VIC Melbourne Dwelling Prices Record First Monthly Fall

Discussion in 'Where to Buy' started by standtall, 13th Dec, 2016.

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  1. standtall

    standtall Well-Known Member

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    I am not sure if this has been posted but Corelogic monthly indices for November are now available on their site and Melbourne dwelling prices dropped both across houses (-1.33%) and units (-3.20%) for the month of November. These drops are significant and December data would be very interesting.

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  2. Propertunity

    Propertunity Well-Known Member

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    I'm not sure that significant is the right word to describe a 1 month movement in price of barely more than 1%.
     
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  3. Gockie

    Gockie Life is good ☺️ Premium Member

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    1.1m median for houses in Sydney in Nov 2016?
    Gooooo Sydney :)
     
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  4. standtall

    standtall Well-Known Member

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    100% statistically significant as it takes into account a sample of thousands of dwellings. These numbers are actually 100,000x more reliable than looking at auction clearance rates.

    Even daily indices are fairly robust but taking a sum a 30 days in a row makes it statistically very strong.
     
  5. urbanista

    urbanista Member

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    There is no such thing as "100% statistically significant".
     
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  6. standtall

    standtall Well-Known Member

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    In simpler terms, these numbers aren't elections polls but rather are the actual election result.

    Average Melbourne dwelling did fall 1.51% percent in November compared to October.

    Now how significant is -1.51%? It surely isn't telling a pretty story. We will know more when Dec numbers come out in mid Jan.
     
  7. gman65

    gman65 Well-Known Member

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    Rubbish.. one month falls in isolation mean little
     
  8. The Y-man

    The Y-man Moderator Staff Member

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    Rather than argue the statistical significance - has anyone taken advantage of it?

    The Y-man
     
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  9. Propertunity

    Propertunity Well-Known Member

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    On an $800K property 1.5% represents $12K. I've bid at auction in bigger increments than that.

    That aside, a small retraction in price after many years of strong growth is pretty much to be expected. But 1.5% is not something I'd call significant. 10% maybe.
     
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  10. standtall

    standtall Well-Known Member

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    Means absolutely nothing except:

    1) Factor into valuations (they are now doing weekly updates)
    2) Bank post code risk assessments use monthly indices
    3) Used by residential property investment funds for asset allocations
     
  11. standtall

    standtall Well-Known Member

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    10% on monthly indices would be a complete disaster. 1.5% monthly drop is 18% annualised drop - I wouldn't go that far unless the small monthly declines persisted over next few months.
     
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  12. gman65

    gman65 Well-Known Member

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    ..based on individual suburbs, not an aggregate.

    Banks don't go off one off monthly figures. They will dive into more details on any given area on comparable salea and their own data.

    Again, other than some limited index funds, they don't totally revisit their portfolio based on a single months figures. Blind Freddy has been saying unit prices would fall in the larger cities for many months. If they haven't already reduced their exposure there already they are probably in trouble anyway.
     
  13. DaveyB

    DaveyB Well-Known Member

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    Yet Darwin apartments up 9% in a month? That proves the folly of core logic info


    [



    QUOTE="standtall, post: 320352, member: 3369"]Means absolutely nothing except:

    1) Factor into valuations (they are now doing weekly updates)
    2) Bank post code risk assessments use monthly indices
    3) Used by residential property investment funds for asset allocations[/QUOTE]
     
  14. urbanista

    urbanista Member

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    Statistically speaking, in order to say that average (what's that btw: median?) price in November was significantly different to October, we need more information. At the very least we need to know price variance in the both months. Even then we would never be able to achieve 100% statistical significance.
     
  15. hammer

    hammer Well-Known Member

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    Month to month Darwin stats are usually out of whack. I don't think there's anything wrong with the stats, its just that the market too small and volatile.

    In the Third quarter the NT had a new government who introduced a new FHOG as well. That probably has something to do with it. Also it's coming from a super low base as no one has been buying here for a year or so.

    Melbourne numbers should be a little better. The sample size is 35 times larger....
     
    Last edited: 14th Dec, 2016
  16. EconomicAcrobat

    EconomicAcrobat Member

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    Do you have month on month change for the last 12 months? (Not the year on year change). The trend in in the month on month change will be what's telling.

    -1.51% sounds like nothing but if that were to be annualised that's almost a 20% fall over the next year.
     
  17. EconomicAcrobat

    EconomicAcrobat Member

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    There are something like 16,000 sales in Melbourne every month. So the stats are saying that the 16,000 sales in November were down in price 1.51% from the 16,000 the month before.

    16,000 samples is statistically very strong so it cant be written off as statistical noise unless you calculate the standard deviation.
     
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  18. MTR

    MTR Well-Known Member

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    I would not be ignoring anything at the moment.... however the stats are broad, stats can not tell you a particular area or areas its not a micro level, so it comes down to looking after and understanding where and what you have purchased is still going strong.

    I have been watching my patch in Croydon, Vic and we are seeing more supply of townhouses coming on the market, its not doom and gloom, however the end values may fall back slightly? then it could be time of the year at the moment. However, older homes on large land component very much in demand at the moment.
     
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  19. Mustafa Salehi

    Mustafa Salehi Well-Known Member

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    There are 100s of sub markets and this fall might be caused due to the softening of the apartment market.
     
  20. Propertunity

    Propertunity Well-Known Member

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