"How's the market?" This is a question I am asked repeatedly. As an agent, an important part of my job is to interpret the market.

If, as a buyer or seller, you do not understand what is happening in the market, you will be operating from a weakened position. Information is power. The market constantly changes to some degree. The exact direction of these changes is often difficult to discern immediately. Today we can say that our market peaked toward the end of 1989, but, back then, it was not so clear.

So, how is the market today? The answer depends on how you want to define it. One way to do so is to refer to industry statistics. This approach is somewhat useful, but limited. Statistics in newspapers or on TV are generally a few months old and are usually broad-based. More specific, current data are available from the Multiple Listing Service and from computer subscription programs, such as Metroscan, found at well-equipped brokerages and title companies. Even this "hard copy" data can be evaluated only after looking at other factors.

Computer-collected data will show trends in a given area which may not necessarily be applicable to your neighborhood, street or property. There are pockets in some neighborhoods which traditionally sell for more than the surrounding area; there are also sections within neighborhoods which sell for less. Pricing can be tricky.

Another factor - certain price ranges might be active at any given time while others are not. For example, the $300,000 to $400,000 range can be slow in Oakland while the same range is quite lively in Lafayette. In a lethargic market, the lower end tends to be the most active because it is the most affordable. But, what is considered low in one area may be the higher end someplace else. The East Bay is not a homogeneous market.

Real estate agents must rely on both numbers and their personal experience along with that of others. Realtors share information with colleagues in their office, other real estate offices, title and escrow representatives, lenders, reps from home protection plans, pest control operators and home inspectors. Combining this with computer statistics gives us a better view of market trends in the immediate present, refined to a given area.

By assessing both numbers and input from others in the industry, it appears that the first four months of 1995 have been slower than last year in most of the East Bay. Bear in mind that real estate sales are seasonal and the winter months are consistently more sluggish than spring and summer. Regardless, if Realtors find it a challenge to understand the marker, how much more difficult must it be for those who are not full-time professionals?

A buyer who does not comprehend what is happening in a particular market may make the mistake of choosing to wait until prices drop further, when they have already reached their lowest point — in that market. For this buyer, this decision translates into lost opportunities, lost tax benefits, and lost "quality of life." Or, it may just mean this buyer is not really a buyer.

The converse is also true. In the midst of a market buying frenzy, homes may be bought well above their true market value. A buyer lacking the comprehension of such a market is more likely to end up owning an overvalued property. A buyer who has interpreted the market correctly, and has held his emotions in check, has a much better chance of getting the most value for his dollar.

A seller who misjudges a market may overprice his home (it is rare for a home to be underpriced). The seller who says, "I need 'x' amount for my house and will not sell it for less," probably does not even care about market trends, nor does he have a compelling reason to sell. Such a seller may not have a set time frame for selling and can afford to wait. It is the seller who is serious about selling, or must sell within a given period of time, who stands to lose the most by misinterpreting the market. In trying to maximize his return, a seller may start at a higher list price than his agent has recommended, saying "Bring me an offer, and then we'll talk about the price." Sad to say, the great majority of seriously overpriced listings do not even get an offer. There are so many other, reasonably priced, homes to choose from — homes listed by sellers who did listen to both the market and their agent. Beware of anyone, agent or not, who quickly tells you "what you can get" for your home.

How can you ensure you have enough information to make an informed decision? Work with an agent who is professional, experienced and knowledgeable in the neighborhood in which you are interested. Whether you are a buyer or seller, ask your agent to provide you with comparable sales, current listings and withdrawn and expired listings for that area. The withdrawns and expireds will give you an idea of asking prices and what did not sell. Current listings indicate what sellers are asking now. Drive by as many as you can in each category. Go to open houses to see what is presently on the market. Ask your agent to show you comparable properties.

After doing ail this, which will take time, you will have some of your own thoughts on pricing. At this point, you can compare what you think to your agent's opinion. You will become clear that the process of pricing is anything but scientific. It is "feel" and experience based on information.

In a market that is never static for very long, it is mandatory for buyers and sellers to have a good overview. It is also critical to put the current market in the perspective of past market trends. The difference between you knowing and not knowing the reality of the marketplace could be thousands, or maybe tens of thousands, of dollars in your pocket.