"REAL" Real Estate Statistics

The real estate industry has made quite a few headlines lately. From network news stations to websites across the internet - we are being bombarded by statistics about the market (usually obtained through the National Association of Realtors.)

It is important to remember that every market is unique. The market in San Francisco, California has little to do with the market in Culpeper, Virginia...but the national statisics don't differentiate. That's why it is important to know your local market.

Our Piedmont area is primarily served by the MRIS (Metropolitan Regional Information System). The MRIS provides monthly stats to member agents. (You can access them at http://www.mris.com/reports/stats/) It makes much more sense to use MRIS statistics than it does to go by national statistics, but should you relay completely on those stats?

The answer is "No." While the market snapshots provided by the MRIS database are very helpful for a quick overview of the market, a good agent needs to do his or her own research to get an accurate picture of the market.

To prove a point, I completed a search of the residential listings on the market in Culpeper County as of April 17, 2008. Here is what I found:

MRIS Total Listings: 874
Months of inventory predicted by last month's sales: 30

I could've stopped there, but I wanted to make sure that I was getting an accurate picture of the market, so I did some additional research. I found that there were 220 residential listings that weren't existing residences. How can that be, you ask?

Duplicates: 4 (usually the same home available with difference acreages)
Condos (To Be Built): 27
"Paper listings" (To Be Built): 189

Realtors representing builders use what is commonly known as "paper listings." You've probably run across them if you've searched for real esatate recently. They are easily identifyable by the "Similarity Photo" written across the photo or "To Be Built" in the description. While these paper listings are of vital importance to builders who need to show potential buyers exactly what they can get for their money, the unfortunate consequence is the negative effect on the market stats.

The REAL number of residences available: 654
REAL months of inventory predicted by last month's sales: 20

That's 10 MONTHS difference!

The moral of the story, folks: not all statistics are created equal. Make sure that you base important decisions on ACCURATE facts!