Asking Price Index
The Asking Price Index for commercial real estate tracks sale and rental prices in Australia’s major capital cities.[lower-alpha 1] The methodology which has been granted an Australian patent 2018101348, uses filtering, weighting and smoothing to overcome a universal problem of bias and consistency over time using a price per square metre.[lower-alpha 2] When the advertising real estate agent chooses to hide the price from public display, the price is still included in the calculation.
The Asking Price Index uses online advertising data to track changes in price in commercial real estate. The index removes any bias based on commercial reporting incentives.
Major city data points are aggregated into a national Asking Price Index using a weighting based on each city’s population. The graphical and tabular display is based on the changes for sales and lease results for each capital city and for each property type over the previous three months. The Asking Price Index is often used to support a writer's assertions about the current state of the commercial real estate market. This therefore gives a quantified measure market sentiment.[lower-alpha 3] The accuracy is ensured by the diverse collection of 10,000’s of listings from 100’s of agencies nationally so the impact of any one rogue agent is very small. The change measured over that quarterly period is smoothed on a monthly basis and presented as the Asking Price Index for commercial real estate in Australia. The most common application of the Asking Price Index is as a measure of confidence in the future.
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Sources[edit]
- Bleby, M. (2015, June 24). Commercial rent rises slow at financial year end as agents try to boost occupancy. The Australian Financial Review.
- IP Australia (2018, September). [http://pericles.ipaustralia.gov.au/ols/auspat/applicationDetails.do?applicationNo=2018101348 Australian Government IP Australia Patent Journal.
- Rose, S. (2017, February 21). Great Expectations for Commercial Rent in 2017. Chan and Naylor.
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