Property mag data tables - reliable?

[Of The Vultures]

I've got myself a copy of three current property mags (API, YIP, SPI) to check out the data tables etc. Just wondering how reliable are the statistics they report since I've found some differences.

Example: postcode 4700 Rockhampton City vacancy rates
API: Jul '11 37 vacancies 1.3%
Jul '12 35 vacancies 1.2%

YIP: has numerous listings under this postcode and for June not July. Using Rockhampton City:
Jun '11 3 vacancies 0.96%
Jun '12 15 vacancies 3.34%

Or aggregating the suburbs listed together:
Jul '11 31 vacancies (>1.5% rate, sorry didn't calculate)
Jul '12 55 vacancies (>2%)

SPI: same as API.

So should I just ignore YIP and believe the other two since they seem to report the same figures?

Also looking at API, reading their explanation of how they calculate gross rental yield sounds right to me, but doing the calculation on the data gives me different results... what the?

Example: NSW Houses, Abbotsbury yield reported at 4.8%
Median given is $675000, median rent is $530.
So 530*52 = 27560
(27560/675000)*100 = 4.08%

Another one, NSW Houses Abbotsford yield reported at 3.1%
Median 971000, median rent 620
620*52 = 32240
(32240/971000)*100 = 3.3%

Same for just about all of them, some out quite a bit. Haven't checked this in the other mags yet.

What am i missing??

 

[dog]

Very good question, I'm gonna follow this one closely...

Anyone?

 

[norwoodman]

It comes down to the way the data is measured. The problem with the way regional centres are measured is that it isn't made clear whether the suburb is being referred to or the group of suburbs that make up the regional centre.

This was evident in the way YIP's annual Top 100 is done. The mention of places like Gladstone and Townsville doesn't make clear whether they are talking about Gladstone and Townsville or New Auckland and Thuringowa yet the major cities are broken down by suburbs. I suspect this is why the Rockhampton numbers vary - Rockhampton City as opposed to Rockhampton City plus Allenstown plus Norman Gardens, etc. You're not necessarily measuring apples with apples.

There's other issues including that transactions only represent a portion of the total stock, rents don't necessarily correspond with the properties around the median price, and a whole load of other things. This is talked about in an article in the API October magazine if I remember correctly.

 

[Jamie M]

I would only use those stats as part of a much broader due dilligence process. I look at some of those stats for local ACT suburbs and can't see how they translate to what's actually happening on the ground.

Cheers

Jamie

 

[Filo]

Hi Jamie.

I'm glad i'm not the only one in canberra not understanding the figures either.

 

[Of The Vultures]

Lies, damn lies and statistics! Here's another example for NSW houses, first two suburbs listed:

Abbotsbury
Median: API $675k SPI $622.5k
Median quarterly growth: API -2.7% SPI -2%
12 month growth: API 3.1% SPI -4%
3 year growth: API 8.6% SPI 21%
5 year growth: API 5.7% SPI 22%
10 year growth: API 6.0% SPI 6%
Median rent/yield: API $530/4.8% SPI $530/4%
Number sold: API 45 SPI 52

Abbotsford
Median: API $971k SPI $1,170k
Median quarterly growth: API 6.5% SPI 1%
12 month growth: API 7.9% SPI 2%
3 year growth: API 4.9% SPI 1%
5 year growth: API 1.1% SPI 14%
10 year growth: API 3.9% SPI 5%
Median rent/yield: API $620/3.1% SPI $700/3%
Number sold: API 55 SPI 27

YIP figures similar to SPI.

So. Treat with caution.

 

[Jake Milne]

Different magazines use different data providers.

Different data providers use different methods of measurement, and thus get different results.

The main data houses are: APM, RP Data/Rismark, Residex

----

It's very confusing to know who/what to trust. In my opinion RP Data has the most reliable method of measurement.

The most basic way of measuring is median sale price.

As you get more complex it is argued that your results are more precise.
RP Data/Riskmark uses geospatial, hedonic, stratified data which is quite complex and encompasses more factors than any other data provider in Australia.

----

In my opinion, because property investing is for the long term, it is better to research fundamentals of areas rather than relying on the stats.

By all mean use the stats to locate areas that tick the boxes but then research what is happening in the area that will promote growth.

 

[singingtheblues]

property stats

i wouldn't bother with the stats - especially median price & %age growth - many suburbs have such a mixed stock of houses & a low number of sales - comparability is almost impossible - without the detail they can be very misleading - it's just one of a number of tools to consult

 

[vaughan]

I find the property magazine data useful for identifying areas. The iPad version of one of the magazines has interactive data that allows the columns to be sorted dynamically, making it very easy to identify the maxima or minima -- much easier than reading them all and using a pen to highlight the interesting ones.

I then work out where the areas are geographically and which match my investment strategy to sort out where to start looking at actual properties on domain.com.au or real-estate.com.au.

The data doesn't change rapidly so there is no need to buy a new magazine each month.