Posted in the last blog was a summary of North Tahoe/Truckee real estate sales activity for the first half of 2013 in comparison with the first half of 2012. What do those numbers mean if you are contemplating buying or selling.
A few key points:
The average and median prices were up 16% in the first half of 2013, while total sales were up only 5.7%.
The median days on the market was only 37 days in 2013…a drop of 44% from the number of days it took to sell a home in 2012. The average days on the market in 2013, however, was significantly higher, 92 days, just 19% faster then 2012.
Remember, median is the 50th percentile. To compute the average, you take all the sales, add up the total price or days on the market and then divide it in half. The average may be higher than the median when several very high numbers are reflected in the average.
What accounts for the significant differences between median and average when it comes to the days on the market, and number of sales?
Perhaps it is a sign of two markets:
The first market is one of well maintained homes that are priced competitively. Buyers are ready, willing and able to jump on these puppies as soon as they hit the market. These buyers are driving up the average and median prices, and driving down the median days on the market. The lack of homes that fit this description is why even though the buyers are there, the homes that meet their needs are not.
The second market is composed of a large supply of homes that need work and are priced too high. Some of these homes were purchased at the height of the market, and the sellers are not able to sell the properties at a lower price. And some are listed for sale by those who are only motivated to sell if they can get “the right price.” This market is reflected in the high average days on the market. What accounts for a median days on the market of 37, with an average of 92? A lot of homes that sit on the market for six months or a year or more before they finally sell…usually after several price reductions.
YOUR FRIEND IN HIGH PLACES 