What Sold Last Month and Why It Doesn’t Mean Anything

Okay, it doesn’t mean much!

Many real estate agents across the country send out information about what has sold in the previous month. Interesting information, to be sure. But just how useful is it?

Here is the list Cheverly homes that went to settlement in January 2011:

Address Sold Price Settlement Date
2812 PARKWAY $  208,900.00 01/03/11
3213 CHEVERLY HILLS CT $  155,000.00 01/06/11
6304 INWOOD ST $  350,901.00 01/10/11
2401 59TH PL $  100,000.00 01/24/11
2816 LAUREL AVE $  247,500.00 01/28/11
6603 OAK ST $  285,000.00 01/28/11
DATA SOURCE: Metropolitan Regional Information Systems, Inc. (MRIS) NOTES: Properties not listed through this Multiple Listing Service are not reflected. The term “sales” represents ratified purchase contracts. Information is subject to revision.

It tells me:

  • How many contracts went to settlement last month
  • What prices the houses sold for

It doesn’t tell me:

  • Anything about last month’s market activity (after all, those houses may have been under contract for 6 months – it might tell me what the market looked like 6 months ago, but only if I saw everything that went under contract 6 months ago)
  • What the net selling price was – minus any closing help that the sellers agreed to pay. That sales price of $200k might look good, but it doesn’t tell you that the seller paid $12,000 of the buyer’s closing costs, meaning the actual sold price was closer to $188k
  • Trends – it doesn’t say a thing about trends – what direction is the market headed? You can’t tell that from a list of houses that sold last month
  • How many of those properties were distress sales (short sales and foreclosures)?

There is an agent who sends me information like this every month for property I own in another town. And I look it over every month. But since I want more, I figure you might too. So, over the next several days, I’ll be slicing and dicing some statistics that will give a more complete picture of the market. Follow this link – January 2011 market – for all the articles as they’re posted.

Stay tuned…

© 2011 Susan Pruden

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