Realtors create index

The Florida Association of Realtors announced it has created a home-price index that will track real estate transactions more accurately.

While the index now covers the entire state, the association says it will provide metro-area indexes and it is exploring the creation of commercial real estate indexes based on the same methodology.

To create the quarterly home-price index, the association takes data from county property appraisers as reported to the Florida Department of Revenue. The data tracks consecutive sales of specific properties, providing a more accurate measurement of value than median or average sales prices in an area.

For example, the rising median sales price may be because higher-quality homes are selling, not necessarily because the market is improving overall. Tracking individual properties provides a better idea of the value of housing, the association says. The index is similar to the S&P/Case-Shiller Home Price Indexes.

The association's newly created index currently covers the period from 1995 through August 2011. It shows that home prices rose 149% from 2000 to 2006 and fell 44% between mid-2006 to early 2009. Prices have stabilized since 2009.

Because of the one-year time lag from the Florida Department of Revenue, the association is working on tying current listing-service data from its members to the index to provide more up-to-date data.