{"id":7201,"date":"2016-03-03T01:00:09","date_gmt":"2016-03-02T14:00:09","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=7201"},"modified":"2016-03-03T01:00:09","modified_gmt":"2016-03-02T14:00:09","slug":"property-statistics-never-lie","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/property-statistics-never-lie\/","title":{"rendered":"Myths: Property statistics never lie &#8211; Andrew Wilson"},"content":{"rendered":"<p>&nbsp;<br \/>\n<strong>Dr Andrew Wilson<\/strong> defends the stats we all rely on and while they seem to differ, there are some ways to look at them that will reveal the true story. Andrew tells us more today.<\/p>\n<h4><\/h4>\n<h4><strong>Transcript:<\/strong><\/h4>\n<p><b>Kevin:<\/b>\u00a0 Another myth that we\u2019re either going to dispel or prove today: that property statistics never lie. I\u2019m going to talk to a man who deals with statistics all the time, Dr. Andrew Wilson, Senior Economist at the Domain Group.<br \/>\nAndrew, good morning.<br \/>\n<b>Andrew:<\/b>\u00a0 Good morning, Kevin.<br \/>\n<b>Kevin:<\/b>\u00a0 Do they ever lie?<br \/>\n<b>Andrew:<\/b>\u00a0 It depends on the models, of course. It\u2019s a problematic exercise \u2013 modeling the housing market \u2013 for various reasons. At the granular level, every buyer and seller are different, every property is different in time and space, and it\u2019s a question of putting enough observations together to get a feel for what the underlying activity levels are in a particular market.<br \/>\nThat can mean, firstly, that you need a larger number of actual sales to get an accurate insight into the market and you also need a timeframe, as well, within a period that\u2019s not looking too far back.<br \/>\nThere are a number of factors \u2013 the mix of property sales, the time period involved, and the actual volume of sales that are available. We don\u2019t want to be modeling\u2026 It\u2019s easy enough to know what happened two or three years ago because we have a robust set of statistics. We want to know what\u2019s happening as close to now as possible. That\u2019s where we do get some flexibility in outcome.<br \/>\nI think it\u2019s important for statistics in terms of house price modeling to use correlating measures of housing market activity. So not just house prices \u2013 the various methodologies \u2013 but also other factors such as auction clearance rates, auction volumes, and of course, the housing lending data that comes out from the ABS.<br \/>\nI think that helps us put a richer picture together to give us an understanding of what is actually happening now in the housing market. But the very nature of the fact that we only get 6% of all properties sold in a given year in most capital cities means that it\u2019s always only ever going to be a snapshot.<br \/>\nIt does remain a difficult issue, but nonetheless, one that if you use a variety of approaches, can give you some clear insight into what\u2019s happening in the marketplace, which, of course, is very important if you\u2019re thinking of buying and selling.<br \/>\n<b>Kevin:<\/b>\u00a0 That\u2019s an interesting statistic you just hit us with there \u2013 that 6% of properties turn over. When you look at it in that sense, it really is a small snapshot, isn\u2019t it?<br \/>\n<b>Andrew:<\/b>\u00a0 Absolutely. Then you think about all of the variety within that 6% and all the different agendas for buyers and sellers. Some sellers are desperate to sell; others might just be feeling the market out.<br \/>\nSome buyers are very keen on a particular property because it might be close to a relative or its size might suit them, and they\u2019re prepared to pay a lot more than perhaps a buyer who doesn\u2019t have that same motivation.<br \/>\nSome buyers have a higher financial capacity and are prepared to pay more, and other sellers might have more motivation or less motivation depending on their financial circumstances.<br \/>\nYou need to put all these different variables together to try to understand what the underlying energy or the underlying fact or the underlying nature of a particular housing market is. That\u2019s balanced against not having to look too far back because you want to know your information is more appropriate the closer it is to now rather than looking back a year when you have a lot of sales volume.<br \/>\nThat\u2019s the other point, too. Sales data does trickle through. Official sales data can take up to nine months to come through to those who model the data. Again, there is the lag in actually collecting the data.<br \/>\nThere are a number of issues there. As I said, the key is to use different correlating methods of measurement, so that can put it all together and give you a clearer sense of what\u2019s happening in housing markets.<br \/>\n<b>Kevin:<\/b>\u00a0 Well said, as always. Dr. Andrew Wilson, Senior Economist at the Domain Group.<br \/>\nAndrew, thank you so much for your time. Great talking to you.<br \/>\n<b>Andrew:<\/b>\u00a0 Thank you so much, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; Dr Andrew Wilson defends the stats we all rely on and while they seem to differ, there are some ways to look at them that will reveal the true story. Andrew tells us more today. Transcript: Kevin:\u00a0 Another myth that we\u2019re either going to&#8230;<\/p>\n","protected":false},"author":176692471,"featured_media":7202,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,11,13,17,22,25],"tags":[101],"class_list":["post-7201","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-property-investment","category-research-topic","category-sponsored-channels","tag-podcast"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Myths: Property statistics never lie - Andrew Wilson - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/property-statistics-never-lie\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Myths: Property statistics never lie - Andrew Wilson - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"&nbsp; Dr Andrew Wilson defends the stats we all rely on and while they seem to differ, there are some ways to look at them that will reveal the true story. 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