A Comparative Market Analysis (CMA) is a pricing strategy developed by a licensed real estate agent to help determine a home’s current market value. It’s a manual, thoughtful process - not a plug-and-play tool. We evaluate recent sales of similar homes in the area, adjusting for differences in size, condition, finishings, and unique features. We look at the data the way appraisers do, based on past sales and market trends. However, we also think like buyers, considering how your home stacks up against the current competition. The result is a clear, competitive price range based on real experience and professional local insight.

An appraisal is a formal, third-party valuation of a home conducted by a licensed appraiser. It’s typically required by mortgage lenders during a home purchase or refinance to confirm the property’s value. The lender orders the appraisal, but the cost is usually paid by the buyer or homeowner.

The appraiser conducts a full visual inspection of the home, inside and out. They evaluate recent sales of similar properties, current market conditions, and any features that add or subtract value. Their report includes detailed documentation: a sketch of the home’s exterior, a map showing the property and comparable sales, photos, an explanation of how the square footage was calculated, and any other relevant information.

Unlike a CMA, which is used to price homes for sale and guide negotiations, an appraisal is required for lending and carries legal weight in the financing process.

Lenders base the amount of their loans on the value of your property and usually allow you to borrow a maximum of 75% to 96.5% against your property. Knowing what your home is worth allows lenders to calculate your equity in the home. The more equity you have, the better terms you will receive on your refinance.

If you’re doing home improvement projects to increase the resale value, you want to make sure you’re not pricing it out of the market. If your home is already priced on the high-end for your neighborhood, making too many improvements could make it more difficult to sell. When you get a valuation, you can see how your home compares with others in the neighborhood and let this guide your home improvement decisions.

If you want to borrow cash against your home, getting a Home Equity Line of Credit (HELOC) could be a good option. To qualify, you must have a certain level of equity in your home. Most lenders require at least 20%. Getting a home valuation will help you determine if you qualify and will be used by the lender to make a decision on your loan.

Though it’s not a necessity, simply knowing the value of your home is good information to have. It will help you plan for the future and deal with unforeseen circumstances when you might be in a position that requires extra money or a quick relocation. Knowing how much equity you have in your home and how much you may be able to borrow against it or sell it for will help you respond to any financial curveballs that life throws at you.