Mild weather in November and December was beneficial
WALTHAM, Mass. – January 18, 2011 – The Massachusetts Association of REALTORS® (MAR) today announced that for the fifth straight month, REALTOR® confidence in the real estate market has gone up compared to the same time last year according to the December 2011 REALTOR® Market Index. The REALTOR® Price Index (RPI) in December was up from last year. Fifty-one percent of REALTORS® responded that the unseasonably warm weather in November and December had a positive impact on the market.
“While there was some market uncertainty in the year, it was good to see 2011 close with our members’ confidence going up for the fifth straight month,” said 2012 MAR President Trisha McCarthy, broker at Keller Williams Realty in Newburyport. “These indexes are a reflection of what REALTORS® are seeing and hearing from their clients on a day-to-day basis and their confidence level is moving in the right direction.”
In December 2012, the REALTOR® Market Index was 28.28, which was up 45 percent from the December 2010 score of 19.54. This is the fifth straight month of year-over-year increases since January-May 2010. On a month-to-month basis, the December RMI was up 12 percent from the 25.24 score in November 2011. Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.
The REALTOR® Price Index was 48.51 in December, which was up 2 percent from the December 2010 RPI of 47.70. On a month-to-month basis, the RPI was up 9.55 percent from the November 2011 RPI of 44.29.
REALTOR® members were asked in December about the impact that the unseasonably warm and dry weather in November and December had on the market. Fifty-one percent responded that the weather had a positive impact (47%) or significant impact (4%). Forty-eight percent reported there was no difference from past years, while only two-percent reported the warm weather had a significant negative impact. No REALTORS® who responded said there was just a negative impact from the weather.
The REALTOR® Market Index for 2011 was 43.66, which was down 8.9 percent from the 2010 RMI of 47.94. The REALTOR® Price Index was down 9.8 percent from the 2010 RPI (30.11 in 2010 to 27.13 in 2010).
About the REALTOR® Index Methodology:
The Massachusetts REALTOR® Market Index (RMI) and Price Index (RPI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
1. How would you describe the current housing market?
2. What are your expectations of home prices over the next year?
In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
The RMI is calculated in the following way. Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points). The results are the average score for each question. A score of 50 is the threshold between a “strong” and a “weak” condition. Similarly, the question about home prices over the next year (REALTOR® Price Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).
About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000 members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.
Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.