Both the average and median price are down 9% from the peak.

Avg: $355K vs $324K
Med: $302K vs $275K

IMO, the buyers are not “average” either.

But really, you are comical that you don’t know about how REALTOR commissions is related to all of this. So many of your comrades suggest that the commission structure ensures that a good job is done–a higher total earned commission for a higher sales price. With total commissions going down, what environment does that create for future sales?

The funniest part is the idea that average prices somehow are related to how much an average seller could sell for. With 11 months of inventory, the average seller isn’t selling in today’s market.

We can only hope for better times in the future, but I don’t see too much good in the numbers that continue to be published.

I don’t know what Realtor commissions have to do with all this, but, no, I don’t think average selling prices matter with such a small sample size.

Did you notice that the change in closed sales is larger than the increase in average price? This is driving the total sales volume down (total sales volume = quantity of closed sales * average selling price), which is what REALTOR commissions are based. October 2007 total sales volume was about $637M. For October 2008 the total sales volume was about $475M, or about 75% of $637M. In other words, if it is fair to assume that the weighted average commission did not change in percentage terms, then the total REALTOR commissions took a 25% cut.

Also while the average price was lower in September 2008, at about $517M, the total sales volume was greater.

Total sales volume is going down in large part because sales are approaching zero. That’s what’s driving the inventory in months so high.

As pointed out, the pending quantity of sales is very low. My guess is that the total sales volume will be about $350M for November.

Do average selling prices really matter as the number of sales approach zero?