Whether you’re a home buyer or a seller, understanding the real estate market is everything.
The real estate market doesn’t have to be an intimidating or unpredictable thing. With a few short steps, you can perform your own real estate market analysis without hiring a realtor. Then you’ll be able to pinpoint exactly when the best time to buy or sell will be.
Keep these steps in mind as you start planning your home sale or purchase this season.
How to Do Your Own Real Estate Market Analysis
1. Use online CMAs (Comparative Market Analyses) as a baseline only.
You can access comparative market analyses from many online housing sites, such as Zillow. Many homeowners or prospective buyers resort to these when performing their real estate market analysis.
However, it’s important to use these analyses as baseline information only. Oftentimes, online CMAs aren’t fully accurate or reliable. Online housing sites may only show a portion of the present real estate and not take into consideration things like seller concessions or even price per footage.
Online CMAs are a great way to get a general scope of what’s out there, but you’ll have to stick to your own research for higher accuracy.
2. Using data from your district and neighborhood, create your own CMA.
Identify your immediate neighborhood as well as your district. Then, make note of three to five houses that have sold very recently, ideally within the last three months. Additionally, write down three to five houses that are currently for sale.
Make note of all of these addresses. Do your best to stay within your specific neighborhood for now as you begin your real estate market analysis.
For each home, identify the amenities. Make a list of bedrooms, bathrooms, garage style, yard space, and other amenities. If you can, note the total square footage. You’ll want to compare your home in question with homes of the same approximate size.
3. Contact your local assessor’s office.
With this information in hand, contact your local assessor and ask for all the information you can gather on all of these homes.
The most important details you’ll want to get include total square footage, special amenities like hot tubs and sunrooms, the selling value of the home if it was sold, and when the home was built. It’s wise to ask when windows or shingles were replaced.
4. Break out your calculator.
Once you’ve gathered all this information, begin your calculations. All you’ll need to do is a simple average. Total up the assessed value of the houses sold and divide by the number of houses sold. This will give you the approximate market value of the home in question.
Do the same thing for the houses listed for sale. Now you have a CMA for your immediate area.
5. Expand your research to other neighborhoods and districts.
Now that you have generated your own CMA for your specific neighborhood, it may be helpful to conduct CMAs for nearby neighborhoods and districts. This will give you a greater sense of what the market is doing in your larger area. Such context can be valuable if you are looking to purchase a home and want some options.
If you do not feel comfortable creating your own CMA, you can defer to a real estate agent. Some agents may provide a CMA free of charge before additional services.
However, analyzing the real estate market isn’t just for professionals or agents. You can take charge of your home purchase or sale by following a few steps to identify market trends and the best time to make a move.
If you are attempting to sell your home, we can help you throughout the process, including identifying home worth and providing free reports. With Powerhouse Real Estate, your dream home or home sale is just around the corner!