The short answer
A comparative market analysis (CMA) estimates a home's value from recent comparable sales. Here is the exact 6-step process to run one - define the subject, pull comps, screen them, adjust, reconcile to a range, set a strategy - with a worked example you can copy and a neutral look at the tools agents use. For the underlying concept, start with what a CMA is.
What you need before you start
Two things: the subject home's details, and access to sold-home data.
- Subject details: beds, baths, living area, lot size, garage, age, and honest notes on condition and upgrades.
- Sold data: MLS is the gold standard. Public county records work as a backup or a cross-check.
If you are a homeowner without MLS access, ask a local agent for a CMA - most provide one free. If you are an agent, run the search in the MLS first and pull public records to fill any gaps.
How to do a comparative market analysis in 6 steps
The whole process, at a glance:
- Define the subject property.
- Pull comparable sales.
- Screen the comps.
- Adjust for differences.
- Reconcile to a price range.
- Set the pricing strategy.
- 1
Define the subject property
Know what you are pricing before you look at anything else.
- ·Gather beds, baths, living area, lot size, garage, and age.
- ·Note condition and updates - kitchen, baths, roof, systems.
- ·Write it down. This is the row every comp gets compared to.
- 2
Pull comparable sales
Find at least three recent, nearby, similar sold homes.
- ·Sold in the last 3-6 months, in the same submarket or school zone.
- ·Similar size (within ~10-20%), similar style, similar age.
- ·Prefer MLS sold data. Public records work as a backup.
- 3
Screen the comps
Throw out anything that is not really comparable.
- ·Drop stale sales, distant neighborhoods, or radically different homes.
- ·Watch for concessions or off-market deals that skew the price.
- ·Aim to keep the three to six best matches.
- 4
Adjust for differences
Bring each comp to what it would have sold for if it were the subject.
- ·Add value where the comp is inferior; subtract where it is superior.
- ·Adjust for living area, baths, garage, lot, and condition.
- ·Keep adjustments conservative. Big adjustments mean weak comps.
- 5
Reconcile to a range
Turn the adjusted prices into one defensible range.
- ·Weight the closest and most recent comps most heavily.
- ·The tight cluster of adjusted prices is your range.
- ·Anchor the middle of the range as the likely value.
- 6
Set the pricing strategy
Pick a list price that matches the seller's goal.
- ·Bottom of range invites offers and can spark a bidding war.
- ·Top of range plays for maximum price and a longer wait.
- ·Middle is the safe default in a normal market.
Step 1 - Define the subject property
Write down the facts. Beds, baths, living area, lot size, garage, age, style. Then add the condition notes: kitchen and bath updates, roof and system age, finished basement, deferred maintenance. This is the row every comp will be measured against. Skip this step and every adjustment later will be a guess.
Step 2 - Pull comparable sales
Aim for at least three recent, nearby, similar sold homes. Recent means the last three to six months in a normal market, tighter in a moving one. Nearby means the same submarket or school zone. Similar means within about 10-20% on square footage, similar style, similar age, similar lot. Pull six to ten candidates - you will trim them next.
Step 3 - Screen the comps
Throw out anything that is not really comparable. Common cuts:
- Stale sales that predate the current market.
- Distant sales in a different neighborhood or school zone.
- Homes with radically different size, style, or condition.
- Off-market deals, family transfers, or sales with heavy concessions.
Keep the three to six best matches. If you cannot find three that pass this bar, widen the time window before you widen the geography.
Step 4 - Adjust for differences
For every feature that differs from the subject, add value where the comp is inferior and subtract value where it is superior. The direction is intuitive; the magnitude comes from local sold data on similar pairs.
| Feature | Subject | Comp 1 | Comp 2 | Comp 3 |
|---|---|---|---|---|
| Sold price | - | $335,000 | $362,000 | $345,000 |
| Living area | 1800 sq ft | 1800 sq ft | 2050 sq ft | 1800 sq ft |
| Beds | 3 | 3 | 3 | 3 |
| Baths | 2 | 1 | 2 | 2 |
| Garage | 2-car | 2-car | 2-car | 2-car |
| Lot | 0.20 ac | 0.15 ac | 0.22 ac | 0.20 ac |
| Condition | Updated | Updated | Updated | Dated |
| Adjustments (+/-) | ||||
| Line 1 | - | Bath (1 vs 2): +$8,000 | Living area (+250 sq ft): -$12,000 | Condition (dated): +$6,000 |
| Line 2 | - | Lot size: +$3,000 | - | - |
| Net adjustment | - | +$11,000 | -$12,000 | +$6,000 |
| Adjusted price | - | $346,000 | $350,000 | $351,000 |
| Indicated range | $346,000 - $351,000 · Suggested list ~$349,000 | |||
Illustrative only. Weight the closest, most recent comps most heavily.
