Sales are up and prices are down?
Shouldn't prices rise when sales volume rises? Yes, but there is always a lag time in real estate. To get to the heated market rapid increase stage or growth in equity stage first the sales volume must be at a greater rate than the "for sale" or listing volume. In order to get the sales volume demand up first the prices must be attractive at at a point where demand rises. The ol' supply and demand in action.
August demand was up! The Average Price declined.
Average price can be a misleading figure. What's more important is how your home fits into the market and the strength of that price range or market segment. This is the "what's selling" portion of how is the market?"
The reason for the shift or drop in the average price is not necessarily because houses suddenly became cheaper. What you can see is the decrease in the sales of homes in the $400,000 and up price ranges. In July for instance there were 25 properties selling for $400,00 or higher compared to 15 in the month of August.
So we'll continue to monitor the sales of those higher priced properties and the impact they have as well as the overall sales volume. With a larger spread of homes sold in the lower and mid price ranges we would expect a number of "move up" sales to follow suit and likely be reflected in September numbers.
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