This is the continuation of an article on understanding median home values…
This graph illustrates what the median size home sold for in Belmont during the preceding 12 month period. Note this does not take into consideration individual characteristics of the home such as updating or level yards which greatly affect the home’s value.
Applying a trend line to the same graph shows us that the median price is approximately representative of current market conditionsâ€”prices are not rising at the same rate as they were a year ago and may in fact be on a decline.
Looking at all of San Mateo County, a much larger market sample, the median price is clearly rising despite fewer sales.
While data supporting the theory that larger homes are selling is unavailable for this period, which likely is the case. Fewer first time buyers qualify to purchase a home and are more susceptible to media reports of declining home values. Trade-up buyers, who already own a home and typically have a more positive experience of home ownership, are trading up for larger homes which in turns skews the median home price reported.
Data can certainly be confusing; especially when it is delivered by the media without analysis. Without proper industry knowledge, these statistics would conclude that Belmont home prices are skyrocketing. By the way, how come that hasn’t made the news?