared and if apples are being compared to apples.
For example, one comp might have a smaller lot than your house, but have something else that's a positive that yours doesn't have, and it might be something that buyers see as more of a positive than they do a larger lot size. That's information that an agent has that they can use with more objectivity than a seller might have access to or be able to be objective about.
The area should be as close as possible, but sometimes it's impossible to get a suitable number of comps within a few streets (there may not have been enough activity in that area to provide sufficient comps - usually 3 actives, 3 solds, 3 expireds and/or 3 withdrawns). Then, you move further out, trying to use neighborhoods that are as similar as possible to the neighborhood the subject house is in, but as close as possible as well.
So it's not just square footage, but what else it is might not be as obvious from a simple CMA emailed to you.
That being said, some agents will just use square footage to do their CMAs, and I have no way of knowing whether the agent in question is one of those or not. So, since you disagree with the CMA, you likely should talk to at least two more agents to get their opinions (but don't agent shop until you get one to tell you what you want to hear - Ultrarunner is absolutely correct that some agents will try to "buy" the listing with an inflated CMA, having every intention of coming back and getting you to lower the price later when it doesn't sell - and that doesn't serve you or your interests at all).
Yeah, I know that everyone thinks that their house is unique and better than all the rest in the neighborhood, but in my case, it's true! (Just kidding...) I'll ask for the comps and get a second and third opinion. I've got a what I believe to be a realistic view of the value of the house but I just don't think that this dude did a good job on it.
If you have an idea of what you personally think your home is worth, I'd be interested to know how you came to that value. What research did you use?
I looked at sale prices for the homes in my neighborhood (ones that have sold in the past year) and tax values for the homes that aren't for sale (I know tax values are inflated, but not 20,000 inflated!). It's not the most thorough research in the world, but it's not completely pulled out of thin air, either.
Yeah, I know that everyone thinks that their house is unique and better than all the rest in the neighborhood, but in my case, it's true! (Just kidding...) I'll ask for the comps and get a second and third opinion. I've got a what I believe to be a realistic view of the value of the house but I just don't think that this dude did a good job on it.
From an appraiser's point of view, and from what you've offered, it sounds like you have an 'over improvement' for the neighborhood, which is never a good thing. The rest of the homes in your neighborhood may be pulling you down. Real estate agents know the market, and present an objective point of view. I still maintain it would be a good idea to talk to, at least, one other agent and get another CMA. And then, as I said, if you still think they don't know what they're talking about, pay for an appraisal.
Well the CMA could be spot on, but if agent can't satisfactorily explain that to you how can you expect them to explain other important issue to you in the future.
I don't expect and agent to have all the answers, but part of their job to answer questions and bring their experience in selling homes to the table to so that the client and feel informed about the major decisions they are making. Agents must also understand that every's need for information is different and may need more/less detail or greater indept explainations. A good agent can't change the market, but should be able to give you what you need to feel like you are making sold informed decisions.
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