Who determines the market value of a property ?
The seller of the property is the person who sets the price of the property (specially
residential property), and not an appraiser. This is because sellers normally
do not order an appraisal when selling their homes. Sellers wish to
obtain the highest selling price possible for their homes and hence do not want to
be bound by the appraiser's assessment of their home. The real estate agent,
who receives a percentage of the price as compensation and often represents
the seller in the transaction, normally assists the seller in setting the sale
The real estate agent performs a comparative market analysis (CMA). The appraisal
laws in most states allow real estate agents to perform CMAs without an appraiser's
license or certification. A CMA is a necessary part of the agent's preparation
for a listing and consists of examining sales of properties in the area to arrive
at a listing price. The reliability of the CMA depends upon the agent's experience
and the characteristics of the property and the surrounding area. Typically,
the agent will suggest a selling price to the seller based upon the analysis.
However, the seller may not accept that price and choose to list the property
for a higher price.