Why understanding what buyers are actually comparing can be just as important as knowing your comparable sales.
When I prepare to list a home, comparable sales are an essential part of determining its market position. I look at what similar homes have sold for and how those properties compare in size, age, condition, location, lot, features and other factors that influence value.
But there is another question I have learned to ask:
What else can this buyer purchase for the same money?
It sounds similar to looking at comparable sales, but it isn’t quite the same thing.
The homes that help establish the value of your property are not necessarily the only homes competing for your buyer.
That distinction becomes particularly important when a home is getting online attention and showings, buyers generally like it, and the comparable sales support the price, but offers aren’t coming.
At that point, asking whether the home is simply “priced right” may not tell us enough.
I want to understand what buyers are choosing instead.
Buyers are not building a CMA
Real estate agents and appraisers analyze properties methodically. Buyers tend to experience the market differently.
Imagine a resale home priced around $550,000. The comparable sales support the price, and on paper its market position makes sense.
But a buyer searching around that price point may also find a newer or larger home at $600,000.
The buyer may ask:
“What do I get for another $50,000?”
If that additional investment gets them considerably more space, newer construction, a more desirable floor plan or fewer projects after closing, the $600,000 property has become competition.
Now look in the other direction.
Perhaps another home is available around $500,000. It may be older or need some updating, but a buyer might decide:
“I’d rather save $50,000 and make those improvements myself.”
Neither property necessarily has to be the strongest comparable for determining the $550,000 home’s value.
But both can take its buyer.
This is especially relevant in the North Metro Atlanta markets I work in, where buyers often have choices across multiple nearby communities. A buyer considering a home in Buford may also be looking in Suwanee. A Cumming buyer may be comparing resale homes with newer construction at a higher price point.
The geographic boundaries that matter to a CMA aren’t necessarily the same boundaries a buyer uses when deciding where to live.
That means understanding competition requires us to look at the market through the buyer’s eyes, not only through the comparable-sales search.
Comparable sales tell us what happened. The active market tells us what is happening.
Closed sales are essential. They show us what buyers have actually been willing to pay, and they provide the foundation for determining market value.
But they are historical.
The moment a home enters the market, another source of information becomes available: the behavior of today’s buyers.
Which listings are they viewing? Which ones are they touring? Which homes are going under contract? Which properties are sitting? Where are price reductions occurring? What objections keep appearing in showing feedback?
And perhaps most importantly:
What are buyers choosing instead of our home?
That information doesn’t replace comparable sales. It adds another layer to them.
The competitive environment can also change after a home is listed. New inventory comes on the market. Another seller reduces a price. A competing home goes under contract. Financing conditions change. Buyer choices shift.
So I don’t think of pricing a home as a calculation we complete before the listing goes live and then put away.
The initial CMA establishes our position. The active market tests it.
That ongoing analysis can tell us whether the original strategy is working or whether the market is giving us a reason to adjust.
Buyers shop the whole market, not a spreadsheet
Individual metrics such as price per square foot can be useful when analyzing similar properties, but buyers rarely make their decision based on a single number.
They’re comparing the entire package: purchase price, monthly payment, condition, size, age, location, lot, floor plan and what they may need or want to spend after closing.
So rather than asking only:
“How does our price compare?”
I also want to know:
“What else can this buyer purchase for the same money?”
And sometimes:
“What becomes available if they spend a little more?”
Those questions can reveal competition that might not appear in a traditional comparable-sales analysis.
Every listing needs to understand its competitive lane
Once we understand the buyer’s alternatives, another question becomes important:
Why should the buyer choose this home?
A property doesn’t need to be the best at everything. Very few homes are.
But it should have a clear competitive position.
Perhaps it offers the best condition at the price. Maybe it has the largest lot, the newest construction, a finished basement, no HOA, a particularly desirable location, flexible living space or major systems that have already been replaced.
In some cases, the competitive advantage may simply be price.
The important thing is identifying what the property can realistically offer that its competition cannot.
I think of that as the home’s competitive lane.
When a property doesn’t clearly own a lane, it can become the home buyers like but don’t choose.
And that brings us to another important distinction.
“They liked the house” isn’t enough information
Positive showing feedback is encouraging.
“Beautiful home.”
“Shows great.”
“We really liked it.”
“The price seems fair.”
Those are certainly better reactions than hearing that buyers disliked the property.
But if several buyers like a home and none of them choose it, I need more information.
I want to know:
What eliminated us?
Did they choose something newer?
Did spending a little more give them substantially more house?
Did they spend less and decide to renovate?
Was it the floor plan?
The lot?
The location?
Was there a feature they simply couldn’t compromise on?
Some of those things can be changed. Others can’t.
But understanding why the property is losing the buyer gives us much more actionable information than simply knowing the buyer liked it.
The listing funnel tells us where to investigate
I think about listing performance as a progression:
Exposure → Showing → Reaction → Decision
If buyers aren’t seeing the property online, I investigate exposure and marketing.
If they’re seeing it but aren’t scheduling showings, I look more closely at photography, presentation, price and competitive positioning.
If buyers are touring the property but repeatedly reacting negatively to the same condition issue, that points us in another direction.
And if they’re touring, responding positively and still purchasing another home, I want to study the homes they’re choosing.
Each stage tells us something different.
That’s why I don’t believe every lack of activity should automatically produce the same recommendation.
Sometimes the answer is price.
Sometimes it is presentation.
Sometimes it is positioning.
And sometimes the market is telling us something about the property or buyer pool that we need to understand before deciding what to do next.
What this means if you’re selling
Before deciding that a home is overpriced, under-marketed or simply “taking longer to sell,” I want to answer three different questions:
What homes establish its value?
What homes are competing for the same buyer?
What does this home offer that gives that buyer a reason to choose it?
The answers may lead to a price adjustment.
They may lead to different photography, better presentation or a change in the way the home is marketed.
They may reveal an important property feature we haven’t emphasized enough.
And sometimes the analysis may tell us not to change the price.
The important part is understanding why buyers are behaving the way they are before deciding what to do about it.
The takeaway
A CMA is an essential part of pricing a home, but it isn’t the end of the analysis.
Once a home enters the market, buyers begin giving us additional information through what they view, what they tour, what they reject and ultimately what they purchase.
That information deserves to be analyzed alongside the comparable sales.
Because sometimes the most valuable question isn’t:
“What are the comps?”
It’s:
“What else can my buyer buy?”
And understanding the difference can change the strategy.
Holly Norman
REALTOR®
Chris Alex Real Estate Group | REMAX Center
