Real estate: knowledge in hindsight.
What does that mean? Real estate is a thing of the past, meaning we can only analyze the past to hopefully predict the future.
All real estate data is relevant after the fact. Meaning, not until you close a sale or rental does it become actual knowledge.
Ex: your neighbor puts his house up for sale for $500,000 and you think ‘wow! prices have really gone up. I’m going to put my house for $550,000.’ When you speak with a realtor, he/she says the last closed sales are at $400,000. At that point you get upset and say why is my neighbor at $100,000 higher than that number? Well, when realtors are giving home valuations we need to analyze past data to quantify a new sale. These past sales that closed within the last 90 days is what creates the current market. We look at the interior and exterior of the homes and compare them to one another and make adjustments for differing factors. If the last sale at $400k is just as similar as the $500k then a $100k price hike will be unjustified and will value the same home at $400k (give or take a few thousand for property differences).
On the alternative, if the $400k home was a tear down and the $500k has been completely updated then YES, you have a valid price increase due to the costs incurred to update the house. If the $550k house is outdated and not well kept, then you can discard any possibilities of selling at a premium from the $400k.
You pay your property taxes in arrears. You receive your TRIM notice with a prediction of current, best & worst case values. Then taxed on majority vote the following year after you have consumed/occupied your residence and pay accordingly.
Your insurance is paid in advance. You receive a quote/estimate and pay before your use or need the insurance.