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SQM Research
A word from our MD, Louis Christopher


 
Starting this week, I thought I might share with you something you really ought to know - the lag times between a property selling and its transaction record ultimately making its way to the various data reporters via the various state land title offices.

What is it's relevance, you may ask?

It has a direct bearing on the compilation and timeliness of various house price series to the point that preliminary data is just that - preliminary data. 
And, whether we like it or not, revisions in house price indexes are absolutely vital. Of course, I think it also proves that unrevised daily house price indexes are in no way more accurate than throwing darts at a dartboard.

The underlying data of the below charts comes from the various land titles offices around the country. It was updated and sent to us on the 3rd of June 2013 and represents all records that came from the state land titles offices during the month of May.  The charts represent effectively a distribution curve of lag times between the date a property was sold at contract (exchange date) and the date the record was sent from the land titles office.
Firstly, here is NSW:


Source: Department of Finance and Services, Land and Property Information NSW, SQM Research

Of the 12,736 sales records sent through during the month of May, the average lag time was 110 days, meaning most of the records sent throughout May actually represented sales that happened in March, February or even earlier.  Just 46 records were reported through within 15 days of the exchange date.  In contrast there were over 544 records that had over a 300 day lag.
 
Next, QLD:


Source: Dept. of Environment and Resource Management QLD, SQM Research

In Queensland, there were 9534 properties reported through during May with an average lag time of 91 days. In this case, just 15 properties were reported within 15 days of the property being exchanged. In contrast there were 235 properties that had over a 300 day lag.
 
And lastly Victoria:


Source: State of Victoria, SQM Research

The average lag time was a staggering 221 days and that was after presuming that anything with over 2000 days was an error in the data sent. Many of those with extended lag dates of over 300 days were units. No doubt ones where the property has taken years to settle due to extended delays in construction. And note, there was just ONE record that were reported within 15 days of the property exchanging contracts. JUST ONE PROPERTY.
 
Perhaps now you can see just one of the reasons why I seriously question this daily index from RP Data. To be fair in all this, I know all reporting bodies including ourselves, receive data from other sources including real estate agents. However, compared to the total sales volumes that come from the state government departments, these other sources only represent a fraction of all sales that took place. 
Needless to say, data reporting needs to be cleaned up as the current state of affairs is appalling.   

More on all this next week including the data from other states. 




Top Ten Most Discounted Properties Nationwide
 
This week's top ten has not swayed too much from last week's list, with Queensland properties continuing to dominate - occupying six of the ten top spots. A closer look however, shows that this is not necessarily a direct reflection of the property market in Queensland, with most of these homes being located in outer areas or islands rather than suburbs close or situated inside the inner ring. That being said, SQM Research has predicted property prices in Brisbane to remain flat for the remainder of this year - with more detail surrounding this forecast being given in our recently released Brisbane Housing Boom and Bust Report for 2013/2014.  

Rank Address Suburb Postcode First seen Initial price Now asking Reduction Days on Mkt     Link
1 34 Seraya Court Closeburn 4520 13/08/2011 $1,450,000 $795,000 45% 672     link
2 9 Hughes Street Londonderry 2753 02/10/2010 $2,300,000 $1,290,000 44% 987     link
3 1 Barry Drive Redbank Plains 4301 23/02/2013 $350,000 $199,000 43% 112     link
4 7 Cassidae Crescent Tangalooma 4025 29/03/2009 $1,495,000 $875,000 41% 1539     link
5 4 Edgewater Pl Lamb Island 4184 01/08/2010 $425,000 $249,000 41% 1050     link
6 79 Perulpa Dve Lamb Island 4184 15/08/2010 $499,000 $298,000 40% 1036     link
7 38 Cloverdale Road Doolandella 4077 09/02/2013 $1,650,000 $1,000,000 39% 126     link
8 15 Gretel Two Rocks 6037 26/12/2009 $1,100,000 $699,000 36% 1267     link
9 368 Rheban Road Spring Beach 7190 08/11/2010 $760,000 $500,000 34% 952     link
10 134 Bay Road Berowra Waters 2082 21/08/2010 $1,199,000 $795,000 34% 1029     link

If you are interested in discovering where the biggest bargains are in your area, check our SQM Research's Home Discounts Report where we list all the homes in your chosen postcodes that have spent over 60 days on the market, along with all their sales history. Click here for more info and a free sample.

Black Dragon's Words for the Week

"Man is not what he thinks he is, he is what he hides."
- Andre Malraux

Rude Real Estate Realities

It was only a couple of weeks ago that SQM Research brought into the the spotlight the fact that "Centrebet" had began taking bets on the direction in which property prices are heading. We now find that according to the following article, "Sportsbet" are also allowing individuals to gamble on Australian weekly auction clearance rates! In no way does SQM condone gambling of any nature, but we think the whole concept is pretty interesting, especially in light of well reported inaccuracies behind the reported clearance rates. Perhaps it is now time for SQM Research to watch this space more closely once more?!  Click on the following link to read more about it - 

Aussies Gamble on Auction Clearance Rates
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