“Average Home Price” stats give “Faulty” Impression

Each month, newspaper articles across the nation publish ‘Median’ or ‘Average’ Home Sale prices showing this month’s sales prices vs. last month’s. A novice reader looking at the lastest figures, would then assume that prices in his/her market are either going up or down. NOTHING could be further from the truth. For example, if prices across CA or even a Los Angeles county moved upward this month, does it mean that prices in your neighborhood did too? Of course not. Similarly, if high end homes in your zip code tanked this month over last month, does it also mean that entry level homes in your zip code did too? The answer is NO.
NEVER determine Home Pricing on what is happening across the state, county or city. Go to your zip code and match apples with apples to get a realistic feel for upward or downward price movement. If you have a 3 bedroom 1500 sqft home, then look at only those statistics which capture 3 bedroom homes in the 1500 sqft range in your neighborhood and no further than a mile or so away. Yes, prices within a single zip code and differ dramatically. So again, look for prices as close to your home as is possible for the most accurate barometer of where prices are heading in any given month.
Bottom Line: To get the MOST ACCURATE statistics of upward or downward home price movement, only consider the specific market,(Your neighbohood + 1 to 1 1/2 miles away) and then use only the statistics that match the property you want to compare. In other words, don’t compare condo price movements to single family homes and don’t compare price movement of a high end home to an “average” home. Compare APPLES to APPLES to determine what the REAL HOME PRICE MOVEMENT in your neighborhood is this month compared to last month.

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Charles Sant'Angelo is a broker of 20 years with offices in the same Beverly Hills location. He has represented residential & commercial buyers & sellers in LA, Orange, Riverside & San Bernadino counties and as far away as Costa Rica. Whether you are a local or global 1st time buyer , a seasoned home buyer/seller or an investor, you will find that his professionalism & his 'Customer First' approach is the cornerstone to how he conducts business. Please visit our "About Us" page for more information or contact Charles direct at chas90210@gmail.com
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