When you see a news report talking about home prices changing, can you take the report at face value? In most cases, the answer is no. News reports about the state of a local or nationwide real estate market are often skewed. In many cases, reporters base their ‘conclusions’ on skewed data. If you’re going to rely on news reports to tell you about the activity in a real estate market, know what you’re seeing and what the reports actually mean. You can still get good data from these reports if you know how to read between the lines. 

Median Home Values can be Misleading

Most real estate activity reports are based on the median home values in a neighborhood. If median home values increase, news agencies often report appreciation in a neighborhood. If median home values go down, this can prompt reports of a slowing economy, home values dropping and other negative conclusions.

What most people don’t realize is that median home values indicate activity – not necessarily the conclusions that news sources draw. For example, in a down economy, there may be more activity on low-value homes. That doesn’t mean that home prices have gone down; it just means that homes in lower price ranges are selling more. A drop in median home values doesn’t always mean what the news sources say, so take their conclusions with a grain of salt.

Trust the Data – Not the Conclusions

Data can tell you a lot about a real estate market, but for a true indication of home values rising or falling, you must compare comparable properties. Median home values aren’t tied to comparable properties, so they can be misleading. If median home values in two-bedroom homes in a specific neighborhood are going down, it might be a sign that real estate prices are falling. Median home values without more specific data, however, are unreliable indicators. Look for more data to validate or invalidate what the news sources claim.

When you buy your new home, that triggers an entire round of solicitations from anyone whose products or services are even remotely associated with home ownership. These solicitations may take the form of services you’ve heard about, or think you need, offered by a third-party company. You might get solicitations for things like filing a homestead exemption, for example. In many cases, you can handle these things directly without paying a third party, and a homestead exemption is definitely one of the things you should handle yourself.  

What is a Homestead Exemption?

A homestead exemption is typically filed for tax purposes, although it can also prevent a forced sale or provide your spouse with shelter in the event of your death. A homestead exemption is a document stating that the home you’ve purchased is intended to be your primary residence. In some states, homestead protection is automatic and you don’t need to file paperwork to be eligible for protection. Some states only provide a property tax reduction, while in other states, the homestead exemption can prevent forced sales and provide other benefits.

You Don’t Need a Third-Party for a Homestead Exemption

Ignore the solicitations you get for a homestead exemption, or homestead protection. You don’t need to hire a third-party service to file the documentation for a homestead exemption. Check with your local tax commissioner or tax assessors office to determine whether your state requires you to file a homestead exemption, or whether you automatically qualify for this exemption.

In some cases, you’ll need to file a document with the recorder’s office, which may require a small filing fee like $25 or $50. You can file these documents yourself, without the aid of a third-party service, and pay nothing or pay only the small filing fee. Don’t pay someone else to fill out the form for you, when you can save money by doing it yourself. Keep that money to line your pocket and pay for the other expenses of being a homeowner.