Comparative market analyses and broker price opinions

Pricing tools

A comparative market analysis (CMA) supports asking-price and offer decisions. A broker price opinion (BPO) estimates likely selling price for a specified business purpose, such as marketing lender-owned property. Neither name makes the work an appraisal.

Build the estimate

Define the subject, intended use, and date. Select and verify comparisons by location, property type, size, condition, features, and timing. Nearby properties may serve different buyers. Closed sales supply completed transaction evidence. Active listings show competing asking prices. Pending listings may suggest direction before final prices are available. Expired or withdrawn listings may indicate unsuccessful pricing or marketing, but failure to sell can have other causes.

Adjust the comparable, keeping the subject as the benchmark. Subtract for superior features; add for inferior ones. A $300,000 comparable with a garage superior by a supported $10,000 indicates $300,000 − $10,000 = $290,000. Use market contribution, which need not equal construction cost. Reconcile the indications by relevance and reliability rather than mechanically averaging. Explain the price or range and its assumptions.

Service boundaries

An estimate neither guarantees a sale nor replaces an appraisal when required. Texas requires this written statement:

This represents an estimated sale price for this property. It is not the same as the opinion of value in an appraisal developed by a licensed appraiser under the Uniform Standards of Professional Appraisal Practice.

For a written estimate, reproduce it verbatim in at least 12-point font as part of the estimate. A Texas sales agent may prepare, sign, and present an estimate for the sponsoring broker, but submits it in the broker's name; the broker is responsible. These Texas requirements appear in 22 Tex. Admin. Code § 535.17(b)–(d). Pricing competence does not confer appraisal authority.