As a residential real estate appraiser, have you considered including charts or graphs in your reports? Creating valuable charts like histograms can enhance your market analysis and support your market value conclusions. In this post, we’ll look at histograms and how they can help appraisers. Then, we’ll break down step-by-step instructions on how to create a histogram in Excel.
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What is a histogram?
A histogram is a type of chart used for data analysis in Microsoft Excel. It shows the distribution of one variable, with the values of that variable split into specified ranges called bins. In real estate, histograms come in handy for analyzing variables such as lot size, property age, gross living area (GLA), and sale price.
How can histograms help appraisers?
A histogram is an excellent tool for analyzing residential real estate markets. Creating histograms in Excel can help appraisers not only analyze market trends, but also enhance their appraisal reports with visual data.
Appraisers can use histograms to:
- Analyze the characteristics of a local housing market to understand what’s typical within that market area
- Demonstrate the subject property’s position in the local market
- Help determine search criteria for comparable sales
- Reinforce their market value conclusions
- Visually enhance their appraisal reports, making them easier for the intended users to read and understand
Steps to create a histogram in Excel
Follow these steps to create a histogram chart in Microsoft Excel to visually analyze the distribution of data and enhance your market analysis:
- Open Excel: Open the Excel desktop application for Windows or Mac.
- Organize your data: Ensure your data is organized in a single column in Excel.
- Select your data: Highlight the cells containing the data you want to include in the histogram.
- Open the Insert tab: Click on the Insert tab on the Excel ribbon at the top of the screen.
- Generate histogram chart: In the Charts group, click on ‘Statistical’ charts and select ‘Histogram’ from the dropdown menu.
- Adjust the bin size: Excel will create a default histogram, but you may need to adjust the bin size to better fit your data. In Excel for Windows, right-click on the horizontal axis of the histogram, select ‘Format Axis,’ and adjust the bins according to your data. In Excel for Mac, right-click on the data series inside the chart (the bars in the histogram), select ‘Format Data Series,’ and adjust the bins under the ‘Options’ tab.
- Customize the chart: You can customize the chart further by adding axis titles, adjusting colors, and modifying other visual formatting elements to make the histogram clear and presentable.
Histogram example in real estate
Let’s use a histogram chart in Excel to visualize the number of homes that have sold in a specific price range. In this example, we are using the Excel for Mac desktop application.
First, we highlight the cells containing the selling prices for recent home sales in the local market area, which are listed in a single column.

Next, we open the ‘Insert’ tab, click the ‘Statistical’ chart icon, and choose ‘Histogram’ from the dropdown menu.

Now, we see the default histogram created by Excel.

Next, we can adjust the bin settings by right-clicking on one of the bars in the histogram and selecting ‘Format Data Series.’

In the Format Data Series panel on the right-hand side, we can change the ‘Number of bins’ or ‘Bin width’ to adjust the bin size.

Finally, we customize the chart by selecting a different ‘Chart Design’ option at the top and adjusting formatting options by right-clicking in different parts of the histogram (horizontal axis, plot area, chart title, etc.) and opening the ‘Format’ panel for that element.

In the screenshot above, we’ve double-clicked the ‘Chart Title’ and typed in a new name for the histogram. We’ve selected ‘Style 3’ from the ‘Chart Design’ tab. Finally, we’ve right-clicked the ‘Horizontal Axis’ in the histogram and selected ‘Format Axis’ to open the right-hand panel where we can adjust formatting settings.
Getting started with histograms in appraisal
Now that you know how to create a histogram in Excel, you can play around with building histograms for different types of data, such as gross living area (GLA), property age, and more, to analyze trends and show what’s typical or atypical within a particular market.
If you’re looking to visually enhance your appraisal reports and make them easier for your clients to read, histograms offer a simple solution. Histograms in Excel are an easy way to visualize data frequency so that you can demonstrate market trends and support your conclusions.
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