Using realestate.com.au data to predict price movements?

Discussion in 'Investment Strategy' started by sanpellegrino, 26th Nov, 2019.

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  1. sanpellegrino

    sanpellegrino Member

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    Does anyone pay much heed to the free data available on realestate.com.au?

    For example, if you check out a suburb, e.g. Lenah Valley Property Market, House Prices, Suburb Profile & Investment Data there's a little section that shows supply and demand - i.e. the number of people looking at listings in this suburb vs. the average for the state:
    upload_2019-11-26_14-16-16.png
    Wouldn't a significantly higher demand for this suburb be a good indicator that prices should be on the rise?

    On the other hand, there's also median property price chart... And in this suburb, prices have basically not moved for the last 12 months:

    upload_2019-11-26_14-19-56.png

    So... something doesn't feel right about this data. Any thoughts?
     
  2. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    I don't think you could read to much into that statistic in isolation. Not knowing anything about Lenah Valley, how does this translate into views per listing?

    If there's 2000 properties for sale in Lenah Valley then that's only one view per property which probably isn't a good sign. If there's only 10 for sale, then there's probably a lot of interest.

    Probably a better stat to start with is the 'days on market', which is how quickly a property is likely to sell in a given location. Even that will have false indicators though, you need to look at data both individually and collectively.
     
  3. sanpellegrino

    sanpellegrino Member

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    It's visits per property... So 2000 per property on average.

    Days on market is a good one too - is there anywhere you can get that for free?
     
  4. vudu

    vudu Well-Known Member

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  5. sanpellegrino

    sanpellegrino Member

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    Thanks Vudu... I wonder what a good days on market benchmark is?
     
  6. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    It comes up in the RP Data reports, along with a bunch of other things. They're a great resource and lots of brokers provide these to clients.
     
  7. BuyersAgent

    BuyersAgent Well-Known Member Business Member

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    I like Lenah Valley. Visits per property is just 1 metric and says something about buyers behaviour - ie they like to look online a lot. It MAY indicate some kind of elevated demand right now. That can change though so it isn't a long term metric. As per @Peter_Tersteeg 's comment in isolation it is useless. What other metrics are you considering? What if I told you vacancy rate had been rising all year (which is technically true) is that concerning or not? (it may not be depending on the base) What if I told you stock on market was unchanged since February? Is that good or bad?
     
  8. sanpellegrino

    sanpellegrino Member

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    I take your point - not suggesting that using only a single metric is a good idea...

    Re stock on market being unchanged - that should be reflected in days on market metric, shouldn't it?

    What other metrics would you consider important?
     
  9. vudu

    vudu Well-Known Member

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    At risk of stating the obvious... Comps!
     
  10. BuyersAgent

    BuyersAgent Well-Known Member Business Member

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    Maybe, but not always. Stock on market is the volume (either a raw number or a percentage) of homes in a suburb for sale. The total (in my opinion) is less relevant than the total as compared with a historical figure for the same suburb.

    Days on market is the speed of selling. It is possible to have rapid selling but if lots of new homes coming on. (ie stock on market stays higher) In this case you may read in the paper about a hot market but may not see price growth. The optimum combo (if you are brave enough to buy into it) to make immediately upcoming growth more likely is FALLING stock and FALLING days (in my opinion). This is not often possible, so again... not the only thing to consider but since that is what we are talking about...
     
  11. Sackie

    Sackie Well-known cafe bum of the East Premium Member

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    I'd usually want to analyse:

    Typical value, Days on market (DOM), Discounting, Auction clearance rate (ACR) especially for Syd and Melb, Proportion of renters to home owners, Vacancy rate, Yields, Stock on market percentage changes (SOM%).

    Then I'd be calling ppl on the ground for further corroboration.
     
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