Median Sales Price vs. Average Sales Price - What is the Difference?
The Median Sales Price, when talking about real estates sales, is generally more accurate than the Average Sales Price. Here's what it means:
The Average Sales Price is the sum of the total dollar volume divided by the total units sold. The Median Sales Price is the sales price at which half of all sales are above and half of all sales are below. It's helpful to think of it as the "mid-point." The Median Sales Price is often a better indication of the market than the Average Sales Price, especially when a few sales may distort the Average Sales Price.
Here's an example: Ten houses are sold in an area. One sold for $1,000,000 and nine sold for $250,000. The Average Sales Price would be $325,000 and the Median Sales Price would be $250,000.
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