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Bingley Bloke

When Higher Asking Prices Don't Signal Hpi...

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'House Prices Move Upwards Again' was the proud headline made on the BBC web site back in December. But read the article with your eyes open and you might well spot and interesting fact tucked in among the lines. It goes something like this...

House prices in England and Wales rose for the first time since the summer of 2004 in December, according to property website Hometrack.

The survey, which monitors property asking prices, suggested the average cost of a home rose by 0.1% to £160,900 during the month.

Did you spot it? For those of you who didn't, it's two little words... ASKING PRICES

What the article actually told us is that the average asking price had increased by 0.1%. But did that mean that the type of property which had been on the market for £300,000 last month was now on the market for £300,300? Well I reckon not. Let me explain something...

I like to go about my life without my head wedged up my backside, and, with my interest in house prices, I have carefully monitored asking prices in my area for a number of years, carefully selecting properties from all price ranges and bookmarking them, watching to see how long properties stay on the market for and what disappears only to reappear later at a lower price, and I noticed something interesting...

During the latter part of 2005, in my area at least, there was an increase in the number of higher-end properties appearing on the market. Now, if all the properties are one- and two-bed flats asking between £100K and £200K then you can realisticly suggest that the average asking price is £150K. However, if a whole load of £500K properties enter the market the average asking price will be distorted upwards. In my area at least, properties were being offered at lower prices than equivalent properties from months earlier, but an influx of higher-end properties increased the percentage of 'expensive' properties on the market, so while the average asking price went up as a result of this unflux of bigger houses, the asking price of any given type of property was still falling... And that's something the BBC didn't tell us.

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  • 333 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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