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A Maths Question

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If a house in the north of England went down 50% from £100,000 down to £50,000

and a house in London went up by 5% from £1,000,000 up to £1,050,000

What would be the average price fall as a percentage

a) a fall of 22. 5 %

B) prices haven't changed

c) some thing else

I thought a) was the answer but now I think it's B) London has a bigger influence on house prices than I had originally thought.

Edited by gf3

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good point.

take the unemployment rate.

the figure is a percentage of the working population out of the workforce.

take 10 people, all in the workforce

say 8 of them are working...thats 20% unemployment.

now say, one of the workforce decides to retire.

same 8 are working....now only one in nine are unemployed...11% unemployment.

Course, the Statisticians can massage figures in any way they choose...lets say THEY decide one of the unemployed is now not in the workforce because he has a bad toe, or a stiff neck, or is 55, where many public servants would be out of the workforce.....its easy for politicians to corrupt the figures they present as truth.

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This is an example of why having things like a paired t-test in statistics is important. There are many ways to skin a cat, depending on how deceptive you intend to be.

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If a house in the north of England went down 50% from £100,000 down to £50,000

and a house in London went up by 5% from £1,000,000 up to £1,050,000

What would be the average price fall as a percentage

a) a fall of 22. 5 %

B) prices haven't changed

c) some thing else

I thought a) was the answer but now I think it's B) London has a bigger influence on house prices than I had originally thought.

Of course you need to weight the transactions by number.There may be five million house dropping by 50% and fifty thousand going up by 5% in which case the average fall will be 45% odd.

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Of course you need to weight the transactions by number.There may be five million house dropping by 50% and fifty thousand going up by 5% in which case the average fall will be 45% odd.

or you could weight by house type, region, season, price band, council tax band, size of garden....anything to make a statistic virtually meaningless to just about everyone...this is probably why everything that reality is throwing up these days is "unexpected".

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Of course you need to weight the transactions by number.There may be five million house dropping by 50% and fifty thousand going up by 5% in which case the average fall will be 45% odd.

You are missing the point If an average house in London is worth three times as much as a average house some where else in Britain if the three houses go down by 10% and the house in London goes up by 10% then have house prices on average gone down.

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A maths questions... mathSSSSSSSSSSSSSSSSS.

Sorry, pet hate!

depends which version of English you use.

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A maths questions... mathSSSSSSSSSSSSSSSSS.

Sorry, pet hate!

Their, their, calm down.

Good point though - thanks for doing us all the favor. I couldn't of agreed more.

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Actually its an Arithmetic question :

Arithmetic: The mathematics of integers, rational numbers, real numbers, or complex numbers under the operations of addition, subtraction, multiplication, and division.

not sure about the real numbers part regarding house prices though

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good point.

take the unemployment rate.

Umm. Question: Does the "unemployment rate" only cover those people who qualify for the dole? Can you register as being "unemployed" and be included in the government statistics even if you do not qualify for unemployment benefit? (Because your income from "other sources" is over the limit.)

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If a house in the north of England went down 50% from £100,000 down to £50,000

and a house in London went up by 5% from £1,000,000 up to £1,050,000

What would be the average price fall as a percentage

a) a fall of 22. 5 %

B) prices haven't changed

c) some thing else

I thought a) was the answer but now I think it's B) London has a bigger influence on house prices than I had originally thought.

This isn't a maths question, it's a question of semantics.

In your scenario, the average percentage drop is 22.5% whereas the percentage change in the average house price is zero.

Neither is 'right' or 'wrong', they just answer different questions. Probably neither is what the index providers are actually publishing but I think that answer b is closer since they are typically percentage changes in published indices. However, the calculation of those indices is more complex than a simple average.

Personally, I think it is impossible to produce a meaningful, monthly house-price index.

Edited by (Blizzard)

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Umm. Question: Does the "unemployment rate" only cover those people who qualify for the dole? Can you register as being "unemployed" and be included in the government statistics even if you do not qualify for unemployment benefit? (Because your income from "other sources" is over the limit.)

they count those in the "workforce".

The definition of "workforce" is entirely under Political control.

Hence,for example, the US official unemployment is 9.2% IIRC, yet sources say actually 1 in 5 is unemployed.

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If a house in the north of England went down 50% from £100,000 down to £50,000

and a house in London went up by 5% from £1,000,000 up to £1,050,000

What would be the average price fall as a percentage

a) a fall of 22. 5 %

B) prices haven't changed

c) some thing else

I thought a) was the answer but now I think it's B) London has a bigger influence on house prices than I had originally thought.

Average house prices are calculated by:

SUM(prices of house sold)/COUNT(of house sold)

They are also calculated using a lot more houses than two, and also broken down by area. But to answer the question. The previous average would have been (£1,000,000 + £100,000)/2 = £550,000. The new average would be (£1,000,000 + £100,000)/2 = £550,000 so no change(i.e. 0%. The regional average would be London up by 5%, North East down by 50%.

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Average house prices are calculated by:

SUM(prices of house sold)/COUNT(of house sold)

They are also calculated using a lot more houses than two, and also broken down by area. But to answer the question. The previous average would have been (£1,000,000 + £100,000)/2 = £550,000. The new average would be (£1,000,000 + £100,000)/2 = £550,000 so no change(i.e. 0%. The regional average would be London up by 5%, North East down by 50%.

BBC would have reported house prices soar.

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they count those in the "workforce".

The definition of "workforce" is entirely under Political control.

Hence,for example, the US official unemployment is 9.2% IIRC, yet sources say actually 1 in 5 is unemployed.

whats the true unemployment rate here?

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Average house prices are calculated by:

SUM(prices of house sold)/COUNT(of house sold)

They are also calculated using a lot more houses than two, and also broken down by area. But to answer the question. The previous average would have been (£1,000,000 + £100,000)/2 = £550,000. The new average would be (£1,000,000 + £100,000)/2 = £550,000 so no change(i.e. 0%. The regional average would be London up by 5%, North East down by 50%.

I don't think this is right. Or at least it should be.

It should be London house up +5% Northern down -50% add them together and divide by two gives -22.5%. Overall.

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I don't think this is right. Or at least it should be.

It should be London house up +5% Northern down -50% add them together and divide by two gives -22.5%. Overall.

this is the sort of thing the weighting is for.

otherwise I could set myself up as an estate agent, put my house for sale on rightmove priced at 100 million for a month and then reduce the price to a more reasonable 100k and skew the rightmove asking prices index with one house. maybe we should set up an estate agency or two and do this all over the country lol.

statistics are lies, use your eyes.

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  • 311 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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