Welcome to 'Yo-yo Land'

Different real estate market reports can show home prices up, down and all around. Here’s how to cut through the clutter and figure out which ones are meaningful to you.

August 2, 2013

If you’re like most real estate professionals, you’ve been confused at one time or another by real estate market reports that seem contradictory or that just make no sense when compared to what you’re experiencing in your market.

When one report has home sales up and another has something different, which is right? If prices are soft where you live, but all the national reports in the news have prices zooming, what do you tell your sellers when they want to price their homes too aggressively?

News coverage of national reports sets your clients’ and customers’ expectations. Reports that confuse them can make life miserable. There are dozens of different “national” market reports today, and all are done in different ways, at different times, covering different markets, comparing different time intervals, and using different definitions of sale, time-on-market, and inventory. Cutting through the clutter and understanding which reports are reliable and useful is important.

Once, I tried to help a friend understand these complexities, and we were communicating via e-mail. I was in the process of explaining that the seasonality of the real estate business makes it important to compare today’s real estate prices to prices at the same time a year ago, called year-over-year. I used the shorthand “y-o-y.”

“So it’s like a yo-yo,” he replied. “Now I get it. Things go up and down or all around, and return to where they started. We’re talking Yo-yo Land.”

So, welcome to Yo-yo Land, where the rules may seem strange at first. But once you know the basics, you can understand how to use the wealth of real estate market information to make more informed decisions and successfully counsel others.

Here are some basics to help you get started.

1.      Different kinds of data create different results.

Just like baking a cake, what goes into a report determines what comes out. Real estate market reports use four different kinds of data: listings data from MLSs; public data from actual transactions filed in courthouses; appraisal data from software platforms maintained by mortgage servicers and appraisal management companies; and surveys of real estate professionals or consumers. Each kind of data has strengths and weaknesses. Here’s a summary:

Data Type





Timely, local, accurate inventories

Asking prices only, usually high

Trulia, realtor.com®, NAR


Very accurate and complete

Slow (2-4 months)

Case-Shiller, FHFA



Slower than listing data

Lender Processing Services, CoreLogic



Least accurate

HousingPulse, RE/MAX


Most accurate, fast


Clear Capital


2.      Check the report’s time period and the markets it covers.

Nothing’s more frustrating than to compare the latest data from your MLS to the latest Case-Shiller release. First, Case-Shiller uses public data, and the quarterly report is released two-and-a-half months after the period it is reporting. Second, Case-Shiller consists of two different indexes derived from 30 and 40 market groupings, largely major cities. If you’re not in one of those markets, the findings don’t relate to you at all. Other very slow reports are the government’s FHFA report and FNC.

3.       Look first to your MLS.

One of the great ironies in real estate is that, although all real estate is local, it’s much easier to get market information about the nonexistent national market than your local market. Filling that huge local void today are multiple listing services. Most MLSs provide their members with market reports that break down data by municipality, county, or ZIP code. There is no better source of market information for most REALTORS®.

In addition to MLSs, many markets are home to consulting real estate economists who report on local markets. Also, many leading graduate schools of real estate conduct market research. (Here’s a good list.) If you live near one, you might give them a call.

However, as noted on the table above, listings data have their shortcomings, chiefly with prices. Listing prices represent only one side of the transaction: the sellers. Generally, list prices are as much as 5 percent above the final prices, but that can vary. In a seller’s market, list prices are closer to the final number, but I imagine that as a REALTOR®, you have a good handle on that.

4.       There is no such thing as the last word or a perfect report.

You might encounter two separate reports on your market. Each covers the same time period and uses the same kind of data, yet the results differ. Why?

The fact is that no report is the final word. Differences in the exact time period the data covers, the exact geography, the variables that were measured, the algorithms the statistician used to weight the data, etc., can all produce differences in reports. Look to see how each report was conducted and note the differences. Decide which best fits your needs and your market. Just as a doctor uses more than one test to decide on a diagnosis, consider the reports together to get a balanced picture.

Steve Cook is co-publisher and managing editor of Real Estate Economy Watch, which was recognized as one of the two best real estate news sites of 2011 by the National Association of Real Estate Editors.  Previously, he was vice president of public affairs for the National Association of REALTORS®.  Twice he has been named one of the 100 most influential people in real estate.