Source content updated: August 2026. General education, not individual legal, tax, lending, or insurance advice. Check the dates and status notes before making a decision.
01
Identify genuinely comparable homes
Start with location, lot, property type, size, age, condition, layout, and the transaction’s timing. Two homes in the same city can serve different buyers or have very different costs. A renovation, view, larger lot, or unusual floor plan must be considered with evidence instead of a fixed assumed premium.
Separate what you know from what needs verification: condition, permitted improvements, roof and HVAC ages, boundary records, HOA obligations, and special assessments. An attractive photograph does not establish system quality, and a citywide average does not explain the candidate property.
02
Use recent closed sales as a baseline
Closed transactions show prices that actually occurred, but the terms, concessions, condition, and time period still matter. Compare the most relevant examples and explain why each belongs in the analysis. Avoid deriving an exact value by multiplying a broad average price per square foot.
A CMA is an estimate of selling price, not a licensed appraisal. If formal valuation is required for lending or another purpose, use the appropriate professional. Retain the assumptions and evidence behind a pricing range so it can be reconsidered when new information arrives.
03
Consider the homes buyers can choose today
Active and pending listings indicate competition, while expired or withdrawn listings may show offers the market did not accept. Nearby new construction can change the comparison through incentives, delivery timing, and financing terms. Asking prices are choices by sellers, not established sale values.
Read inventory, marketing time, and feedback within the same property segment. A slower broader market does not affect every home equally. Identify whether a candidate competes on condition, price, location, timing, or features, and use that positioning to guide presentation and launch.
04
Set review points and adjust using evidence
Agree on launch strategy and how to assess buyer response. Review showings, inquiries, feedback, competing price changes, and new closed transactions together. Low response may reflect price, presentation, availability, or competition; one metric alone cannot prove the cause.
Keep the decision tied to your goals and net proceeds. Review changes deliberately instead of making reactive daily adjustments or assuming a fixed number of days guarantees a sale. Document new evidence and the reason for any revision to the original strategy.
Your checklist
- Comparable property characteristics
- Recent closed sales and transaction terms
- Active, pending, expired, and withdrawn competition
- Condition and documentation
- Buyer response and agreed review points
- Net proceeds under multiple prices
Frequently asked questions
Can I use average price per square foot alone?
No. Location, size, condition, lot, features, and terms need to be comparable.
Is a price estimate a formal appraisal?
No. A CMA provides an estimated selling range.
When should price be reviewed?
At agreed checkpoints and when meaningful new market evidence arrives.
Official sources
Follow the linked official source for current rules and property-specific confirmation.
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