Median Price Vs. Average Price
Often times in real estate statistics, we refer to median price and average price. So which is better?
To arrive at the average price, one would take the sum of the values and divide it by the number of prices being analyzed. This would give you the average.
Median price would be the number where half the numbers are lower and half the numbers are higher. In Real Estate, that means the median is the price where half the homes sold that month were less expensive and half were more expensive.
Below are 2 examples of fictitious real estate sales. Median Vs. Average
Average price = $106,625
Median price = $106,500
note: because the median would be between 4 & 5, add 105,000 + 108,000 / 2 = $106,500
As seen above, these 2 numbers came in very close from each other, but that’s not always the case.
Average price = $163,857
Median price = $108,000
The clear winner of this would be the median price in most all circumstances. When analyzing data within a neighborhood, zip code, or city, we are able to capture a fair amount of data. Average price can be skewed high by a handful of very high-dollar transactions while median will remain more consistent.
When looking at statistics and market reports, keep an eye out for Median over Average.
Effective January 26, 2015
FHA recently announced a reduction of 50 basis points (0.50%) on all new 30-year loans, making homeownership more affordable. This is the first time we’ve seen a reduction in MIP (mortgage insurance premium) since 2001.
FHA is not a mortgage lender; it’s a mortgage insurer. Just like most insurers, the FHA collects payments known as premiums to fund the claims it pays to lenders.
FHA mortgage insurance premiums are split into two categories:
The complete MIP schedule for FHA loans of $625,00 or less, are as follow:
To add more beauty to this, rates are at their lowest levels in close to two years. It’s an amazing time to buy or refinance. If we can be of any assistance, please contact us.
Happy New Year! We are excited about all the new growth and opportunity that lies ahead this year. At Call Realty, we wish you all the success that you deserve. Let's make this year one to remember.
Let's think this through when searching for a home. This applies to anyone searching for a home with or without a real estate agent. Follow this method of searching and you will have more homes to choose from. Why eliminate properties in your price range without knowing they exist?
For reference purposes I created a broad search. Obviously when searching for a home you will narrow it down more with more specifics.
Let's say as a "Buyer" you either qualify or are looking for homes in the low to mid $300,000. You or your agent may search for homes $300,000 - $350,000. If you're agent creates a "search portal" in the range of $300,000 - $350,000, or if you do your own searching with those criteria, you will be missing out on more homes.
In the broad search that I conducted through the MLS, I used the following criteria.
The search results speak for themselves. Many real estate agents still like to use the 99 "advertising" method. That's another discussion. Keeping that in mind, simply by reducing your search by $1,000 from 30ok to 299k, will result in possibly more than 10% more properties. Those 10% properties just might be the home you were hoping for.
Bottom line, think smart when searching for homes. If you are working with a real estate agent, communicate with him/her on how your search portal is created. I bring this up because many people don't set their searches up saying, "let's search 299k-300k. Most would round up to 300k-350k.
Hopefully you find this helpful.
First off, for the record, I do not care to use the word "normal". In referring to our Arizona real estate market, I'd prefer to use the word stable or healthy. With a market that has been up and down for so long, have we become accustomed to that kind of market? Change can happen very quickly that many are left uneducated with the current changes that impact Sellers, Buyers, and Real Estate Agents. Not keeping a close eye on those changes can end up costing you money in the future.
Over the past few years we have seen some large gains in real estate. The market has made the adjustments to closely follow where we should historically be. These past few months have created quite the buzz and confusion, forcing us to ask where the buyers are. Did they hibernate over the winter months, getting ready to come out? December, January, and February are always the slower months of the year and we are beginning to see some improvements for March.
In analyzing data over data, I've come to a few obvious conclusions. Listings continue to increase and our sales have decreased. This will increase the MSI (monthly supply of inventory) making the shift to a Buyers market. If we are following the trend from mid last year toward the end of last year, we are doing it all wrong. Those appreciation numbers are gone for now, and I believe that is a positive move to a more healthy market. It's far to easy to look at comps and assume that the home will quickly sell for top dollar. Remember, the market is adjusting and now is the time to be more competitive on your price rather than being forced to inch down on your price every month, ultimately leaving you with less than what you could have received.
Bottom line, days on market are increasing if Sellers and Agents do not make quick adjustments to asking prices. Price your home right, immediately from day one. Week one is when you attract most buyers. Buyers, the ball is in your court. Plenty of homes to see, good negotiating power, and great rates.
