Real Estate Terms Canada - Jargon Explained Jargon in the real estate industry in Canada…
What is a comparative market analysis?
A comparative market analysis (sometimes referred to as a market evaluation) is the process Realtors use to calculate the market value of properties with to help an owner sell or a buyer to understand the actual value of a a property they are interested in buying.
How I do a comparative market analysis
1 ) Visit the property in question
The first thing I do when requested to do a Comparative Market Analysis is to physically visit the property. Visiting the property is key! In my view, it is impossible to get an accurate idea of the market value on a property in the Vancouver real estate market without seeing the property.
2) Only analyze what I know. Local expertise is key!
I can only do an accurate market analysis on properties I know and am familiar with that are within my geographic area of specialty. If I am asked to do a market analysis on a property that is outside of my geographic expertise, I will ask to refer the client to an area expert.
3) Gather and review data both on and off MLS
Once I have seen the property, I review the data which in most cases are the comparable (Similar square footage, age, type of construction materials, number of bedrooms, number of bathrooms, lot size, etc) properties in the area that have sold in the last 30-180+ days as well as nearby properties that are actively listed on the market. I also use MLS data as well as information on private non-MLS sales.
3) Calculate market value based on relevant and current Information.
In a stable market the sold price of properties will have more relevance and in a more volatile market, asking prices will be more relevant. How long these comparable properties have been on the market as well as overall market conditions and trends will also colour my analysis. Cancelled, and expired listings will also have an impact based on based on the fact they did not sell and the reasons for that result.
4) Present a clear and understandable report with all relevant data that gives a clear idea of the property’s value.
Once I have completed the comparative market analysis, I typically email the report that will have all of the data that I used to come to my conclusion in .pdf format. I then call the client to discuss and explain the analysis and the conclusion. The Comparative Market Analysis should make sense to a potential seller or buyer and the analysis should be able to make a convincing case on the market value of the property.
WOULD YOU LIKE TO KNOW THE VALUE OF YOUR HOME in Vancouver?
Call 604-763-3136 or Email ME for a Free Market Evaluation!