Wondering why some headlines claim home prices are falling, when others say they're going back up? It's because some reports use the median home sales price. And sometimes this approach isn't
MEDIAN HOME PRICES IN TODAY'S MARKET
Dated: August 21 2023
Wondering why some headlines claim home prices are falling, when others say they're going back up? It's because some reports use the median home sales price. And sometimes this approach isn't the best in today's market.
Here's how a median works :
Let's say you have three coins. If you line them up based on their value, the median is the one in the middle. With one nickel and two dimes, that's ten cents.
With two nickels and a dime, the median is five cents. The coin values remain the same, the data's just skewed by the mix.
With today's higher mortgage rates, people are buying less expensive homes to keep their monthly housing expense within their budget. And that's causing the median home sales price to decline.
So, you're gonna continue to see headlines that don't paint the full picture. When you do, remember the coins. Just because the median goes down, it doesn't mean prices are falling.
Have questions about other things you're seeing in the news about the housing market? I can hep. I know what's going on nationally and in our local market.
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