Apple coming to Mesa, AZ
It was announced on Monday November 4th, 2013, that Apple, Inc. will be build a solar powered manufacturing facility to manufacture sapphire material. Approximately 2,000 Arizona jobs will be created.
Governor Jan Brewer said "Apple is indisputably one of the world's most innovative companies and I'm thrilled to welcome them to Arizona," Brewer said. "Apple will have an incredibly positive economic impact for Arizona and its decision to locate here speaks volumes about the friendly, pro-business climate we have been creating these past four years. Their investment in renewable energy will also be greening our power grid, and creating significant new solar and geothermal power sources for the state."
Housing Stats. It's always fun to look at housing stats but more importantly the data we receive is information that should be analyzed on a regular basis to follow the housing trend. Most of the data I have received is from July 2012 toJuly 2013. Some of the important or interesting statistics that came are;
1. Sales Price: Up 27.1% year over year median
2. Foreclosures Pending: Down - 56.6%. WOW! That's Great!
3. MSI (Monthly Supply of Inventory): Still hovering at a low 2.5 months +-.
So are we in a bubble? Yes the increase in the average median sale price shows staggering numbers but let's not forget just how low we got from some of the all time lows a few years back. Also with foreclosures and distressed properties on the decline, I believe our market is showing to be more normal. Looking through and analyzing all the statistics coming in, it appears that our market is proving to be more stable with a good outlook to come.
These stats are provided by ARMLS and or Cromford Reports
Thanks to all those Call Realty agents for joining us at our holiday party. What a great time! Also, a huge thank you to all those who brought in your donations to "Save The Family foundation of Arizona".
In looking back from September 2011 going forward to September 2012 we can see a fast incline in home prices for single family-detached homes.
The median price for our local area in September 2011 was $120,000. In one year we have seen an increase of $40,000 to a current median price of $160,000. That equates to a 33.3 increase in one year!
Average price per square foot went from approximately $80 sq.ft. to current $102 sq.ft.
The economic outlook for AZ Real Estate is looking strong. Many economic forecasters are predicting 3%+ gains per month till the end of the year for homes under 200k. In the meanwhile, many home buyers are frustrated from loosing out on homes with several multiple bids while others reap the reward. April 2011 - April 2012: Inventory is down 40% from last year but closings were only down by 10% bringing the MSI (monthly supply of inventory) at only 2.5 months! Median price of homes are up 25% from April 2011.
Why would I write about this? Well, I believe it's an issue that needs to constantly be addressed. This is directed more to all the real estate agents and brokers out there, however is also applicable to everyone. First off let me put in the disclaimer that I am far from perfect but I am good at one thing, that is keeping the peace. I bring this up because as the broker of Call Realty, I deal with other agents and brokers that can't get along which requires my assistance to act as the mediator because they cannot work with each other. As real agents, it is our job to protect our clients and make sure that we have done everything we can to achieve a smooth transaction. Proper calm communication between all parties is a key element to a successful transaction. It is sad that we let our anger, stress, and pride to take control over ourselves. When this happens the chaos begins. One agent may be upset about one thing and the other agent is upset about another. Then the cycle begins in an endless circle of arguing and in the end, nothing is accomplished. Actually, we now have successful accomplished anger, stress, and pride. In all reality, was what we were upset about really a big deal? I would say 99% of the time NO. Unfortunately there will probably be times in your life that you will have to worry about certain events that take place in life, so don't let these little things get to you...just work through them. If we politely work together through the problems and issues that occur in a transaction, listening just as much as we calmly talk, I guarantee you that these issues will seem like the tiniest hurdle to jump over. How do you think our clients are going to feel if we get all worked up when things don't go as planned or as we hope they would go? Most likely they are either going to be more stressed out or also get worked up. That should never happen.
When I was a boy my father taught me one of the most important lessons in life. He taught me something that a very well known business man taught him. That is, "water off a duck's back". An insult or criticism that rolls off you like water off a duck's back. Don't invite confrontation just to convince yourself that you are right. If you do this, you are only bringing yourself down to the bottom of the ethics scale. Don't let yourself be affected by insult, criticism, or when things don't go as planned. Don't let it soak into you, just remember, water off a duck's back.