Calculating 'Adjusted' Rand / Square meter
One of the big challenges in analysing property is to establish a method of comparing apartments with houses, and indeed houses with small gardens to those with large gardens. If one simply uses the ERF size to establish a Rand per square meter (R/m2) rate, homes with large gardens appear vastly discounted, to the point where Bishops Court (a very affluent suburb with large gardens) appears to be one of the cheapest areas to buy. Similarly, the use of only the dwelling size to calculate a R/m2 rate, while appropriate for apartments, results in homes being significantly over-priced, as the price of their gardens is included.
To overcome this hurdle and to ‘compare apples with apples’, we have utilised an ‘adjusted’ R/m2 rate, where the price of homes have been discounted by the size of their garden, valued at the relevant price of vacant land in the area. This discounted price is then divided by the dwelling size to establish the ‘adjusted’ R/m2 rate. Throughout this website, the R/m2 prices referred to are the ‘adjusted’ prices, unless otherwise particularly stated.
It should also be noted that the sale prices used are the final sale prices, and not the advertised or ‘listed’ prices.
To overcome this hurdle and to ‘compare apples with apples’, we have utilised an ‘adjusted’ R/m2 rate, where the price of homes have been discounted by the size of their garden, valued at the relevant price of vacant land in the area. This discounted price is then divided by the dwelling size to establish the ‘adjusted’ R/m2 rate. Throughout this website, the R/m2 prices referred to are the ‘adjusted’ prices, unless otherwise particularly stated.
It should also be noted that the sale prices used are the final sale prices, and not the advertised or ‘listed’ prices.