Real Estate Market Reports
A real estate market report is ever-changing. It can change daily, or even hourly. It is fluid data that changes every time a property is closed because that’s what it is…information about residential home sales. It can also be commercial real estate, but for our purposes, we focus on single-family homes and condos.
One thing to remember is that the numbers I use are from the local RealTracs system. These are homes for sale by realtors and will not include for sale by owner properties.
What is an Absorption Rate?
Many times a market report will also include the current absorption rate. The absorption rate is calculated by dividing the number of area home sales in a given community by the number of homes currently for sale. If the answer is below 15%, there is a buyer’s market. When it gets above 20%, then it’s considered a seller’s market.
I like to use median prices because they give a more accurate price in any given area. Average prices can easily be changed by a very large or very small home sale.
Click the following communities for Area Stats and Trends:
View latest Market Report for Sumner County TN
Market Value is determined by an appraisal, which is ordered by your lender. There are many different types of appraisals, but for buying a home we are concerned with a market value appraisal. The bottom line is what the appraiser believes the home could be sold for in the current real estate market. The cost of this is generally $400-$750 depending on the size and location of the particular property.
Your Realtor can provide you with a CMA (Comparative Market Analysis) to use in determining your offer price, but the lender will want a full appraisal. The licensed appraiser will use recent sales of comparable properties, location, condition and quality to determine value. More value is given to ‘above grade’ square footage, so a basement is given less value. It doesn’t make sense, does it? A basement is expensive to dig out and waterproof. Then, if its finished out the same as the upstairs, why is it lower in value? Go figure!!