Reply To: How can you predict the future, surely no one can do that?

Home Forums Property Market Research Q&A How can you predict the future, surely no one can do that? Reply To: How can you predict the future, surely no one can do that?

#26109
AlexAlex
Keymaster

Good question, Matt.

Whether or not the forecasts result in a “self-fulfilling prophecy” will depend on their adoption rate. Whereas almost everyone uses Google Maps, it’s unclear whether the same will happen with data and property transactions. Investors and real-estate professionals largely rely on data before locking in their purchases, however a large portion of transactons are still by owner occupiers who make their decisions based on a “feeling” and are limited only by their budget.

I suscpect that the “sentimental” nature of these transactions is actually the main driving force for the property market cycles. In other words if everyone made decisions with their heads, purely based on data, the cycles may have evolved in a different manner (or completely dissapeared i.e. became white noise). That, by the way, would have had an impact on the model’s ability to forecast, given that it takes cycles into account.

In summary, it is unlikely that the forecasts will create a feedback loop into the property market. That would require mass adoption of data-driven decision making, which is qustionable in the owner occupier segment that is the largest buyer group in the market.