Many years ago, I started using a term which I called “Market Segment” in response to the recognition that the spread of price range in prestigious suburbs like Applecross, Mount Pleasant and Attadale was huge.
You could have properties for $400,000 right up to $10M plus++
So, when buyers ask me things like, “What is the average price per sqm of land in Applecross” or I see reports of official data such as “the average days on market was 63 days”, sometimes I want to either laugh or scream or reach for a bucket. There are soooooooo many variables. The problem with averages, or norms is that they standardise things or overly simplify.
To understand markets we need to drill down deeper.
The reality for me in the areas I work it is never the norm or the same as that reported as “average”. There is no sensible way to talk norms or averages in areas that has such a massive variation of properties and values.
I divide Applecross into 10 segments, essentially to make some sense of what was happening simultaneously in the same suburb, depending on price. I measure days on market for unsold stock, sold stock, average and median values and days. It paints a vivid picture of contrast, and is fascinating to monitor and understand. I love it and understand it intimately.
All buyers and sellers must understand this concept to fully appreciate what is really happening in their respective market at that time.
I often see some price categories (Market segments) take 300 plus days to sell, and sometimes we see properties on the market 3 or more years. Imagine that!!
It is possible in the same suburb, at the same time, some market segments to be selling in 45 days and others 450 days.
I write about it in my book, titled “How to sell your home for more in any market”.
To get a FREE copy, click HERE – http://ianbarnesagent.com.au/
If you would like me to explain where your particular market segments sits RIGHT NOW please drop me a line. I would love to help.