I never thought about the significance of numbers. Because I had zero intentions of becoming an economist, analyst, mathematician, statistician, or any professional that crunches numbers for a living, I figured I would leave that stuff to the experts. Then I became a realtor and quickly realized that this business is all about the numbers and I am the expert.
Each day agents across the country answer questions like: What is the value of my home? How long will it take to sell my house? How do I know if I’m paying a fair price? These questions are typical and easily answered. Reviewing statistical reports, pulling comparables and answering questions are all in a day’s work. When referring to numbers, realtors usually stick with ranges and rarely commit to solid numbers. Why? It is impossible to predict exactly what a house will sell for. I try to suggest a price range, support my proposal with sufficient data, and let clients make the ultimate decision. When a client purchases a home, I select comparable properties and give a range of fair market value.
Each month the National Association of Realtors and Greater Capital Association of Realtors, (GCAR) release data regarding the national and local housing markets. This information is important because it lets us know how the markets are performing in comparison to one year prior. Not only do these numbers influence consumer confidence, they also serve as a useful tool in predicting future trends. This month GCAR indicated that existing home sales in the Capital Region for the month of August decreased by 12%; however, pending sales increased steadily over the past three months, with an 18% increase in August compared to the same month a year ago. What does this mean? Pending sales refer to properties under contract. There was more activity in the months of June, July and August than during the same time last year. This is good news, and industry stakeholders hope those pending sales will boost closed sales in about 45 to 60 days, which is the average time a home takes to close.
Nationally, existing home sales were on a roll, they increased four months in a row-- April through July-- sparking predictions that we might be on the way to recovery. Existing home sales for August retreated by 2.7%; while nationally, the median home price dropped by 12.5%. In large part, this is blamed on the large number of foreclosures and short sales across the country which can skew the numbers. Locally, we faired okay, with only a 2% drop in median sale price from $198,800 in August of last year to $195,000 last month.
What do all of these numbers mean? What does the future hold for the local and national real estate market? I don’t know. And you know what? Nobody else does either. But these numbers have real power; they influence the decisions of buyers and sellers everyday. And although I think they’re important, I also think if you’re in the market to buy or sell a home, there is only one time that matters, and that time is now.
