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What's the difference between a CMA (bad or good), and an AVM valuation?

Pulled from another post...

"Possibly another post, but what separates issues with AVMs from bad CMAs? I've had more than a few bad CMAs, biased by a REA's antiicipation of what I wanted to hear."

Request : Try not to take this thread to the "personal level". - Thx
  • April 28 2012 - US
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Answers (3)

Profile picture for blue screen exile
As far as I can tell, there are only four differences:
1) AVM's factor in more unit sales rather than a handful of selected "similar".
2) AVM's are automated, and CMA's require more "hand's on".
3) AVM's don't have site visits; and CMA's are supposed to, at least have a drive by and some familiarity of the neighborhood.
4) Most CMA's are don't by people licensed by the State to do Real Estate Sales, but most AVM's don't require any licensing of any kind.
  • April 28 2012
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Profile picture for hpvanc
Accurate or inaccurate, CMA's when they don't meet the expectations of the party receiving them tend to be delivered personally with a "sugar coating," AVM's can't do that at this point.  I think that may be causing a gap in the perception of AVM's to CMA's, even if they arrive at essentially the same number some people will take more issue with the AVM value. 

Both can easily be and often seem to be inaccurate even without intent because to some extent they are based on the biases of the estimates creators.  AVM's should be more difficult to unintentionally bias, because they are a formula and take into account a much broader swath of data than the local markets that an agent specializes in and has their hopes pinned on. 
  • April 29 2012
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A CMA is prepared based on recent sales of similar properties in similar locations and takes condition, upgrades, remodeling etc. into consideration.

An AVM does not take condition or upgrades etc. into consideration because it does not have this information. Neither does it generaly take specific location into consideration. A couple of streets away and a home may be in a different school district or suffer from road noise etc.
AVM's can never be a substitute for a CMA that is prepared by a conscientious and capable real estate agent.

Bernard Gibbons

+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Bernard Gibbons, J. Rockcliff Realtors
DRE License # 01331583
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  • April 29 2012
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