{"id":63455,"date":"2018-07-31T12:53:18","date_gmt":"2018-07-31T19:53:18","guid":{"rendered":"https:\/\/redfindevelop.wpengine.com\/blog\/?p=63455"},"modified":"2020-10-06T17:08:04","modified_gmt":"2020-10-07T00:08:04","slug":"redfin-housing-demand-index-methodology","status":"publish","type":"post","link":"https:\/\/www.redfin.com\/news\/redfin-housing-demand-index-methodology\/","title":{"rendered":"Redfin Housing Demand Index Methodology"},"content":{"rendered":"<p><b>The Redfin Housing Demand Index<\/b><span style=\"font-weight: 400;\"> is the industry\u2019s first and only measure of housing activity prior to purchase. It is based on thousands of Redfin customers requesting home tours and writing offers in 15 major metro areas. The Demand Index is \u00a0seasonally adjusted, with 100 representing the baseline level of homebuyer demand posted in January 2014. All periods thereafter can be compared to one another in a relative sense. For example, a Demand Index reading of 116 in January 2015 implies that homebuyer demand in that month was 16 percent higher than it was in January 2014. Similarly, a level of 120 in June 2018 means that demand was 20 percent higher than it was in January 2014, and roughly 3 percent higher than in January 2015.<\/span><\/p>\n<h3><i><span style=\"font-weight: 400;\">Demand Index Timing<\/span><\/i><\/h3>\n<p><span style=\"font-weight: 400;\">Redfin will publish its Demand Index on the last Tuesday of each month at 8 a.m. Eastern time. \u00a0The Demand Index will use available information at the time it\u2019s run (the middle of the following month), but due to the smaller sample sizes and variable reporting times from different Metros, the latest Demand Index value for each Metro may be revised on the subsequent release.<\/span><\/p>\n<h3><i><span style=\"font-weight: 400;\">Why Redfin<\/span><\/i><\/h3>\n<p><span style=\"font-weight: 400;\">Redfin is the only U.S. real estate brokerage that can track every tour and offer at scale because its agents are employees of the company who all use the same technology platform to track their work and client activity.<\/span><\/p>\n<h3><i><span style=\"font-weight: 400;\">Details and Methodology<\/span><\/i><\/h3>\n<p><span style=\"font-weight: 400;\">Tours are weighted by averaging the number of tours per written offer. The index adjusts for Redfin market share growth by taking the raw number of tours and offers in a given month and dividing by an exponentially weighted sum of Redfin\u2019s share of sales over the prior six months. Sales activity outside of the portions of the market in which Redfin operates are accounted for by assuming demand follows a lognormal distribution with respect to price. The undersampled parts of the distribution are filled in using Redfin\u2019s offer and tour information from the well sampled portions, and utilizing a maximum likelihood estimation approach to calculate the parameters of the whole lognormal distribution. This allows us to calculate the shape of the entire demand distribution using our available tour and offer data. Finally, we employ a statistical technique to estimate and remove statistical noise and the predictable seasonal patterns in the data to arrive at a seasonally-adjusted demand series.<\/span><br \/>\n<span style=\"font-weight: 400;\">15 Metro Areas: Atlanta, GA; Austin, TX; Baltimore, MD; Boston, MA; Chicago, IL; Denver, CO; Los Angeles, CA; Oakland, CA; Orange County, CA; Phoenix, AZ; Portland, OR; San Diego, CA; San Francisco, CA; Seattle, WA, Washington, D.C.<\/span><br \/>\n<b>About Redfin <\/b><br \/>\n<span style=\"font-weight: 400;\">Redfin (<\/span><a href=\"https:\/\/redfin.com\/blog\/\"><span style=\"font-weight: 400;\">redfindevelop.wpengine.com<\/span><\/a><span style=\"font-weight: 400;\">) is the next-generation real estate brokerage, combining its own full-service agents with modern technology to redefine real estate in the consumer&#8217;s favor. Founded by software engineers, Redfin has the country&#8217;s #1 brokerage website and offers a host of online tools to consumers, including the<\/span><a href=\"https:\/\/redfin.com\/blog\/redfin-estimate\"> <span style=\"font-weight: 400;\">Redfin Estimate<\/span><\/a><span style=\"font-weight: 400;\">, the automated home-value estimate with the industry&#8217;s lowest published error rate for listed homes. Homebuyers and sellers enjoy a full-service, technology-powered experience from Redfin real estate agents, while saving thousands in commissions. Redfin serves more than 80 major metro areas across the U.S. The company has closed more than $60 billion in home sales.<\/span><br \/>\n<span style=\"font-weight: 400;\">For more information or to contact a local Redfin real estate agent, visit <\/span><a href=\"https:\/\/redfin.com\/blog\/\"><span style=\"font-weight: 400;\">redfindevelop.wpengine.com<\/span><\/a><span style=\"font-weight: 400;\">. To learn about housing market trends and download data, visit the <\/span><a href=\"https:\/\/redfin.com\/blog\/data-center\"><span style=\"font-weight: 400;\">Redfin Data Center<\/span><\/a><span style=\"font-weight: 400;\">. To be added to Redfin&#8217;s press release distribution list, <\/span><a href=\"http:\/\/cts.businesswire.com\/ct\/CT?id=smartlink&amp;url=https%3A%2F%2Fdocs.google.com%2Fa%2Fredfin.com%2Fforms%2Fd%2F1jJ5IKWDu53fVqnWKPK9TluwRznAASm9Pbe2fwSMfGOU%2Fviewform&amp;esheet=51496874&amp;newsitemid=20170120005068&amp;lan=en-US&amp;anchor=subscribe+here.&amp;index=13&amp;md5=1095bec31d2e5c23b2e034d9ee20381a\"><span style=\"font-weight: 400;\">subscribe here.<\/span><\/a><span style=\"font-weight: 400;\"> To view Redfin&#8217;s press center, <\/span><a href=\"http:\/\/press.redfin.com\/phoenix.zhtml?c=252734&amp;p=irol-overview\"><span style=\"font-weight: 400;\">click here<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">For further information<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Redfin Journalist Services<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Phone: 206-588-6863<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Email: press@redfin.com<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Redfin Housing Demand Index is the industry\u2019s first and only measure of housing activity prior to purchase. It is based on thousands of Redfin customers requesting home tours and writing offers in 15 major metro areas. The Demand Index is \u00a0seasonally adjusted, with 100 representing the baseline level of homebuyer demand posted in January [&hellip;]<\/p>\n","protected":false},"author":13481,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[8],"tags":[67],"coauthors":[],"class_list":["post-63455","post","type-post","status-publish","format-standard","hentry","category-housing-market-news","tag-demand-index"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.7 (Yoast SEO v27.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Redfin Housing Demand Index Methodology - Redfin Real Estate News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.redfin.com\/news\/redfin-housing-demand-index-methodology\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Redfin Housing Demand Index Methodology\" \/>\n<meta property=\"og:description\" content=\"The Redfin Housing Demand Index is the industry\u2019s first and only measure of housing activity prior to purchase. 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