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One reader provided an interesting observation about our graphing and charting techniques here on the Tallahassee Real Estate Web Site. This reader wanted to know why we relied so heavily on real estate one-year trend charts, as opposed to non-trended data graphs.
Specifically, the reader asked
So much of your data focuses on 365-day analysis. Given the dynamics of real estate today, it would be nice to have monthly information as well. I understand seasonality makes it hard to compare between months. But sometimes it’s just nice to know what is actually selling and what isn’t in the current market.
I am envisioning something like your inventory report, showing for the past month the number of condos/THs that sold and the number of single-family detached homes that sold. Sales data by price range and region (e.g. NE, NW, SE, SW) would be helpful too.
By the way, keep up the good work. In my opinion, this is the best RE site covering any metro region…at least the best free one.
This is great feedback and I will get more non-trended reports embedded into future blogs. But I also want to demonstrate the value of these trended results, with a real-world Tallahassee neighborhood report.
Bull Run Subdivision Home Sales Report
In order to demonstrate my perception of the value of the trend report, let’s take a look at arms-length home sales in the Bull Run Subdivision in Tallahassee, Florida. The graph below shows the number of homes sold each month, and the corresponding average prices of the homes sold that month.
The information in this real estate graph shows the recent sales and prices, but do you get a real feel for what is occurring from this? Are sales up in Bull Run? Are sales down in Bull Run? What do you really see? If anything, I see a general downward trend on home prices, with a nice little “spike up” in the past three months. What do you see?
Home Prices Still Dropping In Bull Run Subdivision
This next real estate graph removes the seasonal bumps and jumps in the graph above by annualizing every point in the graph. To me, the results tell a much more focused picture.
When I created these two real estate graphs, I had to look at them several times because I thought I had made a mistake. The first graph of Bull Run home sales seems to show a much more stable picture, while the second graph makes it appear as if Bull Run home prices are still dropping.
The problem with the first graph is that your mind (at least my mind) cannot do the math and factor in weighted averages of unit counts and average prices. For example, looking at the first graph, there were five sales of homes in Bull Run in July 2009 for less than $300,000. There was one sale for more than $300,000 in September of 2009.
On the first graph, it doesn’t really seem to catch your eye, but when we trend it, we realize what is really occurring in the Bull Run Subdivision. The average price trend has dropped 25% ($100,000) since the peak of the market! That message hits me right between the eyes in the trend graph, yet I would not have even noticed it in the first graph.
Historical Arms Length Home Sales In Bull Run Subdivision
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Awesome stats and a one glance market snapshot. I wish you have one for the whole USA