As Greg Harrelson—head of Harrelson Group and our seasoned coach at Real Geeks—says, “If you want to own market share in your market, then you must first own mindshare.” One powerful yet often underutilized tool to achieve that is the Comparative Market Analysis (CMA). But what exactly is a CMA, and how can it transform your real estate business?
Let’s dive into it.
A Comparative Market Analysis (CMA) is a detailed report that provides insights into property values based on current listings, pending sales, and sold properties in a specific area. Think of it as a snapshot of the real estate market that helps buyers, sellers, and agents make informed decisions.
According to Greg, “For the most part, a CMA includes the prices of actives, pendings, and solds, along with the average days on market, square footage, and pricing per square foot. It’s essentially a tool to help evaluate property value.”
In Greg’s words, “When everything’s the same, it has no value.” A CMA not only differentiates you as a knowledgeable real estate professional but also positions you as a trusted advisor. Whether you're working with buyers or sellers, a CMA provides the data-driven foundation for decision-making, ensuring your clients feel confident in their choices.
You'll always trust a professional who doesn't only understand your particular situation, but the statistics and trends of the overall industry. The same is true in real estate.
While both CMAs and Market Activity Reports offer valuable market insights, they serve distinct purposes:
CMA: A comprehensive analysis prepared by real estate agents to estimate a property's market value, primarily used to set listing prices or make informed offers.
Market Activity Report: A broader overview of market trends, including active, pending, and sold listings within a specific area, helping clients stay informed about local market dynamics.
Greg emphasizes the value of Real Geeks’ Market Activity Reports, calling them a “version of a CMA.” These reports automatically pull in critical details—active, pending, and sold listings—making it easy to create and share CMAs with your clients.
Mastering the CMA means more than just understanding its components—it’s about leveraging it effectively to build relationships, educate clients, and stand out in your market. Here’s how Greg suggests you do it:
1. Understand the Basics—A solid CMA includes:
Active Listings: Current properties on the market and their asking prices.
Pending Listings: Homes under contract and their listed prices.
Sold Properties: Final sale prices and details such as square footage, bedroom/bathroom configuration, and days on market.
Pricing Insights: Average price per square foot, which can help set realistic expectations for clients.
2. Use the Right Tools:
Utilize tools like Real Geeks’ Market Activity Reports to streamline the CMA process. These reports provide up-to-date information on active, pending, and sold listings, allowing you to deliver accurate and timely analyses to your clients.
Here’s where the real magic happens: using the CMA to grow your business.
1. Build Trust with Past Clients
“Make sure every one of your past clients is set up to receive a Market Activity Report,” Greg advises. By sending monthly updates, you’re essentially delivering a CMA straight to their inbox, keeping them informed and engaged. This positions you as their go-to resource for real estate information.
2. Create Educational Videos
Greg recommends creating short, engaging videos to explain the components of a CMA and how they benefit clients. These videos can address both sellers (explaining how to interpret pricing data) and buyers (highlighting how CMAs protect them from overpaying).
Example message:
“Here’s how to understand the Market Activity Reports I send you each month and why they’re important for your property.”
3. Personalize Communication
When adding a new lead to your Real Geeks database, kick off the relationship with an email template explaining the value of CMAs or Market Activity Reports. This ensures they understand what they’re receiving and positions you as a knowledgeable advisor.
4. Add Value for Buyers
During buyer consultations, let clients know you’ll use CMAs to evaluate properties they’re interested in. Greg suggests saying, “When we find a property you like, I’ll send you a CMA and we’ll base our offer on the data. This ensures you make an informed decision and don’t overpay.”
5. Differentiate with Unique Content
Greg encourages agents to think beyond the CMA. “Take your listing agreement or purchase contract and break down the paragraphs people don’t understand,” he suggests. Educational videos on topics like due diligence clauses, home warranties, or home inspections can set you apart from competitors.
Understanding the significance of CMAs is crucial. According to HomeLight, the top 5% of real estate agents in the U.S. sell homes for as much as 10% more than the average agent. This underscores the importance of accurate pricing, where a well-prepared CMA plays a pivotal role.
Additionally, a report by Clever Real Estate highlights that CMAs help sellers set competitive listing prices and assist buyers in making informed offers, emphasizing their dual utility in real estate transactions.
Greg shared actionable advice to help agents implement CMAs into their workflow:
Automate Market Activity Reports:
Use tools like Real Geeks to send automated monthly reports to past clients. This keeps them informed and builds ongoing trust.
Even if they're not ready to buy yet, they might share the opportunities they see with friends or family, building you a referral system.
Focus on Education:
Create videos or other content explaining how to interpret CMAs. Share this material with your database to position yourself as a resource.
One of the main concerns people have with realtors is that they don't actually guide their clients through the home buying or selling process – instead, they're just looking for ways to get a bigger commission.
By positioning yourself as the agent who educates leads and helps them take advantage of opportunities by understanding the tools at their disposal, you'll gain their trust and they'll continue choosing and referring to you over other agents.
Be Proactive with Buyers:
Use CMAs to guide buyers in making informed offers during the negotiation process.
Again, this goes back to trust. As we've covered in the past, it is sometimes hard to effectively communicate the value in buyer agents. But by actively helping your buyers save money and leverage opportunities, you're clearly defining your role as their main advisor in this major life decision.
Expand Content Ideas:
Think beyond CMAs. Create materials on under-explored topics like financing, termite inspections, or contract clauses to stand out from the competition.
You could even make your own "realtor reacts" series, where each week you react to the changes in the CMA. For instance, why you think a particular house ended up selling much quicker than an objectively better one, or why demand in a particular neighborhood shot up, etc.
Leverage Personalization:
Customize email templates and videos to address the specific needs of your clients, whether they’re buyers, sellers, or homeowners in your database.
A CMA isn’t just a report; it’s a relationship-building tool. By mastering and leveraging it effectively, you can position yourself as an invaluable resource in your clients’ eyes. As Greg says, “If we increase the value to the people we’re working with, it’ll increase our conversion.”
Start today: dive into your Real Geeks tools, create those educational videos, and make CMAs a cornerstone of your business strategy. The more value you provide, the more your clients—and your business—will thrive.
If you want specific, personalized help from Greg himself on this or any other Real Geeks' topics (whether it's SEO, lead nurturing, increasing engagement, or growing your referrals) join his private coaching community, RGMastery.com.