Indiscriminate use of property data in particular median and average figures depicting the Australian residential market as being in the state of doom is causing unwarranted fear and confusion among property owners and investors according a to a property research firm.
Andrew Donnelly, director with Braxton Chase said that an increasing number of their clients are showing signs of nerves because of selective data that is being misinterpreted and portraying the market negatively.
"The difference in investor sentiment in the past few months have been extraordinary," said Donnelly. "The first thing many investors approaching us ask now is 'will the market implode'" Many are clearly having difficulty understanding all interpretations on where prices are heading. Generic predictions of price plunges are doing very little but scaring the daylights out of both investors and homeowners. The broader psyche of the property market is taking an undeserved battering."
Donnelly pointed out that the average and median property price data were often misread and misunderstood, creating a broad impression that prices are falling dramatically, but failing to reflect many localities and sub-localities that might be performing well in terms of capital growth.
"Plucking out one or two average median figures and use them to describe the market broadly is futile," said Donnelly. "While many parts of the market are flat and in decline right now, a combination of solid research and medium to long term outlook will easily lead buyers to countless markets and submarkets experiencing or close to experiencing good capital growth."
He added that infrastructure, population growth, supply constraints, rising rents and increasing chances of interest rates cuts were the fundamentals that should fuel capital gains in a well researched and selected properties.