Academetrics Estate Agent Index -0.2%

[Pent Up]

http://www.bloomberg.com/news/2011-01-14/u-k-house-prices-decline-for-a-third-month-acadametrics-says.html

Acadametrices LSL (estate agent) guess that house prices may have possibly dropped by 0.2%

U.K. House Prices Decline for Third Month as Lenders Restrict Mortgages

By Scott Hamilton - Jan 14, 2011 12:01 AM GMT

U.K. house prices fell for a third month in December as a lack of mortgage finance prevented buyers from making a purchase, research company Acadametrics Ltd. and LSL Property Services Plc said today.

The average price of a home in England and Wales declined 0.2 percent to 222,827 pounds ($354,000) from November, they said in a report issued in London today. Values rose 2.9 percent in 2010. Previously reported monthly price gains for October and November were revised to declines as more transaction data became available.

The U.K. housing market has weakened as the prospect of the biggest government budget squeeze since World War II and tighter lending conditions hurt demand. Hometrack Ltd. said on Jan. 12 that banks won’t increase mortgage lending this year as tougher regulation and a lack of funds curb access to credit.

“With many sellers still reluctant to transact and many buyers being unable to get a mortgage, we have a market which is much reduced in transaction terms,” Acadametrics Chairman Peter Williams said in the report. There is a “real possibility that we will see at best a flat market for the next year or two.”

The Acadametrics report showed the number of transactions probably dropped 5 percent in December to 53,000 from the previous month. That’s a decline of 33 percent from a year earlier.

London Prices

The Bank of England kept its emergency stimulus unchanged yesterday after recent data suggested the economy slowed in the fourth quarter. Policy makers held their bond-purchase plan at 200 billion pounds and their main interest rate at a record low of 0.5 percent.

Home prices fell 0.2 percent in both October and November, Acadametrics said, revising estimates it published on Dec. 10. In London, values rose 0.1 percent to 381,285 pounds in November, the month with the latest available regional data.

“While average house prices are falling, the steady rate of the decline indicates a degree of resilience in the market,” Richard Sexton, director of property-appraisal business e.surv Ltd., part of LSL, said in the report. “However, if prices begin to tumble more quickly, the specter of negative equity could have a significant impact on buyer and lender confidence.”

Acadametrics combines initial housing transaction data from the U.K. Land Registry and results from other price measures to produce an estimate for the most recent month. That number is then revised in following months.

[neon tetra]

Front page will now almost totally show red arrows MoM... Just that dubious Nationwide fudge to remove.

[Pent Up]

Front page will now almost totally show red arrows MoM... Just that dubious Nationwide fudge to remove.

It might not ever show all red arrows. There will always be little jumps in some indicies even in a heavily falling Market.

[Ash4781]

How large were those data revisions?

[Frank Hovis]

It might not ever show all red arrows. There will always be little jumps in some indicies even in a heavily falling Market.

It's looking very good already!

[Pent Up]

How large were those data revisions?

October was +0.1% and November was +0.2% both now revised to -0.2%

So basically we may as well ignore this months guess as it could be revised by up to 0.4% either way.

[Pent Up]

Incase anyone can be bothered reading it:

http://www.acadametrics.co.uk/LSL%20Acad%20HPI%20News%20Release%20December%2010.pdf

The comparison of indices chart is worth a goggle though, very nice

[Realistbear]

+ or - 0.2% is not worth thinking about. The margin of error in these kinds of stats is probably + or - 3%.

0.2% does not register as anything other than a completley static market which is NOT what is happening on the street.

All its good for is to add to the growing number of red arrows.

2011 is looking good. Reeeeeeeeeeeal good.

[rantnrave]

It does tick me off when one survey comes out with a suprise positive increase, which is used by MSM to dilute other signs of falls, only for those figures to be revised into negatives later.

Halifax do adjust the previous month's data from time to time by the odd 0.1% which I can accept and it gives a bit more of a boost to their credibility as a survey. However, for the bunch of muppets that compile the Acadametrics report to revise two previous figures, one of them with a 0.4% swing completely undermines the point of this survey IMO.

