As we cover the housing market performance for the Bryan-College Station real estate market, there might be a few terms that you find unfamiliar. This blog post is designed to help you understand what all those metrics mean. They include:
- Median Price
- Active Listings
- Closed Sales
- Days on Market
- Months of Inventory
- Listing Price Distribution
Real Estate Market Data Point Glossary
What is does “median price” mean in real estate?
A median price is the middle price point of all homes for sale in a specific location for a specific time frame. As an example if you had 99 homes priced between $300,000 to $500,000, the 55th home in that segment would be the “median price.” It’s different from the average or “mean” in that it’s not an average of all prices, but the price point at which 1/2 the home prices are higher, and 1/2 are lower.
The real estate industry uses the median to account for any homes that might sell extraordinarily high or low in a market. It gives a clearer picture of the overall price of the real estate in the area.
What is an “active listing” in real estate?
An active listing is any real estate property that is available on the market. Active listings can have offers submitted on them, but those offers have not yet been accepted, so it’s still available for other homebuyers to put in competing offers.
The number of active listings in a real estate market is an indication that new properties are entering the market while existing properties continue to be listed and sold. The higher the number of active listings, the more buying power homebuyers have.
What is a “closed sale” in real estate?
A closed sale means that the ownership of the property has actually transitioned to the new homeowners. Once a listed property goes under contract, that means that both the buyer and seller have committed to the transaction, but there are many additional steps involved until the property title and full ownership is actually transferred. A property can be listed as sold during the closing process before it has actually transferred ownership.
What does “days on market” mean in real estate?
The “days on market” metric in real estate statistics keeps track of the average number of days a property remains active on the market. This is an indication of how quickly homes are being sold. Typically, you’ll find good value homes in up and coming neighborhoods spend fewer days on the market than luxury properties. The lower “days on market” average, the more active your real estate market is.
What does “months of inventory” mean in real estate?
In real estate, “months of inventory” refers to the number of months active listings are available based on the number of sellers and buyers in the market. It’s calculated by diving the number of current active listings divided by the number of sold transactions the previous month. This statistic is also sometimes called the “supply.”
What does “listing price distribution” mean in real estate?
Listing price distribution is a metric that keeps tabs on how asking prices are divided up among key price points. Often you’ll see market prices broken down into 100,000 increments. This metric gives an overall view of the average asking prices for a segment of real estate in an area.