Which of the three approaches appraisers use in the appraisal process is most similar to a CMA prepared by a real estate professional?

The sales comparison approach is most similar to a comparative market analysis (CMA) prepared by a real estate professional because both methods focus on evaluating property values based on the sale prices of comparable properties. In a CMA, a real estate agent analyzes recently sold properties that are similar in size, location, and features to help determine a fair market price for a property. This approach relies heavily on current market data and trends to come to an appraisal that reflects what buyers are willing to pay for similar homes in the same area.

In contrast, while the other approaches, such as the broker's price opinion, the cost approach, and the income approach, provide valuable insights, they do not align as closely with the foundational methodology of a CMA. The cost approach focuses on the value of the land plus the cost to construct a new building, which does not reflect actual market conditions. The income approach is primarily used for investment properties and is based on the income-generating potential of the property, rather than direct property comparisons. The broker's price opinion, though somewhat similar to a CMA, is typically less formal and may not require the same level of market analysis as a complete sales comparison approach. Thus, the sales comparison approach is the most relevant to the process of creating