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Page 1: SAMPLE - Residex...To do this, the Residex research team have: Collected anecdotal information from real estate agents actively selling in each area. Talked to property managers about

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Page 2: SAMPLE - Residex...To do this, the Residex research team have: Collected anecdotal information from real estate agents actively selling in each area. Talked to property managers about

This Report is created by Residex Pty Ltd, ACN 003 000 119, Level 21, 2 Market Street, Sydney NSW 2000

The Parties* making this report available to you give no warranty nor accept any liability for any decision based wholly or in part on this

report, such as any decision to invest in, to buy or not buy property described herein. The Parties believe the statements, information,

calculations, data and graphs contained herein to be correct and not misleading but give no warranty in relation thereto and expressly

disclaim any liability for any loss or damage which may arise from any person acting or deciding not to act partly or wholly on the basis

of any such statements, information, recommendations, calculations, data or graphs.

Residex is subject to Privacy Legislation, including the National Privacy Principles ("NPPs") under the Privacy Act 1988 (Cth), The

Privacy and Personal Information Protection Act (1988) and contractual requirements relating to Privacy pursuant to a number of State

and Territory Government Licence Agreements.

Material published in this report is protected by the same laws of copyright which apply to books, videos and music. The right to 'copy'

always remains with the owner of the material. Unless expressly stated otherwise, you are not permitted to copy, republish or alter

anything you find in this report without the express permission of The Parties. By using this report you are have agreed to the terms

above.

* "Parties" means Residex Pty Ltd, their customers and clients, and the customers and clients representatives.

Residex is now owned by CoreLogic, Australia’s largest provider of property data and analytics.

This report uses data for the quarter ending July 2015

NSW Data:

Residex Pty Ltd is authorised as a Property Sales Information provider by the Department of Finance and Services, Land and Property

Information. The information provided in this report contains property sales information provided under licence from the Department of

Finance and Services, Land and Property Information. Issue date: 4-9-2015

ACT Data:

Information provided for the Australian Capital Territory properties has been developed in part by using some property information

(Territory Data) provided under licence by the Government of the ACT. Copyright in any of the sales information used belongs to the

Government of the ACT and while every effort is made in its compilation, the Government of the ACT does not accept any

responsibility for the accuracy or completeness of the information or its suitability for any purpose.

The Territory Data is the property of the Australian Capital Territory. No part of it may in any form or by any means (electronic,

mechanical, or micro copying, photocopying, recording or otherwise) be reproduced, stored in a retrieval system or transmitted without

prior written permission.

Enquiries should be directed to: Director Customer Services ACT Planning and Land Authority GPO Box 1908 CANBERRA ACT 2601

VIC Data:

To the extent that this report has been developed using information owned by the State of Victoria, the State of Victoria owns the

copyright in the Property Sales Data which constitutes the basis of this report and reproduction of that data in any way without the

consent of the State of Victoria will constitute a breach of the Copyright Act 1968 (Cth). The State of Victoria does not warrant the

accuracy or completeness of the information contained in this report and any person using or relying upon such information does so on

the basis that the State of Victoria accepts no responsibility or liability whatsoever for any errors, faults, defects or omissions in the

information supplied.

QLD Data:

Information provided for Queensland properties has been developed in part by using some property information provided under licence

from the State of Queensland (Department of Environment and Natural Resources Management). In consideration of the State

permitting use of this data you acknowledge and agree that the State gives no warranty in relation to the data (including accuracy,

reliability, completeness, currency or suitability) and accepts no liability (including without limitation, liability in negligence) for any loss,

damage or costs (incurred consequential damage) relation to any use of the data. Data must not be used for direct marketing or be

used in breach of the privacy laws.

SA Data:

Information provided for South Australian properties has been developed in part by using some property information provided under

licence. Residex is required to make the following statements with respect to any information that is in turn provided to you by this

website:

WARNING: The information contained in this dataset is extracted from records of land status and cadastral boundary definition held by

the Government of the State of South Australia (the 'State'). The information is not represented to be accurate, current, complete, or

suitable for any purpose, at the time of its supply by the State, and may have changed since the date of supply by the State. The

software by which the information is provided is not represented to be error free. No responsibility is accepted by the State for any

reliance placed by any person upon the information, or the software by which it is provided. Persons acquiring or using the information

and its associated software must exercise their independent judgement in doing so.

