By Don Lawby
President, CENTURY 21 Canada
Let's face it, nobody wants to be average. It's the terrain of the
unremarkable-the realm of the safe middle ground. But while "average"
is by its very definition nothing to brag about, it does have its place in our
world. It shows us the big picture. It reminds us where we stand, right?
Well, to a point. In real estate, average prices in the form of market
statistics help us establish broad market trends. These figures convey the
lay of the land, and help homeowners compare, at-a-glance, the overall
market in a given province, region, or city. But these sweeping
generalizations lose relevance the moment you try relating them to the
largest single asset you will likely ever own: Your home.
Many of us would like to know how well our properties are holding their
value these days, while others, lured by low interest rates, are wondering
about getting into the market for the first time. In either case, the average
prices of a given city or region-the ones we see so widely reported,
because they understandably intrigue the widest range of people-likely
have little bearing on your own situation.
Enter a more useful metric: The "typical" selling price. A typical home is
the one you're most likely to come across in any given neighborhood. For
example, the average Toronto home sold in March for $394,099. But the
typical four-bedroom, 3.5-bathroom, 2,700-square-foot two-storey home
The Bridle Path neighborhood sold in the first quarter of this year for
$965,000. That's a difference of $560K.
The point? When it comes to residential real estate, average and typical
prices are like apples and oranges. The former sketches out the very rough
outlines of a given market, the latter fills in the details that are most
relevant to you. If you're considering a move, the only prices that matter
aren't in the headlines-they're down the street and a few blocks over
from where you live today, or would like to live tomorrow. And there's
nothing unremarkable about that.
Don Lawby is President of CENTURY 21 Canada.
CENTURY 21 Canada: www.century21.ca