SQM Research
On October 5, 2009, SQM Research made two amendments to its Residential Vacancy Rate Series. The impact of these amendments has meant vacancy rates for many of the postcodes monitored by SQM Research have changed.
On October 5, 2009, SQM Research made two amendments to its Residential Vacancy Rate Series. The impact of these amendments has meant vacancy rates for many of the postcodes monitored by SQM Research have changed.
The amendments have been two-fold:
1) Rental listings need to be published for a minimum three-week period before being regarded as vacant. Previously the ruling was two weeks.
2) Secondly, SQM Research has introduced additional sources of listings data.
SQM’s full back series of data has been adjusted to reflect the changes.
Overall there are two main parts to the methodology for SQM’s vacancies, which are: the numerator, being rental listings; and the denominator, being the number of established properties available for rent.
Rental listings
The rental listings component is based on all monitored and unique listings for the period of a calendar month. The series starts off in January 2005.
All listings are taken from online monitoring of major and some minor listings sites. Only those properties with unique addresses are used. Those advertisements with no addresses are excluded from the series unless identified by their unique listing ID. Any addresses repeated between the listing sites are de-duped.
Finally, only those listings that have been advertised for three weeks or more (and are still currently advertised as at the time of collation) are used.
Established dwellings
We use the 2006 number of total established dwellings (as a base) by postcode as determined by the Australian Bureau of Statistics Census. In addition we estimate total dwellings for 2005, 2007 and 2008. We then multiply this by the percentage of renters for each postcode as also provided in the Census. This provides an estimated available total stock for rent.
The numerator is then divided into the denominator, which provides a vacancy rate percentage.
Some have argued that using real estate listings cannot be done because of advertising of false listings and properties that are only advertised for a fleeting moment as they are taken up immediately.
We have addressed those issues.
We have left out those ads without an advertised address and also take into account a whole month’s worth of listings which automatically adjusts for those ads withdrawn quickly.