COPYRIGHT: Copyright in the information remains with the Crown in right of the State of South Australia. The information is reproduced

under licence from the Crown.

PRIVACY: The information contained in this dataset must not be used for the purposes of compiling contact lists, whether personalised

or not.

WA Data:

Information provided for Western Australian properties has been developed in part by using some property information provided under

licence from the Western Australian Land Information Authority (Landgate).

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COPYRIGHT

Copyright in all Landgate information and products (including data, pages, documents, maps, online graphics, images, web pages, audio

and video) is vested in Landgate and is protected by the Copyright Act 1968. Apart from any use as permitted under the fair dealing

provisions of the Copyright Act 1968, all other rights are reserved, and no information and products or part thereof may be reproduced

by any process, distributed, commercialised or reused for any other purpose without the prior written permission of Landgate.

DISCLAIMER

This Information is made available on the understanding that Landgate is not rendering professional advice. While Landgate and has

made every effort to ensure the accuracy, reliability, completeness and suitability for purpose of the information presented, Landgate

does not give any guarantee or take any responsibility or accept any liability (including without limitation, liability in negligence) arising

from or connected to any errors or omissions. Landgate accepts no responsibility and disclaims all liability for any losses, damages or

costs as a result of the use or reliance on the information. Reliance should only be placed on the original source documents held at

Landgate. It is strongly recommended that users exercise their own skill and care with respect to the use of the information, and before

relying on the information that users should carefully consider its relevance to their purpose and obtain any professional advice

appropriate to their particular circumstances. The Information may be subject to privacy legislation and contractual restrictions and must

not be used for direct marketing of goods and services or be released to any person or third party for the purpose of direct marketing of

goods and services. Landgate takes no responsibility for any breaches of privacy legislation by any person in relation to the information.

TAS Data:

Information provided for Tasmanian properties has been developed in part by using some property information provided under licence

by the Real Estate Institute of Tasmania. Copyright in the sales information used to undertake the statistical calculations belongs to the

Real Estate Institute of Tasmania on behalf of its members and while every effort is made in its compilation, the institute does not accept

any responsibility for the accuracy or completeness of the information or its suitability for any purpose.

NT Data:

Information provided for the Northern Territory properties has been developed in part by using some property information provided under

licence by the Department of Infrastructure, Planning and Environment of the Northern Territory. Copyright in any of the sales information

used to undertake the statistical calculations belongs to the Department of Infrastructure, Planning and Environment of the Northern

Territory and while every effort is made in its compilation, the Department does not accept any responsibility for the accuracy or

completeness of the information or its suitability for any purpose.

Copyright © 2015

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www.residex.com.au ©2015 Page | 1

ABOUT THIS REPORT 3

DARWIN AT A GLANCE 9

CANBERRA AT A GLANCE 15

SYDNEY AT A GLANCE 27

MELBOURNE AT A GLANCE 39

BRISBANE AT A GLANCE 51

Contents

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*Suburbs in NT
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*Suburbs in ACT
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*Suburbs in NSW
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*Suburbs in VIC
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*Suburbs in QLD
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ADELAIDE AT A GLANCE 91

PERTH AT A GLANCE 127

HOBART AT A GLANCE 131

ABOUT RESIDEX 136

HOW TO USE THIS REPORT 137

WHERE RESIDEX GETS ITS FIGURES 138

RESIDEX PRODUCT RANGE 140

ORDER FORM 142

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*Suburbs in SA
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*Suburbs in WA
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*Suburbs in TAS
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Residex believes that the best guide to the future is the past. The past is the only guide we have and

without it, suburbs may as well be randomly selected from across Australia.

Residex research shows that a process of selection based on past population behaviours is a good

predictive process. The total population is always involved in housing one way or another and people

seem to react to events similarly in different time periods.

Residex statisticians have:

Built and maintained the most comprehensive residential property database in Australia,

collecting and analysing sales results for every property in Australia.

Developed unique forecasting methodologies that identify patterns in each suburb's housing

history and show how these patterns are likely to act in the future.

Built predictive models that tell us where historical patterns will play out and when this is likely to

occur.