A rule of thumb: if a comp needs very large gross adjustments to line up with the subject, it is probably not that comparable. Drop it or de-weight it.
Step 5 - Reconcile to a price range
You now have three adjusted prices. Weight the closest and most recent comps most heavily; a sale from last month around the corner tells you more than one from six months ago across town. The tight cluster of adjusted values is your indicated range. In the worked example, the three comps land between about $346,000 and $352,000 - a defensible range with the middle near $349,000.
Step 6 - Set the pricing strategy
The range gives you options. The seller's goal picks one:
- Price to attract offers. List at or near the bottom of the range to invite multiple bids and potentially bid the home up.
- Price to sell fast. List at the middle of the range with room to negotiate.
- Price to maximize. List at the top and be prepared to wait or reduce.
A worked CMA example
Read the adjustment table above as a story. Comp 1 sold at $335,000 with one fewer bath and a smaller lot, so we add $8,000 for the missing bath and $3,000 for the lot - adjusted to about $346,000. Comp 2 sold higher at $362,000 with 250 extra square feet, so we subtract $12,000 to compare like for like - about $350,000. Comp 3 sold at $345,000 in dated condition, so we add $6,000 for updates - about $351,000. Range: $346k-$352k. Suggested list: around $349,000.
Tools for running a CMA
None of these replace the judgment step; they change how fast you get to it.
| Tool | What it is | Strengths | Limits | Best for |
|---|---|---|---|---|
| MLS comps | Sold-home data from the local multiple listing service. | Most accurate. Includes concessions, condition notes, and photos. | Agent access only; presentation is basic. | Any serious CMA - this is the source of truth. |
| Public property records | County recorder and tax assessor data on sales and property details. | Free and public. Verifies sale prices and property specs. | Slow to update; no condition or concession detail. | Cross-checking MLS comps or a DIY sanity check. |
| Automated home-value estimators | Algorithmic estimates from consumer real estate sites. | Instant, free, and useful as a rough starting point. | Blind to condition, updates, and hyper-local factors. | A first-pass number before you do the real work. |
| Dedicated CMA software | Tools built to pull comps, calculate adjustments, and produce a presentation. | Fast presentation and consistent formatting for clients. | Costs a subscription; quality still depends on the comps you pick. | Agents running many CMAs who want a polished report. |
Common CMA mistakes to avoid
- Cherry-picking comps that support a price the seller wants to hear.
- Ignoring condition. Two homes with identical specs can sell $30,000 apart on updates alone.
- Using stale sales from before the market shifted.
- Over-adjusting. If the plus and minus numbers get large, the comp is not really comparable.
- Trusting one estimate. The whole point of the rule of three is that any one comp can mislead you.
After you set the price
Once the list price is set and the home goes under contract, the documents, disclosures and key dates behind the deal are what a brokerage answers for. That is the job of real estate transaction management software - see the full picture at real estate transaction management software. If you are also weighing how to list, our guides on the seller net sheet, the flat-fee MLS model, and how to write the listing description pair well with this one.
Frequently asked questions
How do you do a comparative market analysis?
Define the subject home, pull at least three recent nearby sales of similar homes, screen out poor matches, adjust each comp up or down for differences, reconcile the adjusted prices into a range, then set a pricing strategy.
How many comps should a CMA use?
At least three recent, nearby, similar sales. Many agents use six to ten to capture a fuller picture, then weight the closest and most recent most heavily.
How do you adjust comps in a CMA?
Add value to a comp that is inferior to the subject and subtract value from one that is superior, feature by feature - square footage, baths, garage, lot, and condition - to estimate what each comp says the subject is worth.
What is the best tool for a CMA?
The MLS gives the most accurate sold data and is the agent standard. Public records and automated estimators help for a rough range; dedicated CMA software speeds up presentation.
Is a CMA the same as an appraisal?
No. A CMA is an informal agent estimate for pricing. An appraisal is a formal valuation by a licensed appraiser, usually required by a lender.