How Price Trends Affect Your Bottom Line

From a Buyer OR a Seller Perspective

Most people like to generalize the real estate market as being a buyers or sellers market – hot or cold, or weak or strong. While it’s good to be thinking, a good investment requires one to take it a step further.

Recognizing the fact that real estate is very location specific, buyers and sellers must look deep into the specific data of sub-markets to determine the current market trends. This better enables clients make more informed buying and selling decisions.

Generally, when inventory in any given sub-market is substantially higher than 6 months, the buyer has an advantage. When inventory is below six months, the seller has an advantage.




Sample Data Mapping: Price Trends

The map below (click to view full size, and then click that map again to zoom in) shows single family home sales in the most recent 12 months versus the 12-month period of the prior year. In this image, we are comparing the period (10/1/09-9/30/10) to the prior 12-month period of (10/1/08-9/30/09). Buyers and sellers need to know that months of inventory (MOI) represents a “normal” market. Here, neither the buyer or the seller is at a distinct advantage.

What does this information tell you?

As a whole, this information helps you to realistically assess the factors that will affect your buying and selling decisions, such as the time it might take to buy or sell your home at a particular price point in a very specific sub-market or neighborhood. These are just some of the factors that you should consider when buying or selling in your given sub-market. To learn more, read about Heat Maps and Price Trends in our blog.

Need more data?

Other information I can provide on price trends for any given sub-market is:

• average # days on market
• price change most recent 12 months
• # of homes sold in the most recent 12 months
• # of homes currently available for sale
• current months of inventory




Brain Hurt?
Give yourself two-minute break and take the Impossible Quiz below, then let me know how far you can get. I’m on question 10.

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