This Report combines methodologies and models with Australia wide housing data to identify suburbs

and towns that contain opportunities for achieving a total return greater than 8 per cent, where statistical

models show there is a reasonable chance of good future capital growth of at least 3 per cent per annum

on average over the next eight years plus a current rental yield of 5 per cent or more.

To do this, the Residex research team have:

Collected anecdotal information from real estate agents actively selling in each area.

Talked to property managers about local rents and vacancy periods.

Contacted local government bodies and other authorities, organisations and associations with

an interest in or knowledge of the housing market and its potential future in each locality.

Selected only those suburbs with the lowest risk and highest potential return that have good

anecdotal evidence supporting our statistical forecasts.

It is important to remember that there is always a degree of risk involved with investing in property hence

there is risk associated with investing in any of the areas detailed in this Report. In order to minimise the

risk involved, it is important to understand how the numbers in this Report are calculated, how to interpret

them and the limitations involved in all the methods used. To do this, it is strongly recommend that you

read the various sections of this Report very carefully to gain an understanding and received the full

benefits of this Report.

Wishing you successful investing,

The Residex Research Team

We welcome your suggestions or enquiries. Please email them to [email protected].

About this Report

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1. How are the suburbs selected for this Report?

There are around 8,300 suburbs and towns with houses in Australia and another 3,800 containing units,

making well over 12,000 in total. The initial task was to reduce these to a list of areas that have a total

return of greater than 8% per annum.

Then, suburbs were subject to further filtering based on affordability and historical growth. Suburbs where

there were few or no property sales in the last year were culled followed by removing suburbs that had a

critically low number of rental properties, which would be of little value to investors.

Lastly, anecdotal information from real estate agents actively marketing and providing property

management services for residential properties in each area was collected to identify the current state of

the market, including rental yields, house price growth, available stock, turnover, typical vacancy periods

between rentals, typical rents and property prices.

Researchers also contacted local government bodies and other authorities, organisations and

associations with an interest in or knowledge of the housing market, the local economy and its potential

future in each locality. They were asked what factors were driving up rental yields and growth, or what is

likely to have an impact on future yields and residential property sales. Any factor that may have an

adverse effect on the growth predictions and increase the risk to investors was also questioned.

What were left are the suburbs that feature in this report, which have the lowest risk ratings coupled with

the highest expected return.

2. What do the figures mean in the suburb summary?

3. Important facts

It is important to remember that units and houses do not perform equally. If a suburb is recommended for

houses then don’t assume an investment in units in that suburb will be an equally good bet. Historically,

there have been very few suburbs where both houses and units meet the selection criteria for this report.

The prediction process is based on past data, that is, past sales. Hence, no prediction in this publication

is recommending a purchase of a brand new property. Each and every prediction is made with respect to

the future growth of an existing property that has been sold at least once before and purchased at a price

in line with its true market value.

In other words, Residex is definitely not recommending purchasing a property in a new large block of units

unless you have confidence in the price you are being asked to pay. It is extremely difficult to correctly

price such properties in this market and hence it is recommended that they are not purchased if capital

growth is the prime objective.

Number of Sales

Residex Median Value

Residex Median Rent

The rental yield in the suburb

Average Annual Capital Growth Predictions

How many times the median

annual income in the suburb

is needed to purchase the

median home or unit in the

suburb

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There is a key message in the above: it is not possible to achieve predicted returns if the purchase price

paid for a property is higher than its market value. If you pay too much you are effectively giving the seller

some of the proceeds you should be receiving when you sell the property. An excellent guide to

establishing the worth of a property is by purchasing our Comparative Market Analysis Report.

This is a market for the investor with available funds as there are sellers who are frightened and

uninformed. Your negotiating skills have the capacity to make you the winner in this market.

4. How do I use this data?

It is strongly recommend that in whatever area you decide to consider for investment, and particularly

when you are selecting a regional area, that you do your homework and consider such things as:

Financial Trends Are interest rates likely to rise or fall, and if they rise, will this slow the growth

rate of your selected area and will your level of proposed debt be serviceable into the future?

The Economy What is driving the local economy? Are there new primary (e.g. mining, agriculture),

secondary (e.g. industrial, construction) or tertiary (e.g. education, tourism) projects underway or in the

pipeline?

The Population What is the population composition and growth rate, local employment prospects and

what are the implications for the housing market?

