Subdivision is a great way to wealth creation. So how do you get started?
Property investor Rod McShane suggests: “The smaller the subdivision, generally the less risk. A house on a large block suitable for two dwellings may be the ideal first time subdivision.
“Consideration then has to be given as to whether you’re building a second dwelling to keep the property long term or to sell it off and place the money back into debt reduction of an existing mortgage.”
Many property commentators recommend developing a property to create positive cash flow to assist in reducing debt on existing loans or even purchasing further property for your portfolio.
One investor, Martin Ayles, discovered property development by accident. He had been renovating and selling for many years when an opportunity arose for him to subdivide an allotment with an existing house.
When a profit resulted, he realised what he’d been overlooking and has been hooked on subdividing ever since.
“Subdivision is an extremely powerful method of dividing to multiply your profits, however, if you sell everything, money’s easily spent. I recommend a ratio of about five to one, so for every five that you build, retain a minimum of one,” he advises.
“I’d also suggest trying to get the properties generating cash flow rather than having them negatively geared.” That way you could develop five properties and keep one to pay your profits into, reducing debt down so the weekly rent could more than cover the mortgage.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Thursday, February 18, 2010
New Business At Waterford Village Shops
We now have a Chinese food shop in residence - MY Noodle Bar.
They are situated in the same centre as our Professionals Marsden office - Shop 7, 42 - 48 Bourke St, Waterford Village.
We also provided accommodation for the shop manager in one of our rentals - great synergy.
They are situated in the same centre as our Professionals Marsden office - Shop 7, 42 - 48 Bourke St, Waterford Village.
We also provided accommodation for the shop manager in one of our rentals - great synergy.
Monday, February 15, 2010
Is Subdivision the Wave of the Future?
Nationwide State Governments have been considering blueprints for future urban growth within their capital cities, suburbs and country towns. The reasons include not only population growth but also a predicted increase in numbers of the aged and single person households.
One person championing this type of planning is Harley Dale of the Housing Industry Association. He views property development as “a topical thing to be looking at, in the sense that you would expect subdivisions are going to become more prevalent in the future and it’s an aspect of housing that’s going to increase over time.”
“The two primary reasons for that are what’s going on with growth boundaries in cities and density requirements for housing.” In many areas now you have “significant land constraints, which in turn will channel more people down the route of subdividing in terms of property investment,” Dale adds.
He continues saying: “We’re probably going to see this as a more viable investment option, simply because there’s been a massive increase in the price of land in recent times. This has been particularly occurring on the fringes of capital cities.” This trend could direct people’s thinking more towards subdivision as opposed to developing a new block.
He concludes: “People looking to invest in property are going to see an incentive there to supply the market, but within constraints that might promote more subdividing than we’ve seen in previous cycles.”
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
One person championing this type of planning is Harley Dale of the Housing Industry Association. He views property development as “a topical thing to be looking at, in the sense that you would expect subdivisions are going to become more prevalent in the future and it’s an aspect of housing that’s going to increase over time.”
“The two primary reasons for that are what’s going on with growth boundaries in cities and density requirements for housing.” In many areas now you have “significant land constraints, which in turn will channel more people down the route of subdividing in terms of property investment,” Dale adds.
He continues saying: “We’re probably going to see this as a more viable investment option, simply because there’s been a massive increase in the price of land in recent times. This has been particularly occurring on the fringes of capital cities.” This trend could direct people’s thinking more towards subdivision as opposed to developing a new block.
He concludes: “People looking to invest in property are going to see an incentive there to supply the market, but within constraints that might promote more subdividing than we’ve seen in previous cycles.”
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Friday, February 12, 2010
Property Seminar
* INVESTORS
* FIRST HOME OWNERS
* How to qualify for $$$...
* RE FINANCING
Westpac Business Banking Centre
Level 2, 3950-3952 Pacific Highway
LOGANHOLME QLD 4129
6pm sharp Tuesday March 23rd 2010
LIMITED PLACES AVAILABLE: Please confirm your attendance at Westpac Logan Central or any Professionals Logan Lifestyles office
How to Attract a Long-term Tenant
If you own an investment rental property and want a long-term tenant, then you have to put yourselves in their shoes. Tenants are like owner occupiers. While struggling to match the current rental prices, they expect value for their money. So you need to offer appropriate benefits.
Here’s a list of tenant desirables:
* A clean, tidy and well-maintained property. The tenant needs to feel that the landlord will attend to any repairs or maintenance issues and is willing to spend money on their investment property.
