A Florida real estate licensee is preparing a Comparative Market Analysis (CMA) for a seller client in Tampa. The licensee includes three comparable properties that sold within the last six months, all within a half-mile radius. However, one comparable is a foreclosure sale that sold for significantly less than market value. What should the licensee do regarding this comparable?
Correct Answer
A) Include it with a notation that it was a distressed sale and may not reflect market value
Correct: Including the foreclosure with proper notation allows the client to understand all market activity while recognizing the distressed nature of the sale. Why not B: Foreclosures can be included in CMAs with proper disclosure. Why not C: Distressed sales should not be primary comparables as they don't reflect typical market conditions. Why not D: Arbitrary adjustments without proper analysis are inappropriate and potentially misleading.
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Previous Question
Compliance case Granite Folder frames the issue this way. A Florida licensee preparing a CMA has three adjusted comparable sale prices: $335,000, $342,000, and $348,000. What is the average adjusted indication?
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Under Florida real estate law, what is the primary difference between a Comparative Market Analysis (CMA) and a formal appraisal?