Humber/Ontario Real Estate Course 4 Exam Practice

What should a salesperson use a comparative market analysis (CMA) for?

1. To list comparable properties for sale, but not those recently expired.

2. To make a recommendation as to the maximum listing price.

3. To include sources of information such as the local listing service and GeoWarehouse.

4. To estimate the market value of a property for appraisers.

The correct answer is: To make a recommendation as to the maximum listing price.

A comparative market analysis (CMA) is used by a salesperson to make a recommendation as to the maximum listing price. This is because the CMA compares the subject property with similar properties that have recently sold in the same area. By analyzing these comparable properties, the salesperson can advise the seller on the appropriate listing price to attract buyers while ensuring the property is priced competitively in the current market. Option A is incorrect because a CMA should include both comparable properties for sale and those recently expired to provide a comprehensive market analysis. Option C is incorrect as it details sources of information that can be used to prepare a CMA, but it does not define the purpose of the CMA itself. Option D is incorrect as estimating the market value of a property for appraisers is generally done through a formal appraisal conducted by a licensed appraiser, not a CMA prepared by a salesperson.