The existing-home sales report is released on or near the 25th of each month. Behind the stats, you will find four important factors that help explain how existing-home sales are configured.
It is critical for the reader to understand that national statistics are gathered, usually, from the major metropolitan areas on the mainland, and thus relate only minimally if at all to the state of Hawaii and Kauai real estate.
Why existing-home sales are calculated on a seasonally adjusted annual rate. Seasonally adjusted annual rates are used in reporting existing-home sales data to factor seasonal variations in resale activity. For example, home sales volume is higher in the summer than in the winter, primarily because of differences in the weather and family-buying patterns in the U.S.
How seasonally adjusted annual sales rates are calculated. When calculating seasonally adjusted annual rates, the sales rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months.
Why median prices are compared with the same period a year earlier. Median prices in the existing-home sales report are not calculated on a month-to-month basis because seasonal changes and family-buying patterns in the composition of sales data can distort the median price. As a result, median price comparisons for existing-home sales are compared with the same period a year earlier. This is viewed as a more accurate and valid comparison of existing-home prices.
Why condo prices tend to be high. In a given market area, condos typically cost less than single-family homes. But in the existing-home sales report, condo prices tend to be high because there’s a concentration of condos in high-cost metro areas. In fact, the national median condo price — which excludes the concentration of condos in high-cost metro areas — is usually lower than the median single-family price. Relating to Kauai real estate, lenders are reluctant, and often refuse, to make mortgage loans on condos that contain time shares (even a small proportion), a front rental desk, or vacation rental units.
Courtesy of Doug Steiner, Prospect Mortgage 808 635 9536 on Kauai and added to by Tom Rice, RS, CENTURY 21 All Islands Kauai, to better inform the reader about the special status of Kauai real estate.