Or, what is my pyramid worth on today ’ s market?

1. CMA's Or, what is my pyramid worth on today’s market?

2. The Comparative Market Analysis How defined How important How to make money using one How to create one

3. HowDefined • What it is ---- • An indication of current market value based on an analysis of recent sold’s and current market activity of like properties • It’s a combination of art and science . . . Why? • Science because we usually have lots of good data • Art because real estate is, by definition unique and a ‘subjective’ or emotional decision for the buyer • In our ‘upscale’ market we have some challenges that can require going beyond available comps / require ‘judgement’ • What it is not --- • Not an ‘appraisal’ per se e.g. Can’t take it to the bank

4. How Important • Probably the single most important tool and service we have to offer . . . Why? • Home equity is typically the single biggest asset • What are the downsides of inaccuracy? • Overpriced becomes ‘market worn’ and sells for less • Under-priced leaves money on the table • Overcoming the temptation to tell people what they want to hear • The pro’s get seller ‘buy-in’ to price to sell -- HOW? • The pro’s build their careers on success and success buys you not only opportunity but respect for your opinions • If you’re new-- you must make a compelling case

5. How to Create the CMA • First step --- • Get recorded historical info including tax rec.; plat map • can use the MLS & office maps or Win2Data for both • Get as much historical information as possible • model • upgrades-- pool; landscaping; granite; etc. • views or lot premium / lot orientation e.g. N/S exposure • what were the factors that caused the ‘buying decision’ • Review-- noting subdivision; square footage; year built; how long owned; what they paid; bdrms; baths; pool; etc.

6. How to Create the CMA-the search for hidden truth . . . • Next --- • MLS search for comparables • Stay within subdivision, if possible • Go back 1 year, with special attention to the most recent • Pull current listed and pending comps • Look for a ‘rationale’ that justifies the differences e.g. view; premium lot; model; upgrades; condition; orientation; etc. • keyword search • use plat map to identify orientations; lot size • Reading not only features, but remarks can help (maybe) • Use a variety of searches e.g. wildcard; with / without pool; etc.

7. How to Create the CMA-A ‘weighty’ responsibility • Then --- • Determine absorption rate • AR = # sold (past 12 months) / 12 (correction) • Current listed / AR = # of month supply • Drive by solds • If necessary, talk to the listing agent • Preview availables • Again, look for the relative pluses and minuses that could affect buyer demand • Note variables (3-car v.s. 2 -car garage; etc) • The CMA report is a fast way to get $ per sq. ft. • Be aware of the cost difference of multi-story vs. single story • upgrades need to be identified and accounted for

8. How to Create the CMA-A ‘weighty’ responsibility • Analysis • Job is to get the most money in shortest period of time • By “synthesizing” (merging) all the info, you can almost always get a fairly narrow range (3 to 5%) • Note: Properties that sell, tend to sell within 3-4% of listed price • Learn to make “weigh” what improvements are worth on a ‘resale’ basis e.g. will an 80 K lot premium net 80 K • What does it mean to be over-improved? • Principle of progression & regression . . . • If the target market is reduced what happens to the marketing time?

9. How to make Money w/ CMA v.s the career listing • Getting the opportunity • the dog and pony show --- preferably in color • present the CMA in the context of a ‘marketing plan’ • using Toolkit CMA / Marketing Plan (template) • Positioning • The key to your ‘marketing success’ is in positioning the subject property to be “the next one sold” in that market • “Wholesale v.s. retail” (when dealing with FSBO’s) • The myth that “we can always come down” • Agent feedback visa vi office tours & feedback from previews and showings • Some suggest monthly CMA updates