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Purpose: To compare the subject property with similar properties that are currently on the market, recently sold, or rented, often used for pricing residential properties.
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Scope: The appraiser evaluates similar properties in terms of size, location, condition, and amenities, then adjusts for differences to estimate the market value of the subject property. CMAs are commonly used for residential appraisals and to assist homeowners or real estate agents in setting a listing price.
Competitive Market Analysis (CMA)
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Purpose: To analyze the characteristics of the surrounding neighborhood that impact property values, such as economic stability, social trends, and physical conditions.
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Scope: The appraiser examines factors like demographic trends, crime rates, access to amenities (schools, parks, shops), public services, and overall neighborhood appeal. This analysis helps in understanding whether the neighborhood is in decline, stable, or undergoing growth and revitalization.
Neighborhood Analysis
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Purpose: To evaluate historical and current trends in the real estate market to predict future property value movements.
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Scope: The appraiser studies trends in property sales, rental rates, construction costs, interest rates, and overall market conditions. The study may also focus on broader economic indicators like inflation, unemployment, and consumer confidence that influence the real estate market. This analysis helps stakeholders make informed decisions about investing or selling in the market.