Correlation

Definition of "Correlation"

Degree of relationship between variables or factors affecting the real estate market and activities within the market. Correlation examines how the value of one variable changes when the value of another variable changes (e.g., interest rates, money supply). A prediction can be made based on the relationship. A degree of correlation is measured mathematically by the coefficient of determination (r-squared). The correlation between variables may range between +1 to - 1. Perfect positive correlations +1. perfect negative correlation is -1. No correlation between variables is indicated by 0.

Search Real Estate Glossary

Related Real Estate Glossary terms

Recapture Rate

Annual return rate of capital invested in a wasting asset. The capital is returned from the depreci ...

Mortgage Pool

A collection of packaged residential mortgage loans for sale in the secondary mortgage market to inv ...

Empirical Consideration

Loading to the burning cost ratio for a reinsurer's expenses, profit, and to build a reserve to meet ...

Primary Lease

Rental agreement directly between the landlord and tenant. If the tenant then rents it out to anothe ...

Carrier

Insurance company that actually underwrites and issues the insurance policy. The term is used becaus ...

Peak Season Endorsement

Endorsement attached to property insurance coverage that provides additional limits of protection on ...

Related Real Estate FAQ

What Is A Subdivision?

A subdivision is a piece of land divided into several plots in which homes are built. ...

What Is A Wraparound Mortgage?

A wraparound mortgage is a new mortgage that includes the remaining balance on an old mortgage, plus ...

What Is A Convertible ARM?

A convertible ARM is an adjustable- rate mortgage (ARM) that can be converted into a fixed rate mort ...

How Much Income Do I Need ?

Mortgage companies use ratios to analyze your mortgage payment. The housing payment ratio (or front ...

What Is A REALTOR®?

A REALTOR® is an agent or agency that belongs to the local or state board of REALTORS® and is affi ...

What Is A APR Loan?

This APR Calculator can be used to estimate the Annual Percentage Rate for a loan based on input par ...

Read why Real Estate Agent rates 5 Stars in 10 Agent Reviews

Agents join here

Add our widget on your Website

Real Estate Advice

How Does The Home Loan Underwriting Process Work? Top Five Reasons Your Home Offer was Rejected Tax Breaks for the First Time Home Buyer How is Square Footage Determined? Getting Ready to Sell? Don't make these DIY Mistakes!

FAQ

Who is a subagent? What is homeowners insurance? How Much Will My Principal Be? What do I need to know about Watercraft Insurance? What is a qualifying ratio?