ORLANDO, Fla. – Oct. 16, 2012 – “Florida Realtors Residential Price Index gives Realtors a new tool to help sellers understand home price trends in their market – and why that impacts the current value of their property,” says Dr. John Tuccillo, Florida Realtors chief economist.
Tuccillo says that many home sellers have an opinion about their home’s value before contacting a Realtor. They come up with a number by looking around their neighborhood, talking to peers and reading stories in the media. Sometimes, however, their estimate isn’t completely accurate.
“When a Realtor offers an expert opinion that conflicts with the seller’s opinion, the seller often questions the suggested price,” says Tuccillo. “Without hard data, it can be difficult for the Realtor to explain why a different listing price is more accurate or effective. The price index gives the Realtor more ‘ammunition.’”
Florida Realtors’ recently debuted the Residential Price Index. It tracks home sales relative to 2000 and includes price patterns from the past several years. By looking at same-home sales over time, it provides an accurate overview of price trends by state and – coming soon – by metropolitan area.
“The index, for example, tells us that prices in Florida – including most metropolitan areas in the state – stopped falling in January 2009,” says Tuccillo. “If a Realtor combines the Index data with other data in a listing presentation, such as neighborhood absorption rates and recent comparables, it’s easier for sellers to understand an effective price point and, by extension, trust the Realtor’s judgment.
Consumers have shown an increasing respect for statistics as a tool in decision-making. The Case-Schiller Index, for example, is widely reported by the media and has made Americans more sensitive to price indices.
“Using Florida Realtors’ Price Index will play to these attitudes and increase the perceived market expertise of the Realtor,” Tuccillo says.
For more information on Florida Realtors Residential Price Index, visit the research page on floridarealtors.org. Click the “Residential” box under “Research reports.”
© 2012 Florida Realtors®