The Housing Market Establish for yourself the current number of listings and sales in your chosen

suburb or town. This information is readily available from www.onthehouse.com.au including an

independent price estimate for every listed property, powered by Residex’s patented technology.

For many places, you will need to wait and maintain vigilance for purchase opportunities. Given the

increasing scarcity of well-located quality yielding properties, it will be the vigilant and considered investor

who succeeds. Talk to the local council. They will be able to tell you the name of the local paper and whom

you should contact to get a copy. They also may have a local publication that will help you understand the

potential or lack of it in the area. Talk to local real estate agents, and register to receive notification as

soon as properties in your selected areas and price range come on the market.

Finally, don’t forget to check out the areas surrounding your selected suburb as often these surrounding

areas will also present the required opportunity.

5. What is the median value?

In this Report, the “median value” for an area is provided rather than the median sale price. Some

confusion has arisen over these two figures. What is the difference?

Residex has calculated a statistical value for every property in a suburb and it is the median of these

values that is used because it takes into account all of the properties in an area, not just the ones that

have recently sold.

6. How is rent affordability calculated?

The median weekly household income for each suburb comes from the 2011 ABS Census. This figure is

indexed each quarter as the updated ABS Australia Weekly Earnings (AWE) Index becomes available.

The after tax affordability percentage to make rent repayments is calculated assuming a tax rate of 17.5%

and uses the Residex median rental figure.

i.e. Median Weekly Rent / (Median Weekly Household Income – 17.5%)

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7. Why is the agent’s typical sale price sometimes

higher or lower than our median value?

In suburbs where more sales are occurring at the higher end of the price spectrum, the agent’s typical

sale price may well exceed the Residex median value and the reverse can be true if sales are occurring

at the lower end of the market. By providing both figures, you can see the “true” median value and use

this information in your research.

8. Disclaimer:

Residex has developed this report for the general public. Neither Residex Pty Limited nor any of its

employees gives any warranties nor accepts any liability for any decision with respect to investment or

non-investment, sale or purchase of residential property that is made as a consequence of the use of this

report. Residex Pty Ltd believes the statements, information, recommendations, calculations, data and

graphs contained herein to be correct and not misleading but give no warranty in relation thereto and

expressly disclaims any liability for any loss or damage which may arise from any person acting or deciding

not to act partly or wholly on the basis of any such statements, information, recommendations,

calculations, data or graphs.

9. Copyright:

You are entitled to hold a single copy of this report, which has been provided to you directly from Residex

Pty Ltd. You are not entitled to make copies of the report or extract data from this report and use it in

publications that you produce. If you are considering using this report beyond personal use in any way or

form, please seek guidance from Residex. Please note that Residex Pty Ltd will take legal action against

any party that wrongly uses the data it provides.

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Acknowledgements:

The use of statistical information from the following publications is acknowledged:

Australian Bureau of Statistics

3101.0 Australian Demographic Statistics

8750.0 Dwelling Unit Commencements

8731.0 Building Approvals Australia

6202.0 Labour Force Australia

1301.0 Year Book Australia

5609.0 Housing Finance Australia

5671.0 Lending Finance Australia

8501.0 Retail Trade Trends Australia

Other Acknowledgements

NSW Government – Metropolitan Strategy Plan for Sydney’s Future

Victorian Government – A Plan for Melbourne’s Growth Areas

Queensland Government - SE QLD Infrastructure Plan and Program

South Australian Government – South Australia’s Strategic Plan

Tasmanian Government – Launceston City Council Strategic Plan

ACT Government – The Canberra Plan, Towards Our Second Century

WA Government – Perth 2029 – Four Year Strategic Plan

Housing Industry Association – State and National Outlooks

Economics ANZ - Economic Outlooks

National Australia Bank State Economic Updates

Bureau of Meteorology - Rainfall Deficiencies and Temperature Anomalies

Dept. of Immigration and Citizenship – Immigration Updates

ABARE Australian Commodity Statistics

National Housing Supply Council State of Supply Reports

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Darwin at a Glance

Houses and Units Combined

The median value of Darwin properties as at 31/07/2015 was $507,000

The overall rate of growth for Darwin property was -1.41%

Darwin Houses

There were 1,326 house sales in Darwin

during the last year.

