Why house prices can go up and down at the same timeMake Text Bigger
The lack of a joined up official and independent house price index for the UK is at the root of some statistical anomalies in recent surveys.
In the space of a few days, landlords, buyers and other property people have been bombarded with numbers that just don’t add up:
- The Nationwide figures for March claim the price of a typical UK house dropped by 1% in March, that prices are 0.9% lower than a year ago and the average price of a home is now £163,327
- Arch rivals the Halifax says house prices increased 2.2% in March, dropped 0.6% in the year and the average price of a home is £163,765
- The Land Registry figures, which lag the others by a month, quote house prices as increasing by 0.1% in February, but down 0.6% in the year with an average home price of £161,588.
So landlords, sellers and buyers rightly ask why do the figures go up and down in the same month and why different surveys quote different values.
All the surveys seem to agree on is that they disagree – and these three are just the most well-known of many monthly house price surveys.
The answer to the riddle of average house prices is in the maths.
None of the researchers use the same database to gather their statistics, so each one is skewed to deliver a different result.
The Nationwide talks of a ‘UK’ figure, but is traditionally based in the South and Home Counties with less of a presence in the North and Scotland which can alter the results.
The Halifax ‘heartland’ is in Yorkshire and the North, while the Land Registry only collates data for England and Wales.
Add to that the National Landlords Association quite rightly pointing out that a ‘typical’ or ‘average’ home does not exist and that even towns and villages have their own micro property markets.
The last Labour government asked for a report on instituting an official property index almost two years ago – that idea seemed to die a death along with their grip on power.
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