The writer, Pat Kennedy, was sharp enough not to simply rely on a marketwide average. A sale like Evermay’s $22 million throws off an average wildly, without necessarily telling you anything worthwhile about the other houses sold. Thus her
his chart depicts, high/low sales, averages, medians, and averages taking highs and lows out:
It’s an interesting chart, but for all the thought put into using different measures, the scale of the chart is so high that you can’t really make much use out of the bottom four lines. But in GM’s opinion, this is really the whole point. The top u-shaped line represents the highest sale price per year since 2007. It took big dive right when the overall market did, while most of the market was far below and just sort of puttered along.
This is similar to the analysis GM has done before. Kennedy adds an interesting wrinkle in her
his second post, showing how homes that sold twice over the last six years were typically sold for less the second time around (with an average drop of 6%). For homeowners to accept a 6% loss on such a huge investment is pretty solid proof that the market has been trending downward.
As a recent homebuyer himself, GM can say that his anecdotal observations match Kennedy’s numbers. Maybe it was just his biased observation, but GM believes that the market hit its bottom in the summer of 2010 (which was about six months before GM was ready to jump into the market–d’oh!). Two bedroom homes in the $700-900k range seemed to be particularly affordable during this period. Those deals seem fewer and further between now.
But the data, no matter which way you slice it, indicate that even in the worst real estate collapse in this country’s history, buying a home in Georgetown was a safe bet, particularly compared with the alternatives.