Capital growth in the Darwin housing

market over the last year was -2.85% and

the Darwin median house value is now

$561,500.

The Darwin house median rental yield is

5.40% p.a. and the median weekly rent is

$580.

Current Quarter Future Predictions

Median Value: $561,500 Capital Growth: 0.71% 4% p.a. next 5 yrs

Number of sales: 336 Rental yield: 5.40% p.a. 4% p.a. next 8 yrs

Median rent: $580/wk Total return: 2.09%

Darwin Units

There were 557 unit sales in Darwin during

the last year.

Capital growth in the Darwin unit market

over the last year was -6.41% and the

Darwin median unit value is now $404,500.

The Darwin unit median rental yield is

5.80% p.a. and the median weekly rent is

$450.

Current Quarter Future Predictions

Median Value: $404,500 Capital Growth: -3.31% 2% p.a. next 5 yrs

Number of sales: 119 Rental yield: 5.80% p.a. 3% p.a. next 8 yrs

Median rent: $450/wk Total return: -1.84%

$0

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

Median Value - Darwin Houses

Median Value - Darwin Houses

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

$500,000

Median Value - Darwin Units

Median Value - Darwin Units

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Stuart Park Units (0820)

Sale Count Last 3 Months 12

Median Value $468,000

Median Rent $515

Median Rental Yield 5.76% p.a.

8 Year Growth Predictions 3% p.a.

Affordability Factor 4.82

Location

Stuart Park is a suburb of Darwin, located approximately 2.5 km north of the Darwin CBD. Stuart Park is

surrounded by the inner suburbs of The Garden, Fannie Bay, Ludmilla and Parap.

Description

Predominantly a residential suburb, Stuart Park is an inner suburb of the city of Darwin. Stuart Park is a

suburb that is rich in history. Residential properties within the suburb are diverse, many of which have

beautiful, waterside views, and the majority of which consist of two to three bedroom units, and three to

four bedroom double storey houses. Units in Stuart Park come in a range of ages and styles. Despite the

relatively small size of Darwin when compared to other major cities in Australia, units are sought after in

Stuart Park because they provide an ideal location between the sea and the city.

Stuart Park is seeing new developments in housing, with the Northern Territory Planning Commission

developing area plans for Darwin’s inner suburbs. These developments will be expanding over a period

of short-term and long-term plans, detailing changes from 10 to 50 years in the future. Development will

encompass housing, traffic and infrastructure developments for the suburb of Stuart Park and its

neighbouring suburbs, according to local news sources.

Facilities

Stuart Park is home to several retail outlets, including food, fashion, and boat stores, as well as

supermarkets. The suburb is also home to several health-care facilities.

Adjacent to Stuart Park is the suburb The Garden, home to the George Brown Darwin Botanical Gardens,

Mindil Beach Reserve, and Cullen Bay. The Garden also contains several other facilities including the

Museum and Art Gallery of the Northern Territory, the Tactile Arts Gallery and Studios and the Darwin

Amphitheatre.

Stuart Park is a great area for young families to settle, with a day care centre and a primary school located

in the north of the suburb. Home to two local parks and a cricket oval, residents can also enjoy outdoor

leisure benefits of Stuart Park.

Industry and Employment

Stuart Park residents are exposed to an abundance of employment opportunities with the Darwin CBD

located close by, and local industries in surrounding suburbs providing employment. The tourism industry

employs many residents in the nearby areas, with several motels, hotels, and resorts within and encircling

Stuart Park, in the suburbs of Darwin, The Garden and Parap.

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The Northern Territory Development Consent Authority has received several proposals for construction projects in Darwin. These proposals include the construction of a $100 million hotel at Stuart Park, and a $96 million six-storey high motel on Stuart Highway, comprised of 62 rooms. In this proposal, Northern Planning Consultants principal Brad Cunningham claimed there is an increasing demand in the area for accommodation that had not been previously met.

With the numerous proposals awaiting development, many residents of Stuart Park will find employment

opportunities in the construction sector, in trade and technical work, as labourers, machinery operators,

managers and administrators. The new developments in Stuart Park will also accommodate for tourists

and visitors, as well as population growth.

