# Median

#### Median Vs Average Values in Real Estate

Median values show a more accurate view of the market since they are typically less affected by large variations in the data. For example, let’s assume that the project you are looking at includes 5 properties, as shown below along with their respective transacted prices.

Property #1 … \$350,000
Property #2 … \$370,000
Property #3 … \$310,000
Property #4 … \$1,200,000
Property #5 … \$335,000

The first thing you might notice is that one of the prices is not like the others. Property #4 is priced much higher than the rest. This will have a significant affect on the average value, which happens to be \$513,000. (sum all prices and divide by total transactions)

To determine the median, we first sort the list in ascending order, then pick the middle value, which is \$350,000. See below:

Property #3 … \$310,000

Property #5 … \$335,000

Property #1 … \$350,000
Property #2 … \$370,000
Property #4 … \$1,200,000

Comparing it to the average, the median value is a much more realistic interpretation of this market.