Wednesday, May 6, 2009/
Australian property data is generally poor. Australian auction clearance rates and private treaty information has lost credibilty and vendors and purchasers must rely on their own knowledge of their market.
Most of us are not interested in the percentage of properties that agents are prepared to publish. What matters to vendors and buyers is the percentage of properties listed for auction that week which were sold at that auction in that week.
We need some integrity in the data, whether the prices are declining or increasing. Better facts will inform vendors and buyers alike. I have attended recent auctions where properties over the $1 million mark were sold well below expectations. These results were not published. This may be due to admin issues or it may be due to lack of motivation. Either way the data needs to be independently audited before it can be relied upon.
Private treaty sales are another minefield. I have seen the same property listed as sold in the real estate listings in the Sunday papers on two occasions. Anyone without detailed local knowlege would not even notice, or would assume it was onsold. However the first listing was in March at the time of the sale, the second time in October it was listed was at the time of (extended) settlement. Again this needs auditing.
In previous years the number of properties listed for auction that week were clearly published. Most of the withdrawn (WD) and not available (NA) prices were published as line items within the listings. It was easy to see the number and location of properties listed for auction and what happened. Now, in Sydney at least, the properties listed by Domain.com and RealEstate.com for auction in that week do not correspond with the number of auction results collected and published in the Sunday papers in that week. This seems to be trending up, but is hard to track. The clearance rates are based on the number of auction results collected, which is not the most useful way to present the information in the current market.
Of course some vendors request confidentiality agreements to exlude their properties sold price from being published and these must be abided by, but these surely account for a miniscule number of transactions. These can be included in the statistics in the number of properties with no information available (NA).
Australian newspapers, which derive a proportion of their revenue from agents, are perhaps not always motivated to provide a clear picture in the property results section. They do a reasonable job in other sections. Sometimes it seems the property section’s inclusions/exclusions of relevant data are altered to create a more favourable effect, but I accept this may be due to layout issues. However, if providing greater clarity is their goal there are a number of adjustments to the provision of data which would be of great interest to most of us in the current climate. It would be useful to have the number of auctions compared with this week last year as a comparison, rather than simply giving a percentage clearance rate which may not be that useful. Volumes and numbers of withdrawals over time are easily available in their archives, but are not presented to readers.
During our lifetimes many of us will cycle through being buyers then vendors. We will make some of the biggest financial decisions of our lives and we need property information we can rely on.