Question Details

Nick Papadak…, Home Buyer in Chamblee, GA

How you calculate Median sales price vs Average sales price.?

Asked by Nick Papadakis, Chamblee, GA Fri Oct 19, 2007

Help the community by answering this question:

Answers

4
Quick answer: Median price is half are below, half are above
Average price: All sold prices are added together into a sum;
the sum is then divided by the number of houses that sold.

An answer to an earlier Trulia Thread with the same question:

http://www.trulia.com/voices/Financing/Read_detail_seciton_b…

The big difference between the median and mean is illustrated in a simple example:

1. Suppose 19 workers and 1 billionaire are in a room. Everyone removes all money from their pockets and puts it on a table. Each worker puts $5 on the table; the billionaire puts $1 billion there.

The total is then $1,000,000,095. If that money is divided equally among the 20 people, each gets £50,000,004.75. That amount is the average amount of money that the 20 people brought into the room.

But the median amount is $5, since one may divide the group into two groups of 10 people each, and say that everyone in the first group brought in no more than $5, and each person in the second group brought in no less than £5. In a sense, the median is the amount that the typical person brought in. By contrast, the average is not at all typical, since nobody in the room brought in an amount approximating $50,000,004.75


http://en.wikipedia.org/wiki/Median
1 vote Thank Flag Link Sat Oct 20, 2007
Jim Walker, Real Estate Pro in Carmichael, CA
MVP'08
Contact
The median sales price is the price literally in the middle if you line up all prices from lowest to highest. So, for example, let's say you have the prices 1,1,2,2,2,3,4,5,5,6,10. If you look for the middle number in the line, that's your median. In this example, there are 11 numbers. The number right in the middle of the line is 3 (1,1,2,2,2 are to the left of this and 4,5,5,6,10 are to the right), so 3 is the median price. There's really no calculation in median price-it's just lining up the numbers and finding the middle.

With average, you add up all the numbers, divide that number by the amount of numbers in your sequence, and you get the average. In the example above, you take 1+1+2+2+2+3+4+5+5+6+10=41. Divide 41 by the amount of numbers in the sequence, which is 11 (41/11), which equals 3.73. So 3.73 is your average.
1 vote Thank Flag Link Fri Oct 19, 2007
By asking your to provide you with a CMA. If you have not hired a Realtor, check the last 6 months sales at the county court house.

Best of Luck
0 votes Thank Flag Link Thu Apr 18, 2013
please determine the average price between the two prices?

property 1 is 4950 000
property 2 is 60 000
0 votes Thank Flag Link Thu Apr 18, 2013
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer