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The figures have itl! Best of ABS statistics

How do you make sense of the hundreds of reports and statistics produced monthly, quarterly and yearly by the Australian Bureau of Statistics?
How can they help property buyers? and why are these statistics not always useful?

It amazes me how many of these individual statistics are picked out of these reports by the media and whole articles (and yes, sometimes scaremongering) is created around these few figures. My issue is not with the figures themselves - they are an excellent and reliable source of information. My issues are with the interpretation of the figures:

  • How relevant are the figures to a certain property type e.g. looking at figures about housing may not tell you anything about the actual situation with units in an area
  • A city's figures don't tell me what the situation is in the suburb(s). Each city has its own micro-regions and also micro-economies. The situation, for instance, in Caboolture may be very different to the situation in Brisbane's CBD. So examining Brisbane figures doesn't really tell me what the situation is in the CBD property market.
  • New dwelling figures don't necessarily correlate to existing property figures or sales. Just because people are not building new homes doesn't mean that the whole property market is in the doldrums. The demand and dynamics for resale properties may be a very different kettle of fish.
  • How old are the figures i.e. has the situation (economic, global, property etc.) changed since they were released?

My advice:

  • Beware of generalisations about a city or region and the current market.
  • Research, research, research: Examine other factors affecting the market; research your suburbs of interest (situation now, future city plans and infrastructure developments), and type of property; ask advice from various local specialists and examine the information/data they use to back up their opinions.

Here are some of the most relevant ABS reports for property buyers, investors, owner occupiers and analysts. But be warned ... not everything that is a statistic is relevant for you.

House Price Index – Eight Capital Cities, Report No. 6416.0 - quarterly. This report compares capital cities' house prices. It's interesting but not as relevant for such a market as Brisbane CBD apartments for two reasons: 1. it only looks at houses and not units. 2. it shows figures for the whole city region - from the inner city to outer-lying suburbs. Very different dynamics may be occurring within a city e.g. while the CBD is booming the outer-suburbs may be full of new housing that is not selling or being sold at much reduced prices.

Housing Finance Australia Report No. 5609.0 - monthly. This report highlights the value of financing for investors and owner occupiers as well as the number of properties being constructed. It's interesting to examine the seasonally adjusted figures, and it also gives a short text commentary to the figures and graphs.

Australian Demographic Statistics Report No. 3101.0 - quarterly. These Statistics examine key growth areas and provide a short commentary highlighting reasons why population is and will remain a main contributor to property demand. While some people choose to stay at home and save, a continually increasing population is going to need somewhere to live, whether renting or buying  property - it's as simple as that. The factors affecting this growth are important as some areas may be prone to growth through a single factor. For instance, some mining towns experienced a population boom that will suddenly stop once mining has finished unless the town/region has other important industries as well.

Dwelling Unit Commencements Australia Report No. 8750.0, Building Approvals, Report No. 8731.0 - monthly, Building Activity, Report No. 8752.0 - quarterly. These are interesting comparisons across a range of factors and regions. They focus on the new apartment market and not the situation with the resale of existing units. Therefore these figures cannot be used as a snapshot of the resale unit market.

ABS QuickStats – 2011 Census data - every five years. A good guide, however as it's now two years since the last Census its relevance is gradually diminishing as the situation within the country and globally changes over time. Next Census is due 2016.

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