Data Wars – The umpire strikes back
…it used to be that if you could get hold of some local property information and figure out what it meant, you had an edge over every other property investor out there. Those were the days.
I mentioned a while ago that back in about 1987 when we needed to do some comparisons on growth rates in different parts of Sydney we had to buy a clunky magnetic tape from the Sydney Water Board which contained the data we needed. It cost $40,000 ($95,000 in today's dollars).
Today, for a fistful of dollars, you can get that information from many different sources and it would fit on the head of a pin.
The question I keep asking myself is, are we really better off now or are we spoiled for choice?
Ever since the Valuer General, Land Titles Office, ABS et al started digitising their data and selling it to the private sector about 20 years ago, we have seen a battle between a bunch of empires (evil or otherwise) vying for property data supremacy. Nothing wrong with competition… but there is a problem.
Before I go on, I should confess to being a property data junkie and I reckon I’ve seen it all.
Decades ago I paid thousands to councils for property data on microfiche (microfilm to spy novel enthusiasts). Twenty years ago I had John Edwards of Residex fame in my office for hours installing data from dozens of floppy disks. Not to mention the Water Board tape, online data subscriptions and many productive research projects with our good friends at BIS Shrapnel going way back to the early sixties.
You can’t have too much information right?
But too much isn’t the problem. The problem is nobody agrees on anything. Inevitably the data that gets released and grabs media attention one day will contradict the numbers released by another outfit the next day. Prices went up says one…prices went down says another. Not very helpful really.
It boils down to different methodologies and the “robustness” of the data. At least that is what the data empires will tell you, but really the property data industry has become a race. A race to publish the latest numbers before their competitors and a race to find interpretations of data that resonate in the media space. A space race.
Until a winner is declared, all I can suggest is, if you have an interest in following what is going on in a property market, be wary of, or even totally ignore, short-term fluctuations, stick with a single data source and try to stay focussed on the big picture. Maybe check out the chart library which has just been updated.
May the force be with you.
An ongoing collection of thoughts, opinions, observations and recommendations by long time property analyst and commentator Brett Johnson.