Why can’t you believe newspaper headlines?
Because they are written to attract readers, NOT to inform. This may be one of the more egregious misrepresentations. If consumers read the headline and then the article, they would likely come away believing that their house has indeed risen in value and/or that they should buy now because prices are rapidly increasing. Neither is really true.
Because for the purposes of most consumers, medians are not useful and gross market statistics are even less so. Medians simply indicate are that half the homes sold above this figure and half sold below. Consumers want to know how the market affects them. While I could not check every neighborhood and Zip Code, I did check two areas. One, a popular area in the City of Denver and one, a desirable area in the suburbs.
The results tell a different story from the article
Using the same methodology as the article, the Denver neighborhood showed a 16% decrease in the median and the suburban neighborhood a 6% decrease. Even within these individual neighborhood there are varying results for individual types and prices of home. Medians can change a lot based on the distribution of sales prices above and below.
What information can I trust?
The best will be from a market analysis prepared by someone you know and trust who is in the real estate business. That analysis will compare your home to recent activity in your neighborhood. Another option is to watch for articles that reflect information from the “Case-Schiller” index. Those of you following my blog know that I place more credibility with this index because it traces “same home sales”. Even with Case-Schiller you will want to look at the “micro”, not the “macro” figures. Just as with politics, all real estate is local.