Market Trends: Methodology and Definitions

Quick Links to Data Set Definitions

• Snapshot Definitions
• Days on Market
• Market Activity
• Market Inventory
• Price per Square Foot / Acre
• Pricing Ratios
• Pricing Trends
• Showings
• Supply & Demand

Market Trends: Methodology & Data Calculations

Point in Time vs Period of Time Metrics

When we think about the stock market, we can consider a metric like stock price to be a “point in time” metric. If I ask you about a company’s historical stock price, I must specify the date and time that I want the price for. By comparison, we consider a financial metric like income to be an “over a period in time” metric. If I ask you about a company’s historical income, I must specify the period (all of Q1 2024 or all of 2025).

In the real estate market, some metrics are “Point In Time”

• Inventory

• Months Supply

• Avg Price (of all homes available right now)

Other metrics are “Period of Time” metrics:

• Activity (Number of New Listings, for example)

• Avg Sales Price (for all home sold in a period)

For Market Trends, we show statistics for a whole month-- not any specific time in that month. Therefore, every metric must be over a “Period of Time”. To accomplish this, we take all “point in time” metrics and convert them to “period of time” metrics by calculating an average over the the period. For example, if there was 1 home listing for sale in 37027 and it was “Active” for every day in the month of July, then the Inventory is obviously 1. However, if there was only 1 home listing for sale in 37027 and it was only active for first 1/2 the month of July, then then Inventory is only 0.5. If there was a 2nd home for sale in the zip code and it was only active for the second 1/2 of the month of July, then the Inventory for the zip code would be 1 again.

NOTE: There are many analytic products in the industry, all of which yield slightly different results. This is because they are calculating "point in time" metrics at different times.  Because we have access to all the data, Realtracs is uniquely positioned to evaluate the data throughout the entire period and calculate weighted averages accordingly.
Similarly, other tools only calculate stats for a month once-- often before all the data is available.  By contrast, we our calculations are kept up to date as additional closings for the prior month are entered throughout following days and weeks.

Search Stats vs Market Trends

We are often asked why one cannot easily replicate the Market Trends metrics with search results (specifically when using the “stats” feature of our search product).

The “stats” tab for search shows you statistics about the listings in your search results. For example, if you search for all active listings in Zip Code 37027, you can see the average price of the listings returned. This feature is intended to help agents calculate statistics for a specific set of properties (such as comparables for a listing presentation or purchase offer). The results show you the statistics for a set of properties as of right now. And it does not take into account price changes that have occurred on those properties over a given month (or any period of time).

By comparison, Market Trends shows you the statistics about a market over a period of time. For example, I CANNOT ask Market Trends what the average price is for listings in 37027, but I can ask “What is the weighted average price for listings that have been on the market during the month of October in Zip Code 37027”. The “weight” in this scenario is the number of days the listing was on the market during the month. This is how we convert “point in time” metrics to “period of time” metrics (see above).

It’s also worth noting that the condominium market and single family markets trend very differently. Therefore, our Market Trend product makes it easy to separate them out. When comparing search results with MarketTrends, the following Property SubTypes are considered “Condominium”:

• Townhouse

• Flat Condo

• Garden Condo

• Highrise Condo

• Loft Condo

• Other Condo

It’s also worth noting that HPR-Attached and Zero Lot Line-Attached are considered “Single Family” and are not included in Condominium statistics despite being “attached” property types.

Last, our market trends product includes “Office Exclusive” listings. However, you won’t be able to see exclusives for offices other than your own in our search product.

Notwithstanding office exclusives, with this knowledge you should be able to replicate the following stats with carefully crafted searches:

• ✅ Activity: Closings, Cancelled, Expired

  • ⚠️ New Listings is difficult to calculate in search because List Date can be backdated

  • ❌ Under Contract cannot be calculated using search because it is not possible to search on Binding Contract Date

• ❌ Inventory: None of these can be easily calculated with Search as Market Trends takes a weighted average of daily inventory (see calculations below).

