The Real Deal

Data on home sales will tend to differ

By Jean Newton

One headline says "Bay Area Home Sales Down, Prices Leveling Off," while another reads "Median Home Price Up 8.6 Percent, Homes Sales Increase 2.3 percent." Both sets of information were released on the same day recently, reflecting numbers crunched for the month of August. How can they differ so much?

It's all in the way the numbers are interpreted. The articles tabulate prices two different ways. But even after factoring this in, numbers will differ, because criteria for each are defined differently.

It's also important to note that although the data from August is the most recent available, it does not take into account the tragic events of Sept. 11. According to California Association of Realtors President Gary Thomas, "It remains to be seen what long-term impact the events of Sept. 11 may have on the residential real estate market in California."

In data released by DataQuick, a company that monitors real estate activity nationwide, it was noted that the numbers obviously precede the tragic events of Sept. 11. DataQuick President Mike Ela said, "What remains to be seen is what effect those events and the U.S. response to them will have on home sales. Uncertainty and turbulence may give the market pause, or people may move assets into real estate as a safe haven. Nobody knows."

What should homeowners believe when they see differing reports on the status of the market? How can they really know what is going on in their own local neighborhood?

Information that is provided is probably best used for review purposes. Each report that is issued should be considered a snapshot that provides certain information that might or might not apply to an individual's situation. Reports that give out statistics and forecasts can provide good background information when trying to determine what course of action to take.

There is, however, no substitute for a qualified Realtor who can take those numbers and bring them into perspective for a client. Realtors have the hands-on advantage of knowing what is happening in the local real estate market. Since they are actively participating in the market and talking directly with buyers and sellers, they most likely have the most up-to-date information available.

In addition to a broad perspective of the economy and financial information on mortgage rates, Realtors keep track of comparable sales in the neighborhood. Sometimes comparable sales are adjusted for slow-downs or speed-ups in the market. Overall, comparables can be a good indication of the value of a home, along with other factors determined by a Realtor. If a home is priced right, it will sell, and Realtors are still seeing multiple offers in the current market, though nowhere near the frenzy of the tech boom market.

When headlines stand out in the newspaper, it's important to take time to read the story. Placing a call to a Realtor who can help interpret the numbers will put them into the proper perspective.

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Information provided in this column is presented by the Realtor members of the Silicon Valley Association of Realtors. Send questions on any topic to jnewton@jnpr.com.

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