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Predicting Property Prices – It’s A Science Not An Art

One of the best indicators of future property price growth – or decline – in a specific location is the pattern with transaction levels in the area.

Every three months we analyse property sales activity in every significant suburb and town throughout Australia for the quarterly editions of The Price Predictor index and this analysis reveals the locations where prices are likely to fall or stagnate or decline.

Sales volumes are always a good indication of future property price movements.

When sales numbers rise steadily over consecutive quarters, prices inevitably will rise. Fortunately, there is a time lag between a change in market activity and major impact on prices, and this allows investors who spot the trend to buy ahead of the price growth.

Conversely, if there is a steady quarter by quarter decline in sales activity in a location, price growth is likely to falter and in some cases prices may decrease.

This analysis forms the basis on The Price Predictor Index report which I regard as our most important report.

Mainstream media tells us what has happened recently with prices – growth or decline in the past quarter or the past year –  but the Price Predictor Index can provide a forward indicator of what is likely to happen to prices in the near future.

This report has sections on every capital city and all the state and territory regional markets.

We’ve just published the new Autumn 2022 edition of the Price Predictor Index and it reveals particularly strong sales activity, likely to lead to price growth, in most major markets around Australia.

One example is Melbourne, where in the previous quarter transaction levels dropped as a result of ongoing Covid lockdowns. That most recent lockdown came to an end in October 2021 and our latest quarterly analysis shows that, since then, the Melbourne market has surged out of lockdown with most suburbs recording significant increases in transaction numbers.

As a result, we expect Melbourne to do better this year in terms of property price growth than it did last year.

Perth also is a city to watch now that it has opened its borders to other states and internationally. Its sales activity is also trending upwards and we are likely to see higher levels of price growth in the Western Australia capital than we did last year.

Price Predictor IndexThis report has several feature sections, including our National Top 100 supercharged suburbs and also a comprehensive list of the nation’s most consistent markets.

For these and other reasons, the Price Predictor Index has become one of our most compelling reports.


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