There are many sources of data relating to the housing marketplace. There are national and local indicators that measure new housing starts, existing home sales unit count, average sales price, average time on the market, etc. Each piece of information is valuable in evaluating the market if taken in context and considered with respect to all of the other available statistics. What is, in our opinion, lacking is a single indicator of market strength and specifically an indicator that characterizes our local southeast Nebraska markets. For some time we at WeSellNebraska have been collecting and evaluating data on local markets, specially Lincoln and Omaha and have sought a way to present a snapshot of market conditions that would be valuable to both buyers and sellers.
Towards that end we offer the WSN Housing Index which is based on six plus years of sales data collected on a monthly basis. The WSN Housing Index tracks three subsets of the existing housing marketplace in both Omaha and Lincoln for a total of six index measurements. Specifically we track sales of existing single family homes from five to fifty-five years of age with level “I” being those properties with 1250 square feet or less of above grade living area, level “II” includes those properties with between 1250 and 2250 square feet of above grade living area, and finally, level “III” being those properties with more than 2250 square feet of above grade living area. For levels “I” and “II” we filter for properties with lot sizes up to one acre and for level “III” lot sizes up to five acres. We do not, track at this time, new and nearly new construction i.e. properties less than five years of age, nor do we track condominium or town home sales. We consider all sales within the respective MLS systems thus including sales in outlying areas with sales in the core areas of Lincoln and Omaha. Our goal is not to predict the value or potential sales price of any particular property or property type but rather to provide a realistic sense of market strength that can be particularly beneficial when setting expectations.
The market index is set using the twelve months ending December 31, 2005 a the base line. For each level and for each market the 2005 average sales price and sales volume establishes the base line index of 1000. Everything else is measured against the baseline i.e. an index of 900 for any respective time period suggests a market 90% as strong as the baseline period. Likewise an index of 1100 suggests a market 10% stronger than the baseline period. This absolute index provides us with a very convenient and visual way of tracking market trends and variances. Hopefully you will find the monthly WSN Housing Index to be a valuable tool.