Why is Sales Data important and how does it impact property?

Why is Sales Data important and how does it impact property?

One of our key investment drivers is Sales Data and it includes statistics such as auction clearance rates, stock on market, days on market and online listings views.

It plays a significant role in analysing markets as it provides essential information about local market trends and conditions. It helps identify patterns enabling more accurate valuations and recommendations.

Auction clearance?rate refers to the percentage of properties that sell at auction. It provides an indication of the overall strength of the market and the level of competition amongst buyers. A high auction clearance rate generally indicates a competitive market with strong demand for properties. While a low clearance rate suggests weak demand and a less competition.

Days on market?refers to the number of days a property has been listed for sale until it sells.

They provide different but complementary information about the market.

What metric do we prefer?

We prefer days on market as a universal metric since not all properties go to auction, so auction clearance rates aren’t as accurate.

The auction clearance rate only provides information about a specific subset of properties and may not reflect the overall market conditions.

In contrast, the days on market metric can be applied to all properties, regardless of whether they are sold through an auction or private sale. It provides a more comprehensive and universal measure of the real estate market and the demand for properties.

The following are reasons why using days on market as a metric is important when assessing property markets:

1.?Market Demand: A high number of days on market can represent a lack of demand, which may indicate that prices are too high or that the properties are not attractive to buyers. On the other hand, a low number of days on market can indicate high demand, which may indicate that prices are likely to rise in the near future.

2.?Price Point: Days on market can also help to determine the optimal price point for a property. If a property is listed for a long time without any offers, it may indicate that the price is too high.

3.?Competitive Advantage: Knowing the days on market for a particular market can give real estate agents and investors a competitive advantage. For example, if they know that properties are selling quickly in a certain market, they can take advantage of the situation by making offers quickly and negotiating better deals.

4.?Market Trends: By tracking the days on market over time, it is possible to identify trends in the property market, such as changes in demand, supply, and pricing. This information can be used to make informed decisions about buying, selling, and investing in properties.

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