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Median Prices of Suburbs |
Written by Melanie C
Tuesday, 24 June 2008
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If you are investing for capital growth, you shouldn't use the median house price as a yardstick on its own. Surveying house sales over a certain time period and taking the middle price of sales is how a median price is arrived at. But this figure can be in error. It could be that in the area there were a lot of first homebuyers who bought due to government grants. This is likely to give an impression of lower prices. Or if there have been a great many new buildings going up or even renovations, this could influence the price to a higher than real figure. The best way to find out what the prices are doing is to compare two sales of the same house in an area and see what the difference was. By comparing pairs of sales in this way you can easily see what the rate of growth was for the time involved. And it won't be artificially influenced by any outside factors. Don't be surprised to see a difference to the median price of up to 10%. So what use is the median price? You can certainly use it as a jumping off point for your own investigations. You have to start somewhere if you are looking for investment property, and it may as well be with the median house price. But don't leave it there. It is important to make your own calculations so that you can be sure of what you are getting into. Article Source: http://www.ArticleBlast.com |
About The Author:
Get help in financing your new home with QuickDirect's (http://www.quickdirect.com.au) no deposit home loan or other quick loans.
Get help in financing your new home with QuickDirect's (http://www.quickdirect.com.au) no deposit home loan or other quick loans.
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