Whose Figures to Trust?
Which Trend to Believe?
Which Trend to Believe?
There are many sources.
Many local media use figures from the MLS as compiled by a real estate broker and information from industry trade groups. As I read those reports, particularly beginning in late 2006, it was clear to me that the “compiler” was looking at the figures differently than I was seeing the same data. I was reporting in my monthly communication to my clients that I was seeing a slow down in volume and in price increases and many other licensees were talking about price increases and the strong market. Going into 2007, I was very busy while at the same time seeing more inventory and more negotiation. My clients were able to make decisions based on what was really happening, not what was reported.
All real estate is local.
Yeah, I know you’ve heard that about politics too. It is at least equally so for real estate. Even with the overall decrease in Denver area home values over the past few years there are pockets that have done much better along with those areas that have fared worse thant the averages. What you care about is the neighborhood where you are living or purchasing. Be certain that if you are purchasing that your broker evaluates your prospective home using sales in the immediate area. It is very easy to go outside and support a higher price. If you have been diligent in your reasearch and hired an Exclusive Buyer’s Agent (EBA) then you should have someone on your side who will be doing just that.
Area trends do have value.
It is worth knowing what is happening in the overall market as those trends can have some effect on all neighborhoods and are an indication of the condition of the area economy. So, back to the original question, whose figures to believe? I have looked at reports based on MLS data, Zillow data and Standard & Poors/Case-Shiller data. It is my opinion that the “S & P/Case-Shiller” methodology and therefore the results are most accurate. It is the only system that tracks “same house sales”, has built in filters for anomolies and considers whether the sale is a “lender/seller” or a consumer seller. The other two consider all sales and can be skewed by several extremely high dollar sales or by a proliferation of non-market transactions.
So, what is happening in the Denver area?
According to Case-Shiller, Denver is one of only four of the twenty cities that they track that showed overall price increases from November 2008 to November 2009 (The most recent month that has been released). Overall, the Denver changes show considerably less “swing” than does the 20-city index. Also, and very interesting’ is that the same graph is heading into positive territory.
Is it a good time to purchase in the Denver area?
Probably so for many neighborhoods. Check your target area very carefully as there are still areas where values continue to decrease. Better yet, engage me to assist with your purchase and know that I will always be on your side.
Russ Murray 303-721-1100 russ@buyerbroker-denver.com