Melbourne Median House Price Trends June 2005 to March 2010

What is a Median Price?

The median price is the middle price in a series of sales. For example, if fifteen sales are recorded in a suburb and arranged in order from lowest to highest value, the eighth sale price is the median price. In the case where there are an even number of sales in a series, the median is the average of the middle two prices.

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. The lower quartile is the point where one quarter of the sales are of lesser value and the upper quartile is the point where one quarter of the sales are of a higher value.

Median prices are a guide to market activity, and the REIV does not intend for median prices measures to be regarded as a valuation tool. The assessment of an individual property’s value is a job for a qualified professional, who possesses the knowledge, experience, and comparable sales information required to do so.