Whether you are buying or selling a home, you should be aware of various statistics that will influence your preferences, choices and eventual decisions. Not knowing the realities will make you vulnerable to mistakes, you may be misled and you will in all likelihood end up making the wrong decisions. Here are the top housing stats that matter and what you should look out for.
- Begin with the median prices. Median house prices will always change depending on various market conditions. In short, it is an accurate reflection of the prevailing market rates. Some houses will always be sold at a premium price. Those would be substantially higher than the lowest prices. Some houses will be sold at less than their perceived market values and that would depend on some shortcomings in those properties. Neither is a true determiner of what the ask price should be for your home or what kind of ask price is fair for a homebuyer. Median prices will give you a better and more accurate idea. You can also narrow down the median prices to the suburb or even neighbourhood you are looking at.
- Check the rental rates in a given area for a particular type of home. The median prices will give you a good idea of the ask price and actual sales price. Rental prices will tell you if the type of property is in demand. Speculations are always rife in the real estate market. By accessing rental prices, you would be piercing through the speculations to get the real picture.
- Number of auctions and clearance rates are important stats to consider. These may not have any major impact on a given property or how you perceive the demand of a property but you can gauge the market conditions. The market is the primary influencer in the real estate industry. Clearance rates and number of auctions are effective indicators of prevailing market conditions. Clearance rates of above 80% imply very strong market conditions, 60% to 80% indicate moderate to strong conditions and below 60% indicate a slow market.
- Interest rates determine the availability of funds. Mortgage or home loans will always determine the purchasing power of homebuyers. A market on the upswing will also always be preceded with cheaper interest rates.
- Finally, check the supply. How many properties are listed in a given area at a given point in time? Commencements, completions and housing approvals are useful statistics.