Which way is property heading?

north, south or sideways?

Well we all know the share market has tanked and the property market is probably off at least 10% and turnover even more. But what is it with the property market? There is and has always been so much disinformation about the real state of the real estate market. We hear a lot about auction clearance rates. What are you meant to read into a clearance rate of 82% now down to 57%. Where's the real barometer of property prices like the ASX and share price futures index which gives live data feeds minute my minute, second by second on prices and volume. The public is out of luck when it comes to property. The property buying public is craving for smart up to date property information such as property price indexes, suburb by suburb, sector by sector, property by property. The conspiracy theory is agents like it this way and dont want such market information in the hands of the public. There wouldn't be much reason to have agents otherwise. Excellent property data valuation is available, and its available instantly. Valuation data by suburb, by street, even individual property is available and tracked but its not freely available. Such valuable data is available to subscribers only. No prize for guessing who pays.

The traditional government reported data is just way out of date. Reliable and accurate data from the Land Registry is several months old by the time it is published. Hardly relevant except from a historical rear view perspective. But again the government data is not readily published. No, its packaged onto a CD and sold. You can generally pick up the quarterly CD for around $50+.

When the property markets are going up, everyone is talking the market up. But when markets are pointing south, the talk is a lot less subdued, and always a number of commentators are still talking the market up. My argument is I just dont know what's happening. I can look at the ANZ Bank share price or BHP or any stock and I can see todays price, yesterdays price, look at New York overnight and have a pretty good idea which way ANZ or BHP will be heading for the day. We all know its not quite the same with property, but there is a world of difference between the market reporting of shares vs property.

Does it matter? It seems to matter to the governing regulators of the ASX that companies have to comply with their obligations of continual disclosure of market sensitive information. But that hasn't stopped the equity markets crashing!

The question remains. What would happen if quality property valuation data was readily, instantly and freely available to everyone? What affect would it have on the real estate industry for general real estate agents and for that matter for panel valuers to the big banks? For that matter, would property start to be traded online?

That said, it is not hard to see all sectors of the property industry colliding and meshing on the internet.

• Property trading online
• Vendor Disclosure online
• Contracts digitally exchanged online
• Real time property valuations
• Mortgages digitally signed by clients
• Conveyancing online
• Property settlements online
• National property registration online

The selling models and technical tools to trade property online have been around for years whether by auction or bid / offer. For any online selling model to succeed the vendor and buyer still require

1. Access to quality up-to-date valuation property data;
2. Instant access to all valid legal information, title search, plans, covenants, planning, outgoings, building reports etc;
3. Ability to enter into a legally binding contract and security of payment of deposit; and
4. the option for vendors and buyers to engage professional advisors to represent them in the negotiation phase

The missing ingredient is undoubtedly the public does not have ready access to quality valuation data. The problem is the organisations that own and collect this data and provide the key reports are not charities. That said, in the US companies such as zillow.com are providing free real estate information including homes for sale, comparable homes, historical sales and home valuation tools. Have a look at this spacial view of price changes in the US over the last 12 months. It clearly shows how California and Florida have tanked 20% over the last 12 months. Link to zillow market report

In respect to the legal information being conveyed electronically, well that is exactly what 247legal does. 247legal carries on the business of digital conveyancing services to the Australian legal and conveyancing industry - online vendor disclosure, digital contracts and electronic settlement services to the legal and finance industry.

Its a lots closer than we think or in other words it is simply just a matter of time.