According to the Australian Census of 2011, residents of Stuart Park are mainly employed as

professionals, clerical staff and administrative workers. This is due to the numerous medical and health

clinics nearby, as well as the many government offices and council departments in Stuart Park and Darwin.

Population and Income

At the time of the 2011 Census there were 3,749 residents in Stuart Park, which is a 7.33% increase from

the previous Census. The median age of the people in the suburb was 32 years old and the predominant

age group was 25 to 29 year olds, which accounted for 15.66% of the population. Children aged 0 to 14

years old made up 12.43% of the population while 6.16% was aged 65 years and older. There were 850

families in Stuart Park with an average of 1.7 children per family. Of the families, 33.53% were couple

families with children, 52.12% were couple families without children and 11.06% were one parent families.

The weekly household income in Stuart Park is $1,866. It currently takes around 33.45% of after tax

income to make rent payments on the median rental property.

Housing Market

At the time of the 2011 Census, there were 1,632 dwellings in Stuart Park, of which approximately 46.88%

were houses and 54.50% of all dwellings were rented. Today, Residex calculates that there are

approximately 2,533 dwellings in the suburb. According to local agent, Jan Hallagan from First National

O’Donoghues (0403 246 256), rental vacancy is approximately 4 weeks. According to Matt Englund of

Ray White Darwin (0417 866 821) the typical weekly rent is around $480 to $520, with usual purchase

prices around $460,000. Based on these figures the rental yield is approximately 5.67%. The historical

long term 10 year growth rate was 5.77% p.a.

Rental Yield & Median Rents Last 5 Years

Rolling Yearly Capital Growth & Median Values Last 5 Years

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Residex Pty Limited was founded in 1990, by John Edwards. Its founding goal was to understand

residential property markets and inform the public and professionals. It was the first company of its kind

in Australia to analyse the residential property market. It is dedicated to providing quality information on

the real estate market to governments, financial institutions, valuers, real estate agents, accountants,

solicitors and individuals.

Residex collects data from all State and Territory Government Departments and compiles it into a unique

database. Representations by Government Departments mean it is believed that Residex has nearly every

New South Wales sale record since 1978 and every Queensland sale record since 1990. Prior to this time,

Residex has significant sample data going as far back as 1901. The unique Residex database cannot be

matched by any public or private organisation in terms of accessible historical data.

Residex provides information on all aspects of the real estate market, not just relating to price. Rental

yield data, growth in prices, analysis of market movements, mortgage design, financial transaction

structuring, raising and placing of funding facilities, loan risk profiles, statistical consulting and research

are all available.

The company is a consultant and adviser to State and Federal Governments on housing related issues

including the development of financial instruments to provide funding for housing needs.

Residex is the only company in Australia to have won international actuarial recognition for its work in the

development of a definitive measure of capital growth in the Melbourne Residential Markets.

Residex is now owned by CoreLogic, Australia’s largest provider of property data and analytics.

About Residex

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Dataset What is it? What does it tell you?

Median Value

Every quarter, Residex calculates a value for every property in its database. The middle value is found (i.e. middle number when all the values are arranged in order), which is the median value.

The median value tells you straight away what a typical house is worth in an area. By knowing the cost of a typical property in the area, you can tell fairly quickly which areas you can realistically afford to invest in.

Number of Sales

The number of sales figure is the number of sales we receive over a time period from the government after we have taken out any sales that are too high or too low to be useful. In areas where we have not yet received all that quarter’s sales from the Government, we have published an approximate number of sales.

If there is a high number of sales in an area, this tells you: a) That the area is fairly busy and seesa lot of sales activityb) How confident you can be in theResidex figures, because the moresales we have, the more data has beenused to calculate growth, medians andother data.

Median Rent The median rent is calculated from various sources of weekly rental information such as newspapers and the internet.

The median rent tells you the typical amount of rent per week you can expect to earn in an area.

Capital Growth

The capital growth is the growth in house prices over a period of time. It is sometimes quoted for the latest quarter, and sometimes the average is given for the last 10 years.

The capital growth is the amount by which your investment grows in value. By following the growth in an area, you can find out what your property should be worth or how an area is performing.

Rental Yield

The rental yield is the amount of rent you can expect to receive in a year, expressed as a percentage of a property’s value. Unlike capital growth and total return, which are quarterly figures, rental yield is an annual figure. Note: Users should exercise caution when evaluating very high or very low long-term average yields.

