This month has seen the release of the Valuer General’s Property Price Guide data for Victoria for the period up until December 2012. Now you might think this data is a bit old, and should be release earlier, however it’s important to recognise where the data is being collated from and when the data is actually recognised.
The data is sourced from the State Government Land transfer area (that horrible place that collects stamp duty revenues) and is only available following the actual settlement of the property. It’s important to remember that property sale contracts can be executed many months before the actual settlement. The net result is by waiting this time, they are able to get more extensive data records, effectively making their findings more robust, when compared to data being supplied by the likes of RP Data, REIV, Australian Property Monitors and Residex to name a few of the more high profile suppliers of such data. In fact, the Valuer General’s office reports that the data capture for the period of September to December 2012 was 93 percent of all sales and in the preceding quarter of July to September 2012 was 98 percent.
As a property analyst the clarity and integrity of price data is very important and hence knowing the source of such data, give me confidence in being able to analyse it consistently with the periodically historical data that we hold from the Valuers Generals office within our Property Research division. In fact we have Valuer General data going back to when they first started recording it by Suburb in 1974. So following this release we have data by suburb, by dwelling type (House, Unit and Vacant Land) for the past 38 years.
Such data is invaluable to us to study the long term median price variances over this period to develop and enhance our property investment theory and strategies. Example of our analysis is looking at suburb/area cluster and their performances over 5, 10, 20, 30 years periods in our attempts to study the suburbs and areas that have outperformed the broader property values of the same periods of time. Once such suburbs and areas are identified only then do we start to understand the underlying factors which resulted in growth rates greater than the median or average.
Say you identify a suburb or grouping of suburbs which for the period of time between year 1990 to 2000 grew by 140% and you study what took place then, what are the reasons this happen and you identify some key indicators. You then look at another period of time when a similar growth performance took place, say 1980 to 1990 and you overlay the same key indicators that you saw when the price of property rose by that amount in the later time period (basically back-testing your theory). If you are right, then your theory might be gaining substance and you look at the current suburb or grouping of suburbs where the same key indicators are just starting or occur or history tells you they will occur and you might have just located the next so called hot spot.
It’s this type of detailed research we are constantly working on to achieve an outperform result for our clients. Do we get it right every time? – No, but the level of research we undertake and the commitment to finding the best investment returns for our clients are the reason they pay us our professional fees. They know our research is far more advanced and more detailed than what they could do themselves and they are smart enough not to take uneducated guesses with their money.
Those who have been long standing clients of ours know we like to share valuable research and data with them and this is no different. Empower Wealth is all about sharing knowledge when it comes to property investment, so you are able to make more informed decisions, through better research and study and that’s why we are happy to bring to light the availability of this data to you.
In doing so, we have uploaded Robert Marsh (Victorian Valuer General) commentary to our website for you to access. In addition if you want to download the full list of House / Unit and Vacant Land by suburb, they too will be available for download by clicking here.
Good luck with your own research and remember – Knowledge is empowering if you act of it.
Author: Ben Kingsley
CEO & Founder; Property Investment Analyst and Advisor