Property Valuation
An appraisal is an estimate of value while a CMA (Comparative Market Analysis) is:
AA legally binding valuation performed by a licensed appraiser
BA broker's informal opinion of market value based on recent sales, not a formal appraisal✓ Correct
CRequired by Massachusetts law before any listing
DMore accurate than a certified appraisal
Explanation
A CMA is a broker or agent's informal opinion of value based on recent sales. It is not a licensed appraisal and cannot be used for loan underwriting purposes, but it helps sellers price their property.
People Also Study
Related Massachusetts Questions
- What is 'market value' as defined for Massachusetts appraisal purposes?Property Valuation
- In Massachusetts, 'paired sales analysis' is an appraisal technique used to:Property Valuation
- Which appraisal approach is most appropriate for valuing a single-family residence in a neighborhood with many recent sales?Property Valuation
- An appraiser uses three comparable sales to estimate the value of a subject property. The adjusted values of the comparables are $415,000, $422,000, and $418,000. Which value should the appraiser most likely assign?Property Valuation
- A Massachusetts lender requires a property appraisal for a purchase loan. The appraisal comes in at $490,000 but the purchase price is $520,000. The lender will typically base the loan on:Finance
- A Massachusetts 'market rent analysis' by a property manager is used to:Property Management
Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
Study This Topic
Practice More Massachusetts Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Massachusetts Quiz →