Every month new statistics are published regarding the state of the housing industry. Recently these statistics seem quite depressing! While not discounting the fact that the real estate market has been soft in most areas of the country, several factors combine to make these statistics somewhat sensational and rather misleading.
In the first place, all real estate is local. Just like the old joke about location, location, location. National statistics don't tell the story of what conditions are like in your area.
Furthermore, even if you separate the local statistics into average sold price or median sales price, it still doesn't tell the whole story. Average sales price is arrived at by taking the total sold prices and dividing that figure by the number of homes sold. But even this figure doesn't tell you what you need to know.
What are your particular neighborhood figures?
Are higher priced homes selling well?
Are medium priced homes taking longer to sell?
Is there a slow-down among lower-priced city homes?
In other words, you see that figures need to be broken down into neighborhoods, types, and price ranges in order to be meaningful. How long the homes took to sell is also a factor that usually isn't mentioned in the media.
What about median home prices? The median sales price simply means that half the number of homes sold at above the median price, and half the homes sold below it. But is that as meaningful as it would seem? Not so much as one would think. The problem with both the average price and the median price is this: we're comparing apples and oranges.
If it were the same houses that we were comparing from month to month, the comparison would be meaningful. But we're not comparing the same houses. We're comparing a whole different set of houses that went to settlement each month. Were they nicer than the houses that sold the previous month? Were they on equally nice lots? Were the sold homes predominantly in different price ranges? The overall trends can be meaningful in a general sense, but month-to-month comparisons aren't particularly useful.
The thing to keep in mind out of all this is that in order for real estate statistics to be meaningful, they must be as specific as possible to a particular neighborhood and price range. An experienced Realtor can help you analyze the data.
If you have any questions on real estate home sales in Lancaster County, PA, please feel free to call me at (717) 951-5552.
Brian Schulman offers expert real estate representation for buyers and sellers of homes in Lancaster County, PA. To learn more, visit http://www.FindLancasterHomes.com/
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