MARKET UPDATES
What do year-over-year market comparisons tell me?
By Steve Lockhart
The short answer
Housing is seasonal, so comparing this January to last December is comparing different seasons. Year over year compares a month to the same month a year earlier, which puts the two snapshots on the same part of the calendar.
Full answer
Housing is seasonal, so comparing this January to last December is comparing different seasons. Year over year compares a month to the same month a year earlier, which puts the two snapshots on the same part of the calendar. That is why analysts quote YoY changes.
A twelve month comparison also captures a full cycle of the market: a full round of seasons, holidays, and typical buyer patterns. When you hear that prices are up or down a certain amount, it is almost always a YoY number, because it is the most honest single comparison.
The same lens improves the story of inventory and pace. YoY inventory compares how much supply there is now versus a year ago, and YoY days on market shows whether homes are selling faster or slower than the same time last year. Both filter out calendar noise.
The limits are the same as any number: the comparison blends the whole market, and a year is a long time in real estate. YoY tells you the broad direction; your segment's recent months and current conditions tell you what is happening now.
A note from Steve: market conditions change every month, and numbers quoted anywhere can go stale quickly. The guidance on this page is meant to stay true across markets. For the latest Southern Nevada figures, check the Market Updates page or ask me directly, and I will read the current data through your situation.
Go a little deeper
Frequently asked
Questions people often follow up on
Why not just compare to last month?
Month to month includes season, which can move the median and sales count by itself. The month to month change is real momentum, but the YoY change is the fairer measure of direction, and reading both is the most complete picture.
What if this year and last year were very different markets?
Then the YoY number is still useful, but it should be read with that difference in mind: comparing a normal year to an unusually strong or weak one tells you about the swing, not just the current level.
The Lockhart Method
The Lockhart Method
Your Home | My Strategy | Proven Results
My strategy: I quote YoY for direction and month to month for momentum, then bring both down to your price range and neighborhood. Trends explain the market; your specific situation decides the move.
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