Estimates of the total value of the dwelling stock are available in Table 1 and comprise three outputs:
- the mean price of residential dwellings
- the number (or quantity) of residential dwellings
- the total value of residential dwellings (which is an aggregation of the price and quantity components).
For each quarter, we produce a 'first preliminary' estimate which we subsequently revise in the next two quarters. The methods that we use are different. The stratified estimation approach described below is not suitable for producing estimates for the most recent quarter. The method used for the most recent quarter is described separately in this section.
The geographic coverage of dwellings in scope of the value of the dwelling stock consists of all residential properties in Australia. From the dataset provided by CoreLogic, we use only the residential property sales data obtained from state and territory land titles offices or Valuers General offices in estimating the total value of the dwelling stock. Real estate agents' data provided to CoreLogic are excluded.
Stratified estimation approach
We use a stratified estimation approach to estimate the total value of dwelling stock. Price, quantity and value information is stratified by location (in terms of Statistical Area Level 2 in the Australian Statistical Geography Standard) and dwelling type (established houses and attached dwellings).
We obtain a representative price for all dwellings in the stock from information about dwellings sold during the reference period. Price information from dwellings sold is used to represent the price of all dwellings not sold during the period. A quarterly mean dwelling price by geographic area and by dwelling type for all strata is calculated.
The first step in calculating the number of dwellings for each stratum is estimating the number of residential dwellings in each state. The number of residential dwellings is calculated by taking counts of dwellings from the latest Census and adjusting these counts for net additions to the stock since the last Census. These net additions are calculated by taking dwelling completions data from Building Activity, Australia and adjusting the completions data by the long term realisation rate (the long term average rate at which completions result in net additions to the stock).
We pro-rate the total number of residential dwellings calculated at the state level down to each Statistical Area Level 2. As completions data are not available in time for use in compiling the most recent quarter's estimates, and are not available below state/territory level, quantity information for the latest quarter is modelled using historical trends.
To compile the total value of dwelling stock we combine price and quantity data in each Statistical Area Level 2, which is then aggregated up to the state/territory and national level. Information from the Census is used to further break down total value information into Household and Non-Household sector ownership.
Estimation approach for first preliminary estimates
Lags can occur in the transmission of property sales data. As a consequence, there are insufficient property transactions to apply the stratified estimation approach for the most recent quarter. Instead, for the latest quarter, we estimate directly the mean change in property price at the state and territory level. The movement of the CoreLogic Hedonic Home Value Index, for all dwellings, at the state or territory level is used as a proxy for the change at the state and territory level. This method results in estimates that are preliminary for this period.
Before the March quarter 2022, the movement in the ABS’s Residential Property Price Index (at the capital city level) was used as a proxy for movements in the mean price (at the state or territory level) for the most recent quarter. The Residential Property Price Index was discontinued after the December quarter 2021.
The movement of the CoreLogic index is measured between the beginning of month 2 in the latest quarter and the end of month 1 in the following quarter. Measuring the change in the CoreLogic index over this period seeks to account for the lags in transmission of property sales data, and so represent price change for transactions which occurred within the latest quarter. For example, the price index movements used in calculating the preliminary estimate for the March quarter 2022 relate to the period consisting of February, March and April 2022.