* A good location. Just like owner-occupiers, tenants seek closeness to essential services to meet their lifestyle choices. Nearby shops, schools, transport and leisure facilities all count and are highly sought after.
* Storage space. Tenants like plenty of storage and cupboard space. Everyone has personal items and plenty of possessions that need a space. This includes a safe place to park the car!
* Little luxuries. Tenants all look for dishwashers, air conditioning and good heating. These appliances are at the top of their list.
* New renovations. Tenants like fresh paint and new carpeting. They also like a fresh, airy feeling with plenty of light and will pay that little extra to feel comfortable.
These amenities can separate your property from a similar one in the area. Hence, it will have broader tenant appeal and can command a higher price than
similar properties lacking these attributes.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Here’s a list of tenant desirables:
* A clean, tidy and well-maintained property. The tenant needs to feel that the landlord will attend to any repairs or maintenance issues and is willing to spend money on their investment property.
* A good location. Just like owner-occupiers, tenants seek closeness to essential services to meet their lifestyle choices. Nearby shops, schools, transport and leisure facilities all count and are highly sought after.
* Storage space. Tenants like plenty of storage and cupboard space. Everyone has personal items and plenty of possessions that need a space. This includes a safe place to park the car!
* Little luxuries. Tenants all look for dishwashers, air conditioning and good heating. These appliances are at the top of their list.
* New renovations. Tenants like fresh paint and new carpeting. They also like a fresh, airy feeling with plenty of light and will pay that little extra to feel comfortable.
These amenities can separate your property from a similar one in the area. Hence, it will have broader tenant appeal and can command a higher price than
similar properties lacking these attributes.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Monday, February 1, 2010
Building Inspections Bring Peace of Mind
Buying a property is often very emotional. You see something you like and the impulse is to buy it. But it’s what you don’t see that necessitates a building and pest inspection before buying.
Getting a building inspection done lets you know that the property is structurally sound. It also tells you about rising damp in the walls and if the wiring is up to standard. It will also tell you the condition of the roof. All these things are not normally known upon one’s own visual inspection.
Even new properties and renovated ones need inspecting.
Peter Georgiev, an architect who inspects for Archicentre, delineates the three most common types of inspections.
“There’s the investor who wants to have some knowledge that the property is not going to cost them a fortune….Then there’s the purchaser who is looking at something to renovate and they really want a position statement as to whether the property has reasonable bones for renovation…and there are those people who think they’ve got a property that they can move straight into and they want an assurance that the place is not going to cost them a lot of money in the short term,” he comments.
“Having a property inspection done is a small price to pay for the peace of mind it brings”
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733
Getting a building inspection done lets you know that the property is structurally sound. It also tells you about rising damp in the walls and if the wiring is up to standard. It will also tell you the condition of the roof. All these things are not normally known upon one’s own visual inspection.
Even new properties and renovated ones need inspecting.
Peter Georgiev, an architect who inspects for Archicentre, delineates the three most common types of inspections.
“There’s the investor who wants to have some knowledge that the property is not going to cost them a fortune….Then there’s the purchaser who is looking at something to renovate and they really want a position statement as to whether the property has reasonable bones for renovation…and there are those people who think they’ve got a property that they can move straight into and they want an assurance that the place is not going to cost them a lot of money in the short term,” he comments.
“Having a property inspection done is a small price to pay for the peace of mind it brings”
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733
Monday, January 25, 2010
The Importance of Marketing
To be in step with the market you need to do your research. The way to do this is to review other listings, prices, and how long properties are on the market. This gives you a good feel for the market and its strengths and weaknesses.
By doing your own research you can avoid the hearsay of others who see people flocking to an open inspection and forming wrong opinions. Don’t make the mistake of selling based on what you think your property is worth or what you want it to be worth. Instead, go by the market.
By finding the right price you will at the same time find the right buyers. It makes no sense to overprice, because you’ll only disappoint viewers and lose valuable time. In the end you could end up selling for less than what you could have sold for in the beginning with the right price in the first place.
With the importance of presentation you might even consider hiring a stylist, someone who specialises in preparing properties for sale. They can assist you with refurnishing, landscape gardening, renovations and de-cluttering. All very important aspects of getting the most of your sale.
Another approach to presentation is to attack the 5 senses—sight (visual presentation), sound, smell, touch and taste. An example might mean having an immaculate and spacious feel with plenty of light, some floral arrangements, cookies in the oven and soft furnishings.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
By doing your own research you can avoid the hearsay of others who see people flocking to an open inspection and forming wrong opinions. Don’t make the mistake of selling based on what you think your property is worth or what you want it to be worth. Instead, go by the market.
