PS – Prices on each home have fallen more than 5%.
I agree 100%. However, this does not mean that the median is not a good barometer of the overall market. Ignoring a useful indicator like the median price (even with its flaws) could be just as dangerous as ignoring changes in inventory, changes in job creation, and net migration. After all, it was used extensively here to make arguments that we were in an unsustainable bubble.
Anyone who thinks the median is accurate would have to believe that most homes in San Diego have fallen 5% off their peak. I have to disagree 100% with this. We are intelligent enough to know that the median is the midpoint of all homes sold. We are also intelligent enough to know that it reflects both any changes in the mix of homes sold as well as price inflation/deflation. Those who have done their homework also know that it does not represent the change in price of any particular home, including our own, the one we rent, or the one we will some day purchase. It simply reflects the mid-point of homes that people are now purchasing.
