What is the median price?
The most recent median prices are available on the REIV website.
The data provides buyers, sellers and anyone with an interest in the real estate market with the most timely and accurate information on the current state of demand and will help them make their own judgements as they decide to buy or sell.
To fully appreciate the information it is important to know what the ‘median’ is.
The median value is the middle price in a series of sales, where half of the sales are of lower value and half are of a higher value. For example, if 15 sales are recorded in a suburb and arranged in order from lowest to highest value, the eighth sale price is the median price.
Median prices are used rather than average prices because median prices are unaffected by a few unusually high or low prices, making them a more accurate indicator of true market activity. It is also the calculation method used by the Victorian Government.
To ensure a high degree of statistically reliability the REIV also makes note of the number of sales in each suburb and makes it clear if there are fewer than required to produce a reliable median. For that reason there is no median published for some suburbs, particularly small ones, as it would not be a reliable indicator.
It is important to know that the median price is simply an indicator and it cannot be applied directly to all homes, as each sale is affected by the property’s unique features and, of course, demand on the day.