By finding the right price you will at the same time find the right buyers. It makes no sense to overprice, because you’ll only disappoint viewers and lose valuable time. In the end you could end up selling for less than what you could have sold for in the beginning with the right price in the first place.
With the importance of presentation you might even consider hiring a stylist, someone who specialises in preparing properties for sale. They can assist you with refurnishing, landscape gardening, renovations and de-cluttering. All very important aspects of getting the most of your sale.
Another approach to presentation is to attack the 5 senses—sight (visual presentation), sound, smell, touch and taste. An example might mean having an immaculate and spacious feel with plenty of light, some floral arrangements, cookies in the oven and soft furnishings.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Monday, January 18, 2010
Sellers Need to be Attentive to the Market
In a tougher selling environment, it doesn’t pay to be overly optimistic when setting a sales price. Someone with a home worth $450,000-500,000 should not let themselves be talked into setting a price of $600,000 on their property. This can only lead to disillusionment and a loss of money.
Not only will you be paying additional advertising costs as well as extra payments on your mortgage, but you will also usually find that you will have to lower your price further than the $450,000-$500,000 mark, because buyers will assume something is wrong with the listing. Plus, the market may have moved south since you first listed.
One thing for sure, it’s best to listen to your chosen agent and to trust their judgment regarding what the market is willing to pay. If you don’t trust your agent, then find someone else, but if you do, then follow his or her advice.
If your agent advises you that an offer is a good one, then take it. Remember, too, if two similar offers come in at the same time, then chances are that’s where the market is.
Fortunately, because the whole market is soft, you have the luxury of taking your time buying and can expect a similar discount when purchasing. So, in the end, you break even.
It’s also best to first sell your own home before purchasing another to avoid expensive bridge financing.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Not only will you be paying additional advertising costs as well as extra payments on your mortgage, but you will also usually find that you will have to lower your price further than the $450,000-$500,000 mark, because buyers will assume something is wrong with the listing. Plus, the market may have moved south since you first listed.
One thing for sure, it’s best to listen to your chosen agent and to trust their judgment regarding what the market is willing to pay. If you don’t trust your agent, then find someone else, but if you do, then follow his or her advice.
If your agent advises you that an offer is a good one, then take it. Remember, too, if two similar offers come in at the same time, then chances are that’s where the market is.
Fortunately, because the whole market is soft, you have the luxury of taking your time buying and can expect a similar discount when purchasing. So, in the end, you break even.
It’s also best to first sell your own home before purchasing another to avoid expensive bridge financing.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Friday, January 15, 2010
Browns Plains Office Gets Renovated
Our tired old Browns Plains office got a much deserved renovation over Christmas & New Years 2009/2010. Professionals Logan Lifestyle sends a special thanks to all that were involved :)
Tuesday, December 22, 2009
Have Fun With A Splash!!
The time is upon us when it is considered normal to get up on your holidays and roll straight out of bed and into the pool, please remember that some of us cant swim and the need for secure pool fences is a must during summer. Make an extra effort to make sure kids are not left alone in the pool and that there are the proper signs in the pool area with emergency CPR information.
Monday, December 21, 2009
Happy Birthday Elene!!
We would like to wish Elene Shorter, one of our wonderful property managers, a very Happy Birthday!!!
Watch Every Drop!!
As we all know we are having very dry conditions this Christmas with “the chance” of rain.. Remember that before you light up your open fire that you check with the local SES or fire station to see what the fire conditions are like. Also please remember that you are allowed to water your lawn or wash your car but only between the hours of 4pm and 10am. If you are unsure about this or you have any questions please contact the Logan City Council.
Friday, December 18, 2009
New Slogan!!
This summer is it cool to slip, slop, slap and WRAP!!! Slip on a shirt, slap on a hat, slop on some 30+ sunscreen and wrap some UV protective sunnies around your eyes, be sun smart this summer … Remember is it not cool to have a melanoma..
Mark Sutton from our Browns Plains office is showing how to slip, slop, slap but remember to wear your sunnies.
Christmas Lights Tour
The council’s free Christmas lights tour may be over, but bundle the family into the car and make your own!!! The Albert and Logan News have listed all the entrants for the 2009 McDonald’s Christmas Lights Competition. The entrants all listed on page 37 of The Albert and Logan News Friday December 18th Edition have the address so you can take the family and have a great time looking at the lights. The entrants welcome people to come past and have a look!!
