July Home Sales in Northern Virginia
Recent statistical data suggests that the average home sales price went up in the last two months. Great news for sellers, right? The other side of that news is that average sales have been wildly inconsistent with no discernible pattern – going up for a month or two then down for two or three months.
July Data for Northern Virginia
Let’s look at how this works. Unfortunately, with real estate, “average” does not give homeowners an accurate picture of the market in their area. Average home prices are calculated by dividing the number of homes sold during a fixed period into the total of all sales prices. If lower end homes are selling more than higher priced ones, then the average goes down. If higher priced homes are more popular then the average goes up. (And, of course, inventory changes from month to month.)
Another measure of home prices is the “median” price where half of all homes sold for less and half sold for more. As with “average”, the “median” statistic does not give homeowners any real idea of how much the market value of homes has declined or appreciated in their area.
The better method of determining the percentage fluctuations of market prices is to compare similar homes in a specific area over a fixed time period. For example, if you wanted to know the percentage drop in prices from 2006 to today, I would research the 2006 sales price of three to four homes compared to the recent sales price of three to four similar homes in the same area.
The overall comparison will give a fairly accurate percentage drop – or increase – of home prices in that area.
The statistical information provided above, by county, shows the supply of inventory which gives us a trend for the future. Where supply is coming down it could signal a market change. Where inventory is still rising, there is a continued downward pressure on prices.
For a more detailed analysis of your neighborhood and your home, call me at 703.927.4554 for a free personalized Comparative Market Analysis (CMA).