By now you may have realised that making investment decisions based on FACTUAL property market indicators (the 8 supply and demand stats) instead of emotion is the way to go.
You can get the data for the 8 property market indicators from various different individual online sources such as property portals and government websites. However, beware … Bad data from unreliable sources can be very misleading and result in a bad investment decision. So, never rely on just one statistic (e.g. Days on Market) in isolation to make a decision. And, certainly, never rely on one statistic from only one source.
Always assess all 8 statistics in COMBINATION for each suburb … and always COMPARE suburbs against each other ... and always track the TRENDS in the statistics over time to get a feel for where the market is moving. The sweet sauce really is held in viewing the trends of all the property market indicators - the 8 supply and demand statistics I have mentioned in this Guide in COMBINATION and SIDE BY SIDE for EVERY single suburb in Australia (there are 15,000+ of them!)... And, of course, look closely at and monitor the TRENDS in all this data over time. I simply can't emphasise this enough!
There are 30,000 micro property markets in Australia...
…. That’s 15,000 ‘Unit’ markets and 15,000 ‘House’ markets across each of the 15,000 Australian suburbs.
Fortunately, Australia loves to collect property market statistics … so there are at least 8 supply and demand statistics (as covered in Chapter 4 of this Guide) available for every suburb - in most cases for free and from a long line of online sources. These property market statistics can be a powerful indicator of a property market’s health and can indicate whether a market is set to benefit from imminent capital growth … which is the goal of any seasoned property investor.
But like all data, property market data is also subject to anomalies and inaccuracies. The problem is the data quality can vary from source to source and from month to month.
How to reduce the chance of picking a dud property location
So which data is best at any given time?
To overcome this concern, it’s best to focus on all property market indicators, and over a period of time (the trend) … and this will reduce the risk of data quality issues or errors.
But very few property investors know where to find these property market statistics … and even fewer know how to bring them together in order to compare, rank and analyse 30,000 micro property markets to choose the best.
It’s hardly surprising … finding and collating the 8 stats data for 30,000 property markets and then comparing and ranking all of these is a massive task even for a data guru, let alone the excel spreadsheet scientist in us all! … but that’s what’s needed to OBJECTIVELY choose the best property investment locations with scientific accuracy.
Now assuming you had access to all 8 property market indicators for all 30,000 micro markets and could easily compare them side by side, what are the ideal readings for each indicator?
Few investors know what a good reading or benchmark for each statistic is… And many find that interpreting the data is even more challenging. So many give up and choose where to invest based on opinion, bias and emotion. That’s a massive gamble!
Remember that (according to the ATO) less than 1% of property investors succeed… and now you know why.
But what if I told you there was a property market research tool that could do all this suburb research with a few clicks of your mouse … and that this tool has been crunching data, driven by BIG DATA and AI (Artificial Intelligence) for over a decade … and has consistently outperformed the property experts? We will show you a case study of just this later in this Guide.
Meet our capital growth calculator, Boomscore
Boomscore rates every suburb (by house or unit) out of 100 based on how they perform across the 8 property market indicators we’ve mentioned.
The higher the Boomscore, the more demand exceeds supply, which greatly increases the probability of property value rises in that location for that property type.
And now you can do our 'Boomscore Property Market Research Course' to learn how best to use the tool to rank order capital growth suburbs that suit your strategy, delve into the stats, and then monitor your chosen locations (to know when to buy … or sell). Even my 6 year old daughter has used it with success, beating the property experts (as you’ll see in Chapter 7).
Article by Michael Fuller