What is the difference between "appraisal" and "comparative market analysis"?

The distinction between appraisal and comparative market analysis (CMA) hinges primarily on the purpose, process, and the entities involved in each evaluation. An appraisal is a formal and detailed assessment of a property's value conducted by a certified appraiser who adheres to established standards and methodologies. This professional evaluation often involves analyzing various factors such as location, condition, comparable sales, and current market conditions to arrive at an objective property value that can have legal ramifications, especially in financing or tax assessments.

In contrast, a CMA is performed by a real estate agent and serves as an informal estimate of a home's value based on a comparative analysis of recently sold properties (comps) in the same area. While it provides helpful insights for buyers and sellers, it is not as comprehensive or regulated as an appraisal. CMAs are primarily used to assist clients in setting a listing price or making an offer but do not hold the same weight as a formal appraisal in legal or financial contexts.

Understanding this key difference emphasizes the level of expertise and certification required for appraisals compared to CMAs, reflecting why the correct response clarifies the roles and formalities of each type of property valuation.