There are numerous items that affect future home values, but I find that analyzing the Interquartile Range (IQR) is an immediate snapshot of value fluctuation. Monitoring the monthly Median price and the IQR will help you understand your homes current and future value. The InterQuartile Range (IQR) shows the price variance between the 25th and 75th percentile of sold homes. This indicates how spread out the middle 50% of sold homes are in this Area and an indicator of what the future Median value could fluctuate by. The Average price can be a misleading number in areas where homes fluctuate by millions of dollars as 1 very high home sale would give an Average calculation that is not accurate.
Refer to the Central Brentwood chart below: Central Brentwood Median Price for YTD 2014 was $2,350,000 and the IQR was $1,320,000. It would be safe to assume that the Median price could go up or down based on the IQR of $1,320,000. As you can see at YTD 2015, the median price increased by $1,057,500 to $3,407,500.
Advancing a year now to 2016, the 2015 Median price was $3,407,500 and the IQR being $2,608,750, which could be the range that the Median Price could adjust by. 2016 Median price decreased by $557,500 down to $2,850,000.
By looking at the Median basic statistics, being the Sold Price per square foot, home size and lot size; you can get a starting point to analyze home value - this is how appraisers start their valuations. Clearly, there are other factors to consider, year home was built or year home was remodeled, upgrades, natural lighting, pool, privacy, garage scenario, floor plan, views, busy street, etc., all these items will increase or decrease value.
In the below chart for Brentwood Glen, the IQR is smaller than the above area of Central Brentwood. A smaller IQR will usually mean a smaller increase/decrease in the median price. Year End 2014 median price was $1,460,500 and the IQR was $351,250. The Year End 2015 median price increased by $314,500 to $1,775,000 which was almost the entire IQR amount. Year End 2016 median price increased by $197,358 from Year End 2015 to $1,972,358 with the IQR being $539,750.
www.Lehoamiller.com or www.90049Brentwood.com
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