Wednesday, December 16, 2009
Professionals Follow Me Campaign
Head in to one of our four offices today to receive your free copies of Professionals Pathway magazines. Pathway magazines cover all aspects of property from buying to selling, moving, preparing to sell, and managing an investment property. There are 5 to collect so don’t miss out!
Can’t get to our offices? Visit www.bestvaluebrand.com.au/pathways to view the Pathway magazines in electronic format. Free, reusable and easy to use.
Plus if you leave your email address with your local office, or complete the form at www.bestvaluebrand.com.au/pathways, you can go into the draw to win a Piaggio XEVO 250cc scooter.
Free property magazines and a chance to win a neat ride – visit Professionals Logan Lifestyles today.
Monday, December 14, 2009
Browns Plains Office Enjoying Christmas
Once again Mark Sutton from our Browns Plains Office has showed some Christmas spirit by decorating the office so that everyone who walks in gets a bit of Christmas joy into their day.
Selling Tips in a Buyer’s Market (Part Two)
In a buyer’s market it’s extra important to assure that your asking price actually reflects your property’s current value. By pitching your property too high, you miss out on the initial wave of interest. Then, when you drop your price, people think there’s something wrong or that you’re getting desperate.
Plus, by being more realistic, you also can limit your marketing expenses since your selling campaign is likely to be shorter in duration.
The method of sale may also be affected. Auctions tend to work better in heated markets, since the marketing campaign will be shorter and intense competition drives the price higher. When there are less buyers around, your auction campaign will stretch out from a few weeks to six to eight. So it may be better to advertise as a private sale with a set asking price. This allows you to spread out your marketing dollars over a longer period. And, you can then deal with buyers on an individual basis.
But, most important of all, is to remember that while you may be selling into a buyer’s market, if you’re re-purchasing you’re also going to get similar reductions. So, in the end, you are not disadvantaged at all. And, if you’re trading up, you may even be advantaged, because the discounts will exceed your discount.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Plus, by being more realistic, you also can limit your marketing expenses since your selling campaign is likely to be shorter in duration.
The method of sale may also be affected. Auctions tend to work better in heated markets, since the marketing campaign will be shorter and intense competition drives the price higher. When there are less buyers around, your auction campaign will stretch out from a few weeks to six to eight. So it may be better to advertise as a private sale with a set asking price. This allows you to spread out your marketing dollars over a longer period. And, you can then deal with buyers on an individual basis.
But, most important of all, is to remember that while you may be selling into a buyer’s market, if you’re re-purchasing you’re also going to get similar reductions. So, in the end, you are not disadvantaged at all. And, if you’re trading up, you may even be advantaged, because the discounts will exceed your discount.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Monday, December 7, 2009
Selling Tips in a Buyer’s Market
With the credit crunch biting into the property market, sellers have to adjust their tactics to sell. In slower markets supply outweighs demand, so conditions differ from times when property booms are occurring.
Firstly, do not shy away from advertising. In periods like this you have to actively seek buyers as opposed to waiting for them to come to you. Those who more heavily promote themselves in tougher periods will get more bang for their dollars, because other sellers tend to cut their ad budgets. So your ads will stand out.
The next thing is to be more flexible with your inspection hours. It’s necessary to have open-for-inspections, but with a more limited market you also need to make your property available for private appointments as well. This way you’ll attract more buyers by offering times that suit their schedules.
In buyers’ markets, prospective purchasers can be more fussy than normal because they tend to have the upper hand. So it’s good to cater to this sentiment remembering that lifestyle considerations and emotions also kick in. Thus, you need to present your property in the best possible light. That means keeping the garden looking topnotch, possibly adding more plants, replacing worn carpets and keeping the kitchen and bathrooms sparkling clean.
Things to particularly look out for are that there’s no cigarette odour, mould or pets.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Firstly, do not shy away from advertising. In periods like this you have to actively seek buyers as opposed to waiting for them to come to you. Those who more heavily promote themselves in tougher periods will get more bang for their dollars, because other sellers tend to cut their ad budgets. So your ads will stand out.
The next thing is to be more flexible with your inspection hours. It’s necessary to have open-for-inspections, but with a more limited market you also need to make your property available for private appointments as well. This way you’ll attract more buyers by offering times that suit their schedules.
