Many people talking about property price movements in a given location talk about quarterly or annual averages. But what do averages really tell consumers about property prices?

Many people want to buy an average-priced property because they think that is where the turnover is, and they will always be able to sell quickly if they need to.

And they are almost right. But what they really should be looking at is not the average price for the area but the median price. Many might argue that it’s a fine distinction and in some areas it may well be. But in areas where there are many median-priced property sales and a few very expensive ones thrown in the average is distorted upwards and doesn’t reflect where the sales are.

Experts are generally agreed that the most certain longterm capital gains come from buying property is that which falls at or within 15% of the median price for the area of your choice. The total outlay should include any renovations or extensions.

Not that gains can’t be made by buying in a higher price bracket, but buyers wanting the safest and surest investment, those who want to maximise capital gain and minimise risk should look at properties around the median price for their area. Properties more than 15% above the median for any given area are particularly affected when the market slows. After all, competition is essential for high prices, and oversupply and underdemand occur more quickly above the median price. Even in good times the highest price categories attract the smallest percentage of the buyer pool. And after a lull, the market starts to gather momentum in the median price category first.

If you don’t understand the subtle (and often not so subtle!) difference between average and median, consult an accountant or reputable real estate agent.