We live in the information age. That affects every industry including real estate. It’s important to understand how you can use data to your advantage.
Demographic data is crucial in the real estate market. Understanding demographic data helps you to determine the right target audience for a property. You can then use that information in your sales and marketing campaign.
Targeting the right potential buyers will help you to sell a property for the best possible price in the shortest possible time. That’s because you can focus on the selling points of the property that you know will appeal to that particular group of buyers.
What is demographic data?
Demographic data includes any statistical data about the characteristics of the people living in a specific area. For example, basic demographic data includes the average age, income occupations of people living in a suburb.
This type of information helps to give you a profile of a suburb and the type of people that live there. When you have a property listing in an area, you can then use that information to target potential buyers who have similar characteristics. People tend to like living in areas with people who have similar lifestyles. Or if they’re looking to buy an investment property, they’ll be looking for suburbs where they’ll be likely to attract high-quality tenants who want to rent in that area. Using real estate data is the surest way of knowing exactly what type of buyers to attract and sell to.
For example, an analysis of the demographic data for the suburb of your listed property might reveal that the average person living there is a young professional on an above average income. Or it might reveal that the average resident is a ‘baby boomer’ who is either retired or approaching retirement. Either way, knowing the demographic characteristics of the area will help you to identify the most likely potential buyers of the property you’re listing. You can then target your sales and marketing efforts accordingly.
Where can I get detailed demographic data?
You can get plenty of real estate-specific data online. In addition, Australian Bureau of Statistics census data can help you to dig even deeper when profiling a suburb. For example, you can find out useful information for any suburb such as:
- the type of housing (e.g. the percentage of free-standing houses, units/apartments or townhouses).
- the size and composition of households (e.g. the percentage of people living alone, childless couples and families).
- the proportion of dwellings that are owner-occupied versus rented.
- the population and whether it’s growing.
You can also find useful suburb data on the homesales.com.au suburb research tool.
Here you can find the suburb’s population, average income, the median house price and its fluctuation over the years. homesales.com.au’s suburb profile also tells you how long houses in the area have taken to sell and how many houses have sold in the last year as well as vacancy rates, unemployment rates and local amenities.
You can then use any relevant information in your sales and marketing campaign for a property that you’re listing in the area. For example, when the population of a suburb is growing, that’s a good sign that the capital growth potential for that suburb is good. It’s more likely that the facilities and infrastructure in the area will grow as well.
How will changing demographics affect the real estate market?
It’s also important to understand that demographics change over time. These changes affect real estate values. Two of the most significant demographic shifts that are occurring in Australia (and many other countries around the world) at the moment are:
- the ageing of the population. Thanks to advances in medical technology, people are living longer.
- smaller family sizes. Couples today tend to have fewer children than past generations.
These demographic trends affect the size and type of properties that people want to buy. They also affect the type of new properties that are being built. For example, the number of units and townhouses has increased significantly in recent decades to cater for smaller household sizes.
It’s important for real estate agents to monitor these trends and to use them as selling points for relevant properties that they’re listing. For example, where once a smaller property might be seen as a negative, it could be perfect for the growing number of single people and childless couples.