Consumers can become easily confused and misinterpret housing reports. This may cause them to take action that could harm rather than help them when buying or selling a home.
The timing of reports also can be a problem. If you notice most housing reports are released three to four weeks after the fact, which may not reflect current market conditions. Like stock brokers trading stocks, timing is everything.
Relying upon dated information is like trying to decide what to wear today based upon a month old weather report.
Here is an example of how consumers can easily become confused. On Monday the tenth of March the Chicago Tribune published a front page story in their business section reporting Springfield as the best housing market in the Midwest. I had the honor to be interviewed for that story along with fellow RE/MAX agent Betty Shuster.
There is some clarification required about the story. The Tribune reported Springfield home prices were up 14.4% in 2007 from 2006, thus laying the claim to the fourth best appreciating city in the U.S. and the best housing market in the Midwest.
Here's what leads to confusion. The Tribune received those numbers from the National Association of Realtors (NAR). The methodology used by NAR is different from that used by the Capital Area Association of Realtors (CAAR). The criteria for NAR includes multiple associations of Realtors. Their definition of Springfield includes all of Menard, Sangamon, and Macoupin counties. NAR only counts stand alone single family homes.
CAAR includes condos, single family attached homes and the service area covers all of Menard, and Sangamon counties, and parts of Morgan, Christian, and Macoupin counties. So clarification point number one is the type of property, and the geographical areas are different between CAAR and NAR for reporting purposes.
An extremely significant difference, the numbers from NAR were fourth quarter comparisons, not the entire years of 2006, and 2007.
By using different property types, and geographical areas, combined with the fact that the comparison was quarterly not annual, added up to a lot of confusion.
Truth is Springfield's median sale price did increase from $99,000 in 2006 to $104,500 in 2007, an increase of 5.5%, something 90% of the housing markets in the country wish they could report.
Price is one of the three most important ingredients to successfully selling a home. Please don't over/under price your home based upon dated housing reports. Contact a reputable professional for the current, and accurate information about your housing market. Real estate is local.
