Comparative Market Analysis (CMA)

What is Comparative Market Analysis (CMA)?

A Comparative Market Analysis (CMA) is a report prepared by a real estate professional that estimates a property’s market value based on recent sales of similar homes in the area.

Why Comparative Market Analysis (CMA) Matters in Real Estate

In Canadian real estate, a CMA helps sellers price their homes competitively and assists buyers in making informed offers. It’s based on ‘comps’—comparable properties that have recently sold or are currently listed.

A typical CMA evaluates:
- Recently sold homes (typically within 3–6 months)
- Active listings (current asking prices)
- Expired listings (homes that didn’t sell)
- Property features (size, age, condition, location)

CMAs are not formal appraisals, but they provide a data-driven pricing strategy. REALTORS® use their expertise and local market knowledge to interpret the data and make pricing recommendations.

For sellers, a CMA can help avoid overpricing or underpricing. For buyers, it can reveal whether a home is fairly valued. CMAs are especially important in competitive or fast-moving markets where price accuracy can impact sale outcomes.

Example of Comparative Market Analysis (CMA) in Action

A REALTOR® prepares a CMA for a seller showing that three similar homes in the area sold for $850,000–$875,000. They recommend listing the property at $860,000.

Key Takeaways

• Estimates property value based on local sales data.
• Used by sellers to set prices and by buyers to evaluate offers.
• Compares recent and similar property sales.
• Created by a licensed REALTOR®.
• Not a formal appraisal, but a strategic pricing tool.

Related Terms

• Market Value
• Appraisal
• Listing Price
• Fair Market Value
• Pricing Strategy