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Interesting Hpi Measurement Paper.

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Sorry if its been done (haven't seen it before), but here it is:

Mouseprice Press Release for Mouseprice Index

Basically mouseprice are trying to compile their own House Price Index (as if we need another) based on Land Registry data.

This paper explains why they think their method is correct.

The graph on page 22 is interesting as it compares HaliWide, Land Registry (Raw sales data), Rightmove etc against their new measure. Funny how Real Sales data from the Land Registry shows prices lower than the other indices... and that this divergence only occurred a short time ago?? Very interesting.

Also a table comparing the various indices and how they are made up (pun intended).

Graph for those to lazy to read the whole thing (its boring and full of things only statisticians dream of):

Sprite_6.jpg

Enjoy :D

In reply to myself:

Just looked at the graph again and it is more interesting than I first thought.

All of the indices seemed to be fairly together pre 2002.

Then in July 2002 the other indices head a bit higher than the Land Registry data (which is real sales prices - apart from a few dodgy cashbacks).

Then in around July 2004 the LR data seems to flatline then dive a bit and flatline again, all the while the other indices are going higher before also levelling off.

Given that the LR prices are actual paid prices and accurate what does this say for the other indices?

Seems to me that something interesting happened with these indices in about mid 2002 and mid 2004??

Any ideas.

post-692-1142951088.jpg

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Wasn't mid 2004 about the time the land reg opened its online query tools?

This meant everyone could easily see what any property went for previously.

It's obvious to see how this would flatten the market.

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Wasn't mid 2004 about the time the land reg opened its online query tools?

This meant everyone could easily see what any property went for previously.

It's obvious to see how this would flatten the market.

Any takers for 2002?

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If the LR figures are correct the market began to flatline in October 2004. This suggests the VI stats have been cooked ever since :) .

We now know Rightmove is rubbish so how about NW? HT?

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whats interesting is the periodic flatlining of the market... the market appeared to flatline in 2001 and 2002... it almost flatlined in 2003....

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I believe that the only way to achieve the fabled soft landing is for house prices to stop going up while people still believe that they are going up. Maybe this is what is being attempted with the various cooked figures, changed indicies (quoting asking prices) and so on.

Billy Shears

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I believe that the only way to achieve the fabled soft landing is for house prices to stop going up while people still believe that they are going up. Maybe this is what is being attempted with the various cooked figures, changed indicies (quoting asking prices) and so on.

Billy Shears

Can't continue forever though. Sooner or later people realise that the figures are disconnected from reality, mainly when they come to sell and find that they can't.

Just been looking at LR data for recent sales in my area. I am genuinely shocked to see how much lower the price paid is against the asking price.... staggering.

I've seen house with asking prices of £160K showing as sold for £114K. OK, the asking price was very optimistic but if a vendor was asking £160K I wouldn't even bother offering £114K as I would have assumed they just would not accept that kind of drop.

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Can't continue forever though. Sooner or later people realise that the figures are disconnected from reality, mainly when they come to sell and find that they can't.

Just been looking at LR data for recent sales in my area. I am genuinely shocked to see how much lower the price paid is against the asking price.... staggering.

I've seen house with asking prices of £160K showing as sold for £114K. OK, the asking price was very optimistic but if a vendor was asking £160K I wouldn't even bother offering £114K as I would have assumed they just would not accept that kind of drop.

True, but short term "solutions" to problems, putting a band aid on it, is not exactly unknown in business.

I must start looking up asking price to selling price figures around my area. Properties on my spreadsheet are too recent for any of them to have turned up in the LR figures. How do you find out asking prices for some time ago?

Billy Shears

Edited by BillyShears

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True, but short term "solutions" to problems, putting a band aid on it, is not exactly unknown in business.

I must start looking up asking price to selling price figures around my area. Properties on my spreadsheet are too recent for any of them to have turned up in the LR figures. How do you find out asking prices for some time ago?

Billy Shears

Worth noting that the other indices diverged from the LR data, but only so far.

Maybe this is the limit above which the other indices look ridiculous, where credibility would be stretched too far.

Short term figures for HaliWide etc can get away with anything as the LR data lags, but in retrospect they will become a laughing stock.

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Sorry if its been done (haven't seen it before), but here it is:

Mouseprice Press Release for Mouseprice Index

Basically mouseprice are trying to compile their own House Price Index (as if we need another) based on Land Registry data.

This paper explains why they think their method is correct.

The graph on page 22 is interesting as it compares HaliWide, Land Registry (Raw sales data), Rightmove etc against their new measure. Funny how Real Sales data from the Land Registry shows prices lower than the other indices... and that this divergence only occurred a short time ago?? Very interesting.

Also a table comparing the various indices and how they are made up (pun intended).

Graph for those to lazy to read the whole thing (its boring and full of things only statisticians dream of):

Sprite_6.jpg

Enjoy :D

In reply to myself:

Just looked at the graph again and it is more interesting than I first thought.

All of the indices seemed to be fairly together pre 2002.

Then in July 2002 the other indices head a bit higher than the Land Registry data (which is real sales prices - apart from a few dodgy cashbacks).

Then in around July 2004 the LR data seems to flatline then dive a bit and flatline again, all the while the other indices are going higher before also levelling off.

Given that the LR prices are actual paid prices and accurate what does this say for the other indices?

Seems to me that something interesting happened with these indices in about mid 2002 and mid 2004??

Any ideas.

Could it be that the LR figures are only England and Wales and thus exclude Scotland and Northern Ireland which have experienced their biggest rises late in the cycle and (assuming they are in the ODPM and Haliwide figures which I think they are) would account for some of the differential?

I can't believe that this oversight would have been missed in preparing the grpah but either ALL the figures needs to be UK based or ALL Eng/Wales based to allow like for like comparisons. Anyone know what the story is on what is included within each measure?

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I have no idea what Mouseprice are up to :rolleyes: , but these are the “correct” figures plotted below. The point being that they are all in broad agreement with the lower HBOS and Nationwide reflecting median prices and the upper LR "simple average" and ODPM mix-adjusted reporting the mean, which, as we know is about 20% above the median on account of the shape of the distribution; then floating above like a kite is rightmove with it's mean initial asking prices, but not actually plotted here.

Comparing the House Price Indices

rk3j88.jpg

I've dug up this graph below from an old thread showing the long term comparison between Halifax and the ODPM average and mix-adjusted indices. The differences are quite interesting - back in 1990 the HBOS index was calibrated to reflect the ODPM mix-adj price but now it is calibrated to reflect the ODPM/LR median price (see above graph). Also the ODPM/LR simple average (aka mean) misteriously dropped down between 1980 and 1995.

Comparing HBOS and LR recently and