Beware the Averages

An article written by a senior business writer in the online version of today's Calgary Herald blogs echoes what we have been saying about real estate averages for years... beware the numbers!

 

His words of wisdom are that you should not fixate on the "average" number. It is equally - or even more important - to look at the median numbers and the price ranges that are selling.

 

As a perfect example he cites, "when CREB (the Calgary Real Estate Board Cooperative) released its monthly data for October recently, we discovered the average price for a single-family home sale was $455,399 for the month while for a condo it was $282,903."

 

Then he goes on, "But here's the interesting point. In October, 51.32% of single-family home sales in the city were for under $400,000. The most popular price point was between $350,000 and $399,999 where 17.31% of all sales took place in October."

 

And then for condominium apartments and townhouses, 43.21% of all sales took place in the $200,000 to $299,999 price point.

 

The other thing to keep in mind is that home prices in different neighbourhoods differ. This is due to many factors which include many things like: amenities, proximaty to transit, shopping or schools, age of homes, overall property maintenance, and the willingness of buyers' to pay for these factors. The average or median price of the city, or a quadrant of the city, does not reflect the specific price of your home or neighbourhood. It only indicates a trend. And this month's trend is down as the inventory continues to exceed demand - which leaves us further into a Buyer's Market.