[Bruce Banner]

It does tick me off when one survey comes out with a suprise positive increase, which is used by MSM to dilute other signs of falls, only for those figures to be revised into negatives later.

Halifax do adjust the previous month's data from time to time by the odd 0.1% which I can accept and it gives a bit more of a boost to their credibility as a survey. However, for the bunch of muppets that compile the Acadametrics report to revise two previous figures, one of them with a 0.4% swing completely undermines the point of this survey IMO.

The whole point of the Academetrics report is to encourage people to buy houses .

[exiges]

October was +0.1% and November was +0.2% both now revised to -0.2%

Right, so is this month -0.2% from the false/inflated figure last month, or is it -0.2% down from the newly adjusted much lower figure ?

In other words, going from two months of +0.2% this month is morelike a -0.6% from the previously reported figures.

[Bruce Banner]

Right, so is this month -0.2% from the false/inflated figure last month, or is it -0.2% down from the newly adjusted much lower figure ?

In other words, going from two months of +0.2% this month is morelike a -0.6% from the previously reported figures.

Exactly, that's how figures are fiddled, keep the latest newsworthy figure as rosy as possible. No one looks at previous months.

[Timm]

Whether it is lag, bias, faulty methodology or whatever, Acadametrics are having to play catch up with the market.

Their reported YoY increase is falling fast, from a reported +5.9% last month to a reported +2.9% in this report.

PS. Love the "guess" meme on this thread!

[koala_bear]

Other selected highlights to encourage some more discussion.

There is actually some quite bearish stuff and is a lagging index.

What I don't understand is why academagitrix appears to be ~1.8% above the LR figures consistently for 2010 given that it is meant ot be based on LR (or does LR exclude £1m+ or something similar and Acad. doesn't?)

Over the 12 months January to December 2010, house price growth stood at 2.9%, compared to 5.3% in 2009. The rate of growth will slow as the larger gains of a year ago drop out of the calculations

Regional disparities are widening.

The number of transactions continues to decline, falling in December 2010 by 5%, and are down 33% compared to December 2009.

Although the average LTV for first time buyers rose to 80%, the total number of house purchase loans is down 4% - indicating that mortgage refusals have become more frequent.

The disparity between the regions is widening. In traditionally high-value areas such as London and the South East price growth has been significantly stronger than the national average and this is likely to continue through 2011. Public sector cuts will have a particularly heavy impact on prices in northern England and Wales and this means the value-gap could become a chasm as the year goes on.

July 2010 0.4%

August 2010 0.3%

September 2010 0.1%

October 2010 -0.2%

November 2010 -0.2%

December 2010 -0.2%

Any one noticing a trend here . Academagitrix data is revised in later months when more accurate data is available i.e. less guess more real.

Over the last twelve months the average house price has increased below the rate of inflation,

i.e. Dec was YoY negative in real terms

Readers may also care to note that in the first two months of the year the index rose by 3.2% while subsequently it has been oscillating around zero growth, with a mini-peak for the year occurring in September followed by three months of minor price declines.

i.e. Feb will be YoY negative in nominal terms

Greater London, the South East and the South West continue to show annual price increases of 5% or higher but, even in these regions, prices have fallen over the last three months

we would not expect that to change a great deal in 2011.

Clearly some households have to move because of life events such as death and divorce but discretionary moves are in general much lower. This reduced market puts some limits around price falls and rises and this is further underpinned by continuing government help to those in difficulty and low interest rates. As and when these change we can expect the dynamics of the market to respond.

SMI rug pulling any one?

“With the real possibility that we will see at best a flat market for the next year or two a new realism has to be embraced by sellers if their circumstances allow.

The London data is still bonkers though...

[Timm]

Other selected highlights to encourage some more discussion.

There is actually some quite bearish stuff and is a lagging index.

What I don't understand is why academagitrix appears to be ~1.8% above the LR figures consistently for 2010 given that it is meant ot be based on LR (or does LR exclude £1m+ or something similar and Acad. doesn't?)

Any one noticing a trend here . Academagitrix data is revised in later months when more accurate data is available i.e. less guess more real.

(...)

I'm 90% sure they are over-smoothing their data.

They are almost always behind the trend, - they consistently underestimate both rises and falls.