Well here’s something to stew over during your Sunday morning coffee…

What is a Median Home Price ? information at DoItYourself.com the Largest Online Home Improvement and Repair Center.

Changes in median price measure changes in market activity. When there are more buyers buying less expensive homes than there are buyers buying more expensive homes, the median price falls. Conversely, when there are more buyers buying more expensive homes than there are buyers buying less expensive homes, the median price rises.

The median price indicates which price range is most active. Not all price ranges experience the same market activity at any given time.

So, when you read that the median home price increased 6 percent in the last year, this doesn’t necessarily mean that your home increased 6 percent in value. It could have increased more or less in value. Likewise, if the median price were to drop 5 percent, this wouldn’t necessarily mean that home values dropped by 5 percent. In fact, they might have dropped more.

For example, in California, the median sale price of existing single family homes dropped from approximately $202,000 in May of 1989 to about $185,000 in April of 1994. But during that time, the actual market value of homes in some areas of Southern California dropped a whopping 40 percent.

So does that mean prices are falling really rapidly here?