I do not appreciate being called a fly by night agent. I worked very hard to get my license. I have read several books in addition to attending classes at my previous brokerage. How can you fault me for wanting to be a better realtor? I want to make sure I can do cma's in my sleep. So Step Off!

AgentBauer....I wasnt addressing you directly. Please dont take offense. My comments were directed towards the creator of this particular forum.

I should have been more specific when I wrote the reply. I read the first comment and liked to have fallen out of my seat!

In this instance, the fault should NOT be placed on agents. The fault should actually be placed on local boards and brokers who are not required to certify their agents on basic agent tasks such as CMAs, advertising, ethics, etc. This is clearly a topic that should have been well-covered by a broker. Better agent training should be enforced by Real Estate Boards and Association on a local and state level to protect the integrity of this profession. In the end, its the communities that we serve that hurt from well trained agents....

Stepping.....

REbySB

Sorry....poorly trained agents...not well-trained agents....

I don't think anyone really teaches anyone to do a real proper CMA. My broker and boards never had a CMA specific classes either....

I agree with cwtripps and agentblauer, I don't feel that I entered this profession with enough knowledge of how to do a CMA properly. I learned a lot from self-study of appraisal techniques, but the one thing that differentiates an appraisal from a CMA is knowledge of what buyers want and will pay for in your specific market area. Sometimes a house one one street will be worth $40,000 more than an identical house on the next street because that street is more desirable.

As an example, there is a house in my neighborhood that when you calculate market value from an appraisal perspective it should appraise in the 800's due to quality of construction, SF, etc., but the home was custom built for the specific needs of one family and has little appeal to buyers. It sat on the market for six months two years ago without selling and now the owners are trying again. I've spoken to other agents who did CMAs on the home and we have different perspectives on what the market value of the home should be. I didn't put as high a value on the superior quality of construction as another agent did, because it's been my experience that most buyers won't pay extra for that. I used comps on the same street, other agents used comps from other streets. We also varied in what we adjusted and how much we adjusted.

My CMAs definitely have gotten better and better at determining the market value of homes in my area as I grow in experience. I learn from buyers what they value and will pay for. I also get to know the condition of comparable properties from having seen the interior and perhaps even from being at an inspection of the home, if I was representing a buyer.

And, yes, I was aghast at how the agent who started this thread goes about doing a CMA, and there's no excuse for that, but the larger issue is that there isn't enough discussion or training about how to do a proper one in our profession, in my opinion, and appraisal classes are not a satisfactory substitute.

In MN that is the law. We are not allowed to tell a buyer that a sex offender in the area. We can give them a number to call or web site to check out, but we find that these are not updated very well and a lot of times if they say that there is one in this area, there really is not. I suggest to my clients that they talk to the neighbors in the area that they are looking at and see what all they find out this way.

Amanda

DO WHAT I DO AGENT BAUER JUST KEEP READING UNTIL YOU GET A USEFUL ASNWER TO YOUR QUESTION AND IGNORE ALL THESE IDIOTS MAKING THE STUPID REMARKS.

Our Board or Realtors held CMA classes as well as othe classes on how to use our MLS system. They were some of the first courses I took, I did not want to waste time trying to figure it out.

In doing a CMA, I think the most important thing is in-depth knowledge of the properties in an area. It is very difficult to do a CMA if you have not been inside the properties being used as comparables. For example, I have a property at $550,000 listed that is identical to one sold for $100,000 less a few months ago. You cannot tell from the listing description of the other property that it needed $100,000 worth of work. It sounds like move-in condition, but that is not the case and agents who know the area realize this.

I looked at 2 appraisals yesterday for the same property, one was commissioned by my company, the other by the owner. Ours came in at $365k, the other one at $330k. Even appraisers don't always look at things the same way.

Folks, I think the point is that there is not enough broker training and maybe Board Specific training for Continuing Ed on actually doing a CMA and how to judge value, neighborhoods, amentities, etc. I also had a general MLS class where they show you how to create a CMA. big f'ng deal that it taught me how to click things and select properties. A 5 year old could have figureed it out.
None of this teaches an objective methodolgy and the subjective realities of doing an EXCELLENT CMA. When my broker trainer did one for me when I 1st started, her general CMA put the house at a value 100k above what it actually sold for in the end. My gut was that she did a bad CMA from the moment I saw it and I was right.

I guess the only way to learn more besides knowing the homes and neighborhoods is to take an appraisal class and learn the way appraisers execute the comparison method..the realtor preferred method. From what I have learned, location/neighborhood, Size, Condition, and amenities ARE the 4 main criteria in judging value. As some previously mentioned...the condition and amenities are very hard to value sometimes because a large amount of buyers might not care of the difference b/w one builder and another's construction quality, or if you put 30k in your kitchen, or they are going to repaint and recarpet anyway, etc. Cost doesn't equal value as I have been taught so hence the dilemna.The main things we can judge on are location and Square feet and how average and median prices play into a comp price.

If anyone has a concrete methodology on doing CMAs I am sure everyone interested would like to hear it.

Appraisers can provide as independent and unbias an opinion as is available in the market place, but we all know that there is a tremendous amount of emotion involved in the buying process. Often the real market value (selling price) is determined by the perception of the buyer. Know your neighborhood and know your buyers and you will know how to do a CMA.

To be honest, I am a new agent as well, but know how to do CMA's. I didn't learn much else in my appraisal class for the pre-licensing, but I know how to do that! lol!

-Shawn

Shawn, There is a world of difference between doing a CMA and doing an excellent one. We are not talking about basics, but standards of excellence.

After two years of specializing in one small market area, I have almost laser-like precision on what matters and what doesn't to the majority of buyers. I can't take into account the one off buyer who has taste different from the majority, but I can say with fair degree of precision what buyers want, will pay more for, what they don't want, what they don't care about, and the value of a particular street vs. another street.

You certainly can do a CMA in an area you don't know, but it will not be as precise, and may even be laughable to agents who know that area well. CMA's are all about understanding what buyers want and real knowledge about the properties you use as comparables.

I think that does take time, my partner and I are always right on the money at assesing what the right price range is, but if the seller agrees is another thing. One thing I have found lately is they start the price discussion with " I need...." And we all know their financial needs does not set, the price the buyers do.