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Captain Cavey

Government Investigates House Price Indices

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FT Adviser

The Office for National Statistics (ONS) is investigating the "coherence and comparability" of house price indices after a number of people confessed being confused by the data.

Concerns that different methods for calculating house prices are confusing buyers and homeowners has prompted the goverment to review its two major house prices indices, according to the National Statistician.

A number of different indices are used to measure house prices including two by the government; ones from Halifax, Nationwide and Rightmove as well as a market trends' survey by the Royal Institution of Chartered Surveyors (Rics).

The issue raised is that most of the indices record house prices at different stages of the home-buying process, ranging from asking prices when a property is first put on the market to the price paid at the completion of sale. The data used to compile the indices also differed.

The ONS review will initially focus on house price indices published by the government which should be completed by the of this year. The review will then consider house price statistics more broadly to see how useful they are to the public.

The review was not a response to problems reported by either of the main government indices, said ONS.

Stuart Law, chief executive at Assetz, said the differing pictures produced by monthly house price indices frequently offered a confused picture of the UK property market.

He said: "This is especially true at times of major price correction, when contradictory patterns of positive and negative growth emerge between the indices, as seen several times during the recent recession.

"Property is an illiquid asset and minor monthly fluctuations recorded by a specific organisation cannot be generalised to the sentiment of all homebuyers.

"Even seasonal adjustments recorded by some of the major indices can provide a basis for volatility between the different monthly figures, as these are set at the discretion of the organisation that produces them, leaving room for semantic and political decision making to impact on the data."

Good thing, bad thing or conspiracy? Discuss.

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Could be a good thing? That DCLG seems like the worst of the lot. Erratic massively higher and out if step than the others. Maybe they should start with that one?

Although more than likely some sort of conspiracy to keep them positive and not damage sentiment....

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FT Adviser

Good thing, bad thing or conspiracy? Discuss.

Perhaps the Govt would like to see the house prices going up even when they are on the way down?

It all looks like a complete waste of money and time. OF COURSE there are various ways to look at statistics! I cannot imagine any Govt dept making anything more coherent - probably the reverse.

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So house prices are beginning to fall again and the indices are going to be investigated? <_<

They should have been investigated in 02/03 when house prices were rising at up to 25% at times. Maybe then people wouldn't have been 'pressured' (by relatives, TV, Laurence Llewelyn-Bowen, Krusty, newspapers, banks, own stupidity) into taking out 125% mortgages and maxing out the credit cards because 'soon you won't be able to afford a property. ever.'

Of course that would go against the grain of the NU Liebour and their 'free money for everyone' mantra, but we may not be in nearly as much poop as we are now.

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Even seasonal adjustments recorded by some of the major indices can provide a basis for volatility between the different monthly figures, as these are set at the discretion of the organisation that produces them, leaving room for semantic and political decision making to impact on the data

…although I’m in the unusual and uncomfortable position of agreeing with Stuart Law on this one. :blink:

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Dear Dave,

Whilst you're at it please can you investigate the fraudulent lending and theft of salaries and bonuses from the banks over the last 10 years.

Luv,

Frank

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An index of transaction volumes would add much-needed context to the price data. It could be calculated as a percentage of mid-2000s volumes, that being "normality" ;)

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It couldn't be that now prices are falling, sorry - correcting, sorry - easing, that they don't want the sheeple remind of this 6 or 7 times a month?

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....at present it's a free uncontrolled charter for VIs ....common standards of measurements and auditing of figures need to be agreed ...let's face it ...anyone can say say anything with data unless there is agreement on input / output...after all rubbish in... rubbish out.... and VIs thrive.... :rolleyes:

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  • 149 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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