As market indicators, real estate indices are a useful instrument in real estate valuation because they illustrate the current development of property prices
in a specific city or community. Various providers (such as regional building societies or real estate industry associations) analyse market data and publish it in a real estate index.
These are mean values from regional property sales, which make it easier to understand the market.
Not only are these reports used by estate agents as a guide, they can also provide interested parties with information about rent and buying prices.
An advantage is that the reports also illustrate trends in addition to the latest data, making it possible to predict market developments.
However, the valuation should not be made on the basis of these documents alone, as the stated regional mean values are not applicable to all properties.
Specific aspects such as the condition and location of the building play an important part in a real estate valuation.
This is why an individual analysis of the property in question is always necessary.