Warren County Ohio Real Estate News and Observations: Which Housing Numbers Should You Pay Attention To?

Which Housing Numbers Should You Pay Attention To?

inspect closelyTonight I'm gathering data for my Mason Ohio market reports:  Mason condos and Mason single family homes.

Pulling data is a crossover from my engineering life.  Extract numbers, process them, determine context and form conclusions.  Do it right and my clients benefit significantly.  Miscalculate and I could cost them tens of thousands of dollars, so it's an aspect of this job I take seriously.

There's a famous quote out there about "Lies, damned lies, and statistics" and it would be pretty easy to turn statistics into lies and damned lies with just a little context manipulation, and that's pretty apparent when I look at January's sales data.

In engineering analysis we have what are called "outliers",  They're data points that are SO different from the rest of the data pool that they just don't belong.  With the right rationalization you can exclude them from your calculations so you truly represent the population and not distort the results.

For instance, in Mason there's quite the range of selling prices.  In January, the least expensive home sold for $110,000.  The most expensive?  $1,900,000.  We're nearing 20x more than the least expensive, so do you think that one home can alter the results?

You bet it can, especially in a month when sales are lower as they typically are in January.  The net result?  That one home sales moves the group average from $332,000 to $376,000.  That's more than a minor adjustment.  And it's another reason I prefer using median price rather than average price to better assess a market.  That one home only moved the median $4,000.  That's WAY better than $44,000.

And that same expensive home?  They sold for $380,000 LESS than full asking price, so that can move the average sales to list % several digits by itself.  Instead of the usual 97-98%, we're under 95%.

So while it's easy to crunch the numbers, it's just as important to provide the context.  Is data skewed by a few outliers?  What's normal?  What's not?  What's the method of comparison?

Get those answers right and your conclusions become more valuable.

Tomorrow, I'll write those reports!  For tonight, it's time to feed our zoo :)

 

More questions about home buying or selling?  Just call/text  513-520-5305 or email Liz@LizSpear.com and we can discuss how we can best help you!

 

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The Liz Spear Team of RE/MAX Elite
Elizabeth Spear, ABR, CRS, Ohio License SAL.2002007747

William (Bill) Spear, CRS, Ohio License SAL.2004011109  Kentucky 77938
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Comment balloon 4 commentsLiz and Bill Spear • February 08 2019 01:55AM

Comments

I think that was a Mark Twain quote...I had a debate partner in college who was mesmerized by the opposing team...his turn was just exactly that quote "There are 3 kinds of lies...lies, damn lies and statistics.: and he sat down...we lost ...go figure.

Posted by Sally K. & David L. Hanson, WI Realtors - Luxury - Divorce (EXP Realty 414-525-0563) 2 months ago

I totally agree. Anything can be proved/disproved with numbers, based on what specific statistics are used. I used median price points also, for the same reason.

Posted by Kat Palmiotti, The House Kat (Grand Lux Realty, Monroe NY, 914-419-0270, kat@thehousekat.com) 2 months ago

Hello Liz and Bill - it's easy to see why and how people reviewing real estate statistics can be confused. So many unrelated numbers all combined in one report. This makes sorting through the "stuff" to pull out the relevant data so important.  Target meaningful numbers and a knowledgeable Mason, Ohio area real estate expert can assist you in that process.

Posted by Michael Jacobs, Los Angeles Pasadena 818.516.4393 2 months ago

Bill- I will often read some of the marketing reports here. The ones I find helpful are ones where the agent will give their explanation of what all of the numbers mean. 

Posted by Kathy Streib, Home Stager - Palm Beach County,FL -561-914-6224 (Room Service Home Staging) 2 months ago

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