In buyers’ markets, prospective purchasers can be more fussy than normal because they tend to have the upper hand. So it’s good to cater to this sentiment remembering that lifestyle considerations and emotions also kick in. Thus, you need to present your property in the best possible light. That means keeping the garden looking topnotch, possibly adding more plants, replacing worn carpets and keeping the kitchen and bathrooms sparkling clean.
Things to particularly look out for are that there’s no cigarette odour, mould or pets.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Monday, November 30, 2009
How to Attract the Ideal Tenant
Most people looking to rent first look for a property in a great position. For tenants, that would mean a good aspect, close amenities, nearness to work, etc.
The next thing is a property with plenty of storage and a garage.
Following this is a property that’s clean and in good repair with a sympathetic property manager that listens to a tenant’s needs and forwards requests to the landlord. Every tenant wants a landlord that will maintain the property.
Another desire is for privacy, a reasonable rent and fair rent increases.
If a tenant encounters these things, then their next wish is to achieve a long-term tenancy. This translates into a property that will not be put onto the market for sale.
Even with the current shortage of rental properties, the best tenants always seem to have a choice of renting the properties they prefer, simply because property managers feel most comfortable recommending such clients to their landlords.
So if you are an investor who wants good, long-term tenants, then consider providing your tenant with what they want.
The key to the above is to invest in the right type of property in the right location. If you buy where there will always be strong demand fulfilling the above criteria, you will be the most likely to attract the ideal tenant.
If you have a property for rent and would like it to be professionally managed, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
The next thing is a property with plenty of storage and a garage.
Following this is a property that’s clean and in good repair with a sympathetic property manager that listens to a tenant’s needs and forwards requests to the landlord. Every tenant wants a landlord that will maintain the property.
Another desire is for privacy, a reasonable rent and fair rent increases.
If a tenant encounters these things, then their next wish is to achieve a long-term tenancy. This translates into a property that will not be put onto the market for sale.
Even with the current shortage of rental properties, the best tenants always seem to have a choice of renting the properties they prefer, simply because property managers feel most comfortable recommending such clients to their landlords.
So if you are an investor who wants good, long-term tenants, then consider providing your tenant with what they want.
The key to the above is to invest in the right type of property in the right location. If you buy where there will always be strong demand fulfilling the above criteria, you will be the most likely to attract the ideal tenant.
If you have a property for rent and would like it to be professionally managed, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
Tuesday, November 24, 2009
The Difference between Median and Average Pricing
Real estate data can be quite daunting at times, but to make intelligent investment decisions, it pays to get a grasp of the numbers.
One misunderstood but often quoted statistic is the “median price”. You find it everywhere when housing values are discussed. The method of compilation involves sorting the prices for all the houses or apartments sold in a particular period, from highest to lowest, and then selecting the middle one as an indication of the characteristic price for the area.
But the median price is not the same as the average price. They are two different calculations. If seven properties sold for $180,000, $200,000, $205,000, $215,000, $230,000, $310,000, and $2,500,000 then the median price would be $215,000 and the average price $548,571. That’s quite a difference!
“Averaging produces a figure that isn’t necessarily an accurate representation of what’s going on because it only takes one or two very high or low sales to skew the result,” points out Enzo Raimondo, head of the REIV. “It’s also important to remember that a median price is based only on the properties that have been sold, not all the property that exists in the area.”
The median price of an area should not be used to assess the relative value of a property. Individual streets, for example, can have large variations from the surrounding neighbourhood.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
One misunderstood but often quoted statistic is the “median price”. You find it everywhere when housing values are discussed. The method of compilation involves sorting the prices for all the houses or apartments sold in a particular period, from highest to lowest, and then selecting the middle one as an indication of the characteristic price for the area.
But the median price is not the same as the average price. They are two different calculations. If seven properties sold for $180,000, $200,000, $205,000, $215,000, $230,000, $310,000, and $2,500,000 then the median price would be $215,000 and the average price $548,571. That’s quite a difference!
“Averaging produces a figure that isn’t necessarily an accurate representation of what’s going on because it only takes one or two very high or low sales to skew the result,” points out Enzo Raimondo, head of the REIV. “It’s also important to remember that a median price is based only on the properties that have been sold, not all the property that exists in the area.”
The median price of an area should not be used to assess the relative value of a property. Individual streets, for example, can have large variations from the surrounding neighbourhood.
If you have a question about real estate, or would like assistance in locating a property, feel free to phone me, Noel Thompson Principal Professionals Logan Lifestyles at either Browns Plains 3800 4000, Marsden 3200 4495, Springwood 3808 5544 or Waterford 3299 7733.
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