Home Values Rise Even as Median Prices Fall

 
Recent headlines are buzzing about how the median asking price of homes is lower than last year, and that’s causing some confusion. As a buyer or seller, it’s easy to assume that means home prices are dropping, but here’s the thing—the numbers don’t tell the full story.

Nationally, home values are actually rising, even if the median price is down a bit. So, let’s break this down so you can understand what’s really going on without getting caught up in all the media noise.

Homes on the Market Right Now Are Smaller

The main reason for the dip in the median price is the size of homes currently for sale. The median price represents the middle point of all listed homes, and that’s influenced by the mix of homes on the market at any given time.

Here’s an easy way to explain it. Imagine you have three coins: one nickel and two dimes. If you line them up, the median value is 10 cents. But if you have two nickels and one dime, the median value becomes five cents. The value of each coin didn’t change—it’s just the mix that’s different.

Right now, we’re seeing more smaller, less expensive homes on the market, and that’s pulling the overall median price down. But that doesn’t mean home values are declining.

As Danielle Hale, Chief Economist at Realtor.com, puts it:

“The share of inventory of smaller and more affordable homes has grown, which helps hold down the median price even as per-square-foot prices grow further.”

In other words, the price per square foot is what really tells the story.

Price Per Square Foot Is Still Rising

A more reliable way to measure home values is by looking at the price per square foot. This shows how much buyers are paying for space in the home, regardless of its size.

While the median asking price might drop due to more smaller homes being listed, the price per square foot data reveals that home values are still climbing. Ralph McLaughlin, Senior Economist at Realtor.com, explains:

“When a change in the mix of inventory toward smaller homes is accounted for, the typical home listed this year has increased in asking price compared with last year.”

This means that even though smaller homes are skewing the median price, the average value of a home is still on the rise.

Home Appreciation Remains Strong

According to the Federal Housing Finance Agency (FHFA), home values have been appreciating steadily since 2012. So, while the headlines might make it seem like home prices are crashing, that’s not the case. Values are still going up nationally, just at a more moderate pace.

But remember, real estate is local. While national trends provide a broad view, your local market might tell a different story. That’s where a trusted real estate agent comes in—someone who can give you up-to-date insights on what’s happening in your area.

Bottom Line

The decrease in the median price you’re hearing about is not the same as a decrease in home values. It’s mostly due to more smaller, affordable homes hitting the market. The key thing to pay attention to is price per square foot, which gives you a better sense of overall value—and those prices are still climbing.

If you have questions about home prices in our area or want to know how your home fits into the market, reach out. I’m here to help you navigate the market with clarity and confidence! realtor, best agent, real estate, Southlake, Keller, Haslet, home buyer, home seller, home value, Trophy Club, Fort Worth, new home, house, home selling, seller tips, 4wheeltorhomes, 4wheeltor, Crystal Zschirnt, Westlake, Roanoke, Justin, Northlake, Flower Mound, Argyle, Texas

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