As property markets in Australia move in clearly defined stages, a property clock is a useful tool for tracking the stage of each region in the property market cycle.
Property Clock Stages
There are eight stages of a property clock, split across 4 quadrants, these are:
1. Slowdown
a. Starting to decline
b. Declining market
2. Slump
a. Approaching bottom of market
b. Bottom of market
3. Recovery
a. Start of recovery
b. Rising market
4. Boom
a. Approaching peak of market
b. Peak of market
What To Look For and What Next?
“these markets also need supporting economic and property-specific data including but not limited to, population growth, infrastructure spending, employment (job creation), diversification of the local economy, consumer sentiment, vacancy rates, days-on-market, renters/owner occupiers split, stock on market, auction clearance rates, stock on market and rental yields.”
There is no set time frame on how long a market takes to move between stages. As a general rule of thumb, I like to target specific markets in the recovery quadrant phase, however, these markets also need to have supporting economic and property-specific data including but not limited to, population growth, infrastructure spending, employment (job creation), diversification of the local economy, consumer sentiment, vacancy rates, days-on-market, renters/owner occupiers split, stock on market, auction clearance rates, stock on market and rental yields. Each of these indicators affects the property market in a different way.
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