The rental yield gives you an idea of how much rental income you can make in an area. For example, if an area has 5% rental yield and a property in that area is worth $500,000, then you should be able to make $25,000 ($500,000 x 5%) worth of rent in a year or approximately $480 a week.

Total Return A combination of both capital growth and rental income.

If you have been renting out your investment property, the total return figure tells you what your return is from both the growth in house price plus the cash flow from the rental.

Median Income

Median Income is based on the median household income figure for the specified suburb at the time of the last Census. This is updated each quarter with the latest Average Weekly Earnings (AWE) index.

Median income allows you to measure affordability in the suburb.

Affordability Factor How many times the median annual income in the suburb is needed to purchase the median home (or unit) in the suburb.

Affordability of properties in the suburb allows you to determine the purchasing power of residents in an area.

Rental Affordability

The percentage of after tax income used to make rent repayments. This is calculated based on the median rent rate and the median income of the suburb.

Rental affordability helps investors to determine rents for a property, based on the income capacity of potential tenants in a suburb.

How to use this Report

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Residex has an extensive and ever-growing database of sales information on the Australian property market. Every month, we receive sales information from various state government sources and our statisticians put the data through a detailed process of cleaning, sorting and analysing before it is released in reports such as this one.

What makes Residex figures unique is our approach to calculating property price growth (or capital growth) and then predicting that capital growth into the future.

The Non-Revisionary Total Market Methodology and

Residex Dwelling Price Trading Indexes

Residex first developed the Repeat Sale methodology of index calculation in the early 1990s. Previously, the only way to measure how an area (such as a suburb, postcode or region) had grown was to look at the raw median sale price of all the properties that had sold in one time period and then compare them with the median price of the properties that sold in the next time period.

The problem with this is that if cheaper properties sold in the first time period and more expensive properties sold in the second time period, you would be comparing a low median price in the first period with a high median price in the next period. While this was adequate for a rough guide, if you were trying to estimate how your property had grown over that time period, you could easily make a mistake.

At the time, there was no adequate measure in existing statistics to cover this situation, so Residex developed its own.

We realised that the problems were caused by comparing one group of houses in one time period with another group of houses in another time period. Wouldn’t it be better to see how each house individually had grown over time? When a property is sold for the first time, we would record the sale price and then when it sold a second time (a repeat sale), we could see how the property had grown over that time period. These two sales for the one property are called a ‘sale pair’.

Residex statisticians took sale pairs for every property where we had at least two sales recorded. So for a large number of properties, we were able to tell exactly how each property had grown over the time period. We then combined these individual property growth rates into a complete growth rate for the area we were looking at. (See the pictures beside for an explanation of how this is done.) This special method developed by Residex gave such outstanding results that we even won an international actuarial award for it.

So far, we have just been discussing the Repeat Sale methodology. Its weakness, like the use of raw median sale prices, is that the figures are subject to constant revision as new data is collected, and it doesn’t cover the entire market. The Median Sale price covers only the portion of the market that sold and the Repeat Sales methodology covers the second-hand market, that is, the portion of the market that has sold at least twice before. While the latter is a huge improvement, coverage of the complete market is preferred. This is exactly what the Residex Dwelling Price Trading Indexes do, as well as being non-revisionary.

The Dwelling Price Trading Indexes were developed late 2005 and are still based around the basic Repeat Sales method, but with additional features that make them more robust and reliable.

As well as considering only the properties that have sold at least twice, we also include new sales in the calculation of the indexes, so they truly cover the entire market. In addition, the indexes are non-revisionary, which means that they never change. The figure that we first come up with is the definitive one for the particular area, time period and dwelling type.

Where Residex gets its Figures

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The non-revisionary total market Residex Dwelling Price Trading Indexes are available for houses and units in the Residex Index Report. The Report is available for a specified suburb, postcode, Residex

Region, Local Government Area or State. Each Report is valued at $95 and is available at http://www.residex.com.au/index-report.

The Residex Prediction Model

The Residex prediction methodology is also unique. How did we work out what the market is likely to do over the next 5 or 8 years?

