Please Stop Quoting CNN! Real Estate Is Hyper-local.
Buyers, sellers, clients, readers, and everybody else.....I am begging you! Please stop quoting what you hear on the news regarding the real estate market. Now don't get me wrong, I am not saying that everything that is on national media outlets like CNN is wrong. But when it comes to real estate, national statistics just don't cut it.
That is unless you think that national media outlets know that your home at the top of a pretty hill, that your friend lives under high tension power lines, that your neighbor's home has mold, or that your boss's home was just remodeled from the ground up.
Of course they do not know that. When you hear statistics that the national home market did x, please keep in mind that it is an AVERAGE across 50 states! It lumps markets in Texas, where $300,000 buys you a 5,000 square foot mansion, in with communities like La Jolla, where $300,000 hardly buys you a bus pass. It makes very little sense to even put these statistics together, let alone make your investment decisions based on them.
The real estate market is perhaps more hyper-local than any market in our economy. This means that not only can you not compare a home in San Diego to a home in Wisconsin but you can't even accurately compare a home in Chula Vista to one in Pacific Beach.
Actually, it goes further. There are even neighborhoods where you can't compare one type of home to another within the same subdivision . Take a community like Santaluz, which is a gated golf course community adjacent to Fairbanks Ranch (which despite its proximity to Santaluz is a whole market of its own as well). Just in that one neighborhood, which is gated, there are custom homes, semi custom homes, track homes, bungalows, and small casitas that sit on the golf course in some cases and in less desirable locations in others. This is not to mention the European clusters of homes that are also found in the community known as sentinals, some with great views and others without.
Just from this small example, you should be getting a sense of just how hyper-local real estate can be when even within the same neighborhood. Santaluz is only one example of a place with many different types of properties that all demand different prices.
Now imagine the idea of using one number to describe the entire country's real estate market and you will start laughing at the thought as loudly as I am. Believe it or not, this is why real estate agents still exist. There is only so much that computers and national statistics can tell us, and at some point real estate becomes to personal and to human to rely on a guy in Washington telling you what your home in San Diego is worth.