Or what is my pyramid worth on today s

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

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

How Defined • 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

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

How to Create the CMA • First step --– Get recorded historical info including tax rec. ; plat map • can use the MLS & office maps or Win 2 Data 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.

How to Create the CMAthe 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.

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

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?

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