We started by gathering a lot of information. The Residex statisticians used Melbourne as a good base model and collected information going back to 1901 to analyse how Melbourne had performed over a long time period including the Great Depression, two World Wars, and many other events that could have had a bearing on the housing market. From this century-long series, it became clear that, no matter what was going on in the world, the Australian property market moves in noticeable trends and cycles.

Residex then investigated lots of different factors to see what their bearing was on the property market: interest rates, inflation, employment levels, population, bank bill rates, etc. By combining the results of these studies with our understanding of past trends and history, we were able to develop the Residex predictions.

We are constantly refining our predictions to increase their accuracy. For many years, they have proved to be very good indicators of the property market.

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State Market Reports $90

This quarterly Report is available for each state and territory. It includes key data such as median values, number of sales, capital growth and rental returns at a suburb level for the selected state/territory, along with easy to read tables and graphs. Complete with expert advice and commentary, this Report is designed to make you an expert in property.

Annual Subscriptions are available, which include quarterly Reports and an exclusive Annual Supplement.

Best Growth Predictions Reports from $155

Predictions Reports detail the suburbs that Residex predict to be amongst the highest capital growth performers over the next 5 and 8 years.

Top Predictions Reports select the most likely suburbs for growth and are available for a range of regions. Budget Suburbs Prediction Reports select the most likely suburbs for growth where median property values are under $500,000.

Predictions Reports are a vital pre-selection tool for anyone advising or investing in the Australian property market.

Best Rent Report $250

This quarterly, Australia-wide Report is ideal for an investor looking for a mixture of capital growth and rental return. The predicted total return of suburbs in this Report typically exceeds 10% p.a.

Each suburb is statistically pre-selected prior to extensive research by the Residex team. Not only does this Report give you vital statistics, it also tells you why each suburb makes a good investment area. This is the most intensively-prepared Residex Report, and also features an overview of each state and territory property market.

Annual Subscriptions are available, with four quarterly Reports for the price of three.

Renovator Reports $215 ea

As a market first, Residex has developed two Reports specifically designed to help you build wealth through property renovation.

The Renovators Top 100 Report identifies the best suburbs in a selected area with renovation potential. The Report also tells you the number of streets in each suburb with renovation potential and provides information on future growth and rental returns, ensuring you find the best locations in Australia.

After identifying the right suburb, the Renovators Suburb Report helps you find the streets that offer the best opportunities. This Report is the ultimate tool to price a property and to identify those which are best for renovation. A page is devoted to each street in the suburb, detailing the price structure of the street, if there are renovation opportunities and at what price points opportunities exist.

Residex Product Range

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Postcode Explorer Report from $90

This Report contains a list of sales in a specified postcode that have occurred over the last 12 months. An indexed sale price is included for every sale. This provides a current day value for each property based on the last sale price and the growth that has occurred in the area since the sale date.

For the specified postcode, you receive the median value and rent, historical returns from 1, 2 and 3 years ago, and 5 and 8 year predicted growth rates for the area.

This Report is ideal for those who have selected an area where they want to buy and are looking for an in-depth understanding of values at property-level.

Comparative Market Analysis Report $65

Are you intending to buy or sell a property, or would simply like to know what your property is worth?

This Report includes the sales history of the property, and the recent sale is indexed to today's value. You will also receive a list of comparable sales, 5 and 8 year growth rate predictions, median value and rental returns.

Indices $95

Do you want to better understand housing market cycles?

Residex Indices are available for houses or units at a suburb, postcode, region, Local Government Area or state level. Each Report includes an index for the specified dwelling/area for as long as Residex holds data for.

Delivered as an excel file, Residex capital growth indices are the most accurate measures of capital growth available in Australia.

MarketFacts contact for price

If you are a real estate agent, mortgage broker, valuer, developer, investment advisor or a dedicated private investor, MarketFacts property information software can help you.

MarketFacts delivers best in class residential property data and marketing solutions. Including historical sales data, a property search tool, price estimates, property Reports, calculators and marketing aids, MarketFacts is the ultimate data and marketing tool. MarketFacts can help you get more leads, generate business from your existing clients, increase your loan conversion rates and enhance your professional image.

How to order…

Reports can be ordered online at www.residex.com.au where a sample can be viewed for most Reports. Alternatively, you can call 1300 139 775 during office hours or complete the order form on the next page.

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