Published on July 10th, 2012
Geoff White: Property figures are often taken out of context
When it comes down to crunching the numbers in the property market, we have to be "very careful" to look at the bigger picture, according to Geoff White.
Geoff is the state franchise manager for Elders for Victoria and Tasmania, and he emphasised that people can get carried away when it comes to comparing today's property market to movements that occurred two years ago.
Much media hype is made over the falloff in demand for property that has occurred over the past 18 months to two years, Geoff explained. But jumping to conclusions based on short-term market movements is never a good strategy.
It's important to remember that the property market can fluctuate pretty dramatically even from week to week, he explained, adding that the current market for rural property is sometimes different from one side of the state to the other.
By comparison, 2009 and 2010 was an "abnormally buoyant" period – and Geoff says it's not really fair to compare the present-day market to the high clearance rates achieved during this time.
The auction clearance rate in 2009-10 was close to 80 per cent in some areas, he explained, and while it has fallen to between 55 and 60 per cent now, today's figures are more in line with broader trends.
He also noted that it's not very fair to judge the performance of the rural property market on official auction clearance rates alone. Many properties, he explained, actually sell during the week after an auction – and when this information is taken into account, the unofficial clearance rate is often much higher.
The current market, he explained, is relatively balanced – and while it's not what it was 18 months to two years ago, it represents reasonably fair conditions for both buyers and sellers.