• ✅ Days on Market: These metrics can be replicated for closed properties. 

• ✅ Pricing Trends: These metrics can be replicated for closed properties. (Avg Sale and Med Sale)

• ✅ Pricing Ratios: These metrics can be replicated. 

• ✅ Price per Sqft and Acre: These metrics can be replicated for closed properties. 

• ❌ Showings: For privacy purposes, this data is only available in MarketTrends

Set up your search criteria as follows:

• Location Criteria – Should match exactly your criteria in Market Trends

• Property Class – Should match exactly your criteria in Market Trends

  • If you select “Residential Single Family” in Market trends then also select all of Detached Property types in Search plus “HPR-Attached” and “Zero Lot Line - Attached”.

  • If you select “Residential Condo” in Market trends then also select the following from Property Type: Townhouse, Flat Condo, Garden Condo, Highrise Condo, Loft Condo, Other Condo

Calculation Types

Monthly

By default, all calculations are done over a period of time of 1 month, and we show results for the last year. When viewing metrics over the past year, we always include an extra month so you can compare the most recent month end with the same month end from a year prior. For example, if is Oct of 2025, we would show Sept 2024 through Sept 2025.

3-Month Rolling, 6-Month Rolling, 12-Month Rolling

Each period is defined by a period end (the date the period ended) and the period duration. For a monthly period, the duration is the entire month. So for September, the period goes from September 1st through September 30th.

For 3 month rolling calculations for September, the period still ends on Sep 30th, but would begin on July 1st.

Likewise, for 6 month, the period would begin on April 1st, and for 12 month, the period would begin on Oct 1 of the prior year.

The purpose of these rolling calculations is to smooth out seasonal fluctuations. Inventory tends to increase in the spring and transaction volume follows. The winter months are slower in Real Estate. Therefore, comparing November statistics to Aug statistics doesn’t make much sense. However, if we take a 12 month rolling average, then those seasonal fluctuations no longer impact our analysis.

Timeliness vs Accuracy

We aim for our Market Trends data to be both timely and accurate. But there is a tradeoff between the two.

As soon as a month ends we make metrics available for that month. Therefore, we aim to give you metrics for September by Oct 1st. This helps us achieve our timeliness mandate. However, as many agents are aware, it can take a few days before the listing is closed out in the MLS. Therefore, the results you get for September on Oct 1st and likely to be inaccurate by Oct 5th.

Calculating the market trend statistics is quite computationally costly. Therefore, we cache the results. Once someone runs the stats for a ZipCode, we cache the results so that we don’t have to recompute them when someone else wants the same stats for the same ZipCode.

Because stats can change so quickly at the beginning of the month, we only cache results for 1 day for recently completed months (the first 15 days of the month). By throwing away our cached results after 1 day, we help achieve our accuracy mandate.

If the period ended more than 15 days ago but still ended in the last year, we cache the results for up to 1 month. For periods more than 1 year ago, we cache the results permanently.

Market Trends Timeline: Days on Market Definitions

These metrics tell us how long it takes for a listing to progress through the various listing statuses.

NOTE: One might expect the “List to Close” values to be equal to the “List to Contract” values plus the “Contract to Close” values. However, they rarely will because the “List To Contract” values include listings that have gone under contract but not yet closed. 

Timeline: Market Activity Definitions

These metrics tell us what activity has occurred during a period of time.

You can validate these metrics by running a search by Listing Status and specifying a date range for a whole month with two caveats:

• In some counties (further away from Middle Tennessee), we may not ave all the inventory in the market. For example, in Monteagle, some listings appear in Realtracs and other listings appear in the Chattanooga MLS. If we aren’t confident that we will have a comprehensive set of listings for a county, we will not calculate statistics for that county.

• Our market trends product includes “Office Exclusive” listings. However, you won’t be able to see exclusives for offices other than your own in our search product.

Market Trends Snapshot: Metric Definitions