$\"What$ \n

The <\/span>National Association of Realtors<\/em> (NAR) will release its latest <\/span>Existing Home Sales Report<\/em><\/a> tomorrow. The information it contains on <\/span>home prices<\/a> may cause some confusion and could even generate some troubling headlines. This all stems from\u00a0the fact that NAR will report the median sales price, while other home price indices report <\/span>repeat sales prices<\/a>. The vast majority of the repeat sales indices show prices are <\/span>starting to appreciate<\/a> again. But the median price reported on Thursday may tell a different story.\u00a0<\/span><\/p>\n

Here\u2019s why using the median home price as a gauge of what\u2019s happening with home values isn\u2019t ideal right now. <\/span>According<\/a> to the <\/span>Center for Real Studies<\/em> at <\/span>Wichita State University<\/em>:<\/span><\/p>\n

\u201cThe median sale price measures the \u2018middle\u2019 price of homes that sold, meaning that half of the homes sold for a higher price and half sold for less. While this is a good measure of the typical sale price, it is not very useful for measuring home price appreciation because it is affected by the \u2018composition\u2019 of homes that have sold.<\/em><\/p><\/blockquote>\n
For example, if more lower-priced homes have sold recently, the median sale price would decline (because the \u201cmiddle\u201d home is now a lower-priced home), even if the value of each individual home is rising.\u201d<\/em><\/strong><\/p><\/blockquote>\n
People <\/span>buy homes<\/a> based on their monthly mortgage payment, not the price of the house. When mortgage rates go up, they have to buy a less expensive home to keep the monthly expense <\/span>affordable<\/a>.\u00a0More \u2018less-expensive\u2019 houses are selling right now, and that\u2019s causing the median price to decline. But that doesn\u2019t mean any single house lost value.\u00a0<\/span><\/p>\n
Even NAR, an organization that reports on median prices, acknowledges there are limitations to what this type of data can show you. NAR <\/span>explains<\/a>:<\/span><\/p>\n
\u201cChanges in the composition of sales can distort median price data.\u201d<\/em><\/p><\/blockquote>\n
For clarification, here\u2019s a simple explanation of <\/span>median value<\/em>:<\/span><\/p>\n
\n
You have three coins in your pocket. Line them up in ascending value (lowest to highest).<\/span><\/li>\n
If you have one nickel and two dimes, the median value of the coins (the middle one) in your pocket is ten cents.<\/span><\/li>\n
If you have two nickels and one dime, the median value of the coins in your pocket is now five cents.<\/span><\/li>\n
In both cases, a nickel is still worth five cents and a dime is still worth ten cents. The value of each coin didn\u2019t change.<\/span><\/li>\n<\/ul>\n
The same thing applies to today\u2019s <\/span>real estate market<\/a>.<\/span><\/p>\n
SBottom Line<\/h3>\n
Actual home values are going up in most markets. The median value reported tomorrow might tell a different story. For a more in-depth understanding of home price movements, reach out to a local real estate professional.<\/span><\/p>\n<\/div>\n\n<\/body>","protected":false},"excerpt":{"rendered":"
The National Association of Realtors (NAR) will release its latest Existing Home Sales Report tomorrow. The information it contains on home prices may cause some confusion and could even generate some troubling headlines. This all stems from\u00a0the fact that NAR will report the median sales price, while other home price indices report repeat sales prices. […]<\/p>\n","protected":false},"author":1,"featured_media":3921,"comment_status":"registered_only","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[12],"tags":[29,27,20,18,28],"class_list":["post-3920","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-insight","tag-idaho-real-estate","tag-north-idaho-homes","tag-rain-silverhawk","tag-real-estate","tag-sandpoint-idaho"],"aioseo_notices":[],"acf":[],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/sandpointrealtyidaho.com\/blog\/wp-content\/uploads\/2023\/05\/20230517-what-you-need-to-know-about-home-price-news.jpg?fit=750%2C410&ssl=1","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"jetpack_likes_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pdz2Zu-11e","_links":{"self":[{"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/posts\/3920","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/comments?post=3920"}],"version-history":[{"count":0,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/posts\/3920\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/media\/3921"}],"wp:attachment":[{"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/media?parent=3920"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/categories?post=3920"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sandpointrealtyidaho.com\/blog\/wp-json\/wp\/v2\/tags?post=3920"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}