Jim Meader, broker/owner of RE/MAX Today, has a few thoughts on the whole statistics game. For one thing, most people might not understand that the median-priced home recently reported in California indicates the midpoint of home prices, with half of all home prices above and half of all home prices below the median price.

This number is greatly swayed by what the two extremes are, versus what actually happened, Meader explained.

"The real story is not the average, median or some other number, but viewing the market in segments. If you view the market in segments— high, medium and low—you can look at what portion of the market is most active," Meader said.

Meader cites a headline that might read "Average House Price Plummets to New Low."

"The reality is all the most recent transactions were from the first-time-buyer market, which was the most active. Several things—interest rates, major job increase in a regional market area, or a large surge of new low-cost housing entering an otherwise stable marketplace—could cause this," Meader said.

"In this scenario, both the median and the average house price would be lower, but no market adjustment actually occurred to the existing housing stock. Only one market segment was more active than another. Why? The median and average do not look at the total market of all houses, which would be those for sale and those not for sale. It only looks at those which most recently sold," Meader said.

As a means to understand trends and developments, keeping track of the median home price does provide a benchmark for the market and gives people an opportunity for comparison to previous levels.

A knowledgeable Realtor can help decipher the statistics to help a buyer or seller determine the best course of action to meet specific individual needs.

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