What Is CMA (Comparative Market Analysis)?
A CMA pulls comparable sales (sold), active listings (competition), and sometimes expired listings (overpriced) to estimate market value. Agents use it to price listings and help buyers justify offers. For a $285,000 duplex in Indianapolis, a CMA might show three sold comps averaging $282,000, five active listings from $275,000–$295,000, and two expired at $305,000+ (overpriced). The analysis supports a $278,000–$288,000 value range. Investors run CMAs to avoid overpaying and to negotiate.
A CMA (Comparative Market Analysis) is a report that estimates a property's value using comparable sales, active listings, and expired listings—typically prepared by a real estate agent to price listings or support offers.
At a Glance
- What it is: Report estimating value using sold comps, active listings, and market context
- Why it matters: Informs offer pricing and listing price; supports negotiation
- Components: Sold comps, active listings, expired listings, adjustments, value range
- Who prepares it: Typically real estate agents; investors can run their own
- Limitation: Based on sales comparison approach—doesn't capture income approach for rentals
How It Works
The three buckets. Sold comps show what similar properties actually sold for—the strongest signal. Active listings show current competition and where the subject fits. Expired listings (pulled from market unsold) often indicate overpricing. A good CMA uses all three to bracket value.
Adjustments and range. Like comparable sales analysis, a CMA adjusts for differences: size, condition, features, time. The result is a value range (e.g., $272,000–$288,000) rather than a single number. Tighter ranges come from more similar comps.
Agent vs investor. Agents prepare CMAs as part of listing presentations and buyer representation. Investors can request a CMA from their agent or run their own using MLS access. For investment property, pair the CMA with income approach and cap rate analysis—the CMA alone may miss value from rental income.
Real-World Example
Marcus's CMA for a Cleveland fourplex. His agent ran a CMA: four sold fourplexes in the past 8 months, ranging $312,000–$348,000. Two active listings at $335,000 and $342,000. One expired at $365,000 after 127 days. After adjustments for unit count, condition, and cap rate, the CMA suggested $318,000–$332,000. The listing was $305,000. Marcus combined the CMA with NOI of $28,400 (7.2% cap rate) and offered $298,000. He closed at $302,000—below the CMA range because the income approach supported it and the seller was motivated.
Pros & Cons
- Structured framework for property valuation
- Agents often provide CMAs at no extra cost when representing you
- Sold + active + expired gives full market picture
- Supports offer pricing and negotiation
- Documented analysis you can reference later
- Agent-prepared CMAs can be biased toward closing (higher for listings, lower for buyers)
- Sales comparison approach only—misses income approach for rentals
- Quality depends on comp selection and adjustment rigor
- Stale in fast-moving markets
Watch Out
- Agent bias: Listing agents may run CMAs that support a higher price; get a second opinion or run your own
- Income property blind spot: A CMA values like a house; cap rate and NOI matter more for rental property
- Overweighting active listings: Sold data is truth; active listings are asking prices, not outcomes
Ask an Investor
The Takeaway
A CMA is a comparable sales–based property valuation report. Use it to price offers and listings. For investment property, pair it with income approach and cap rate analysis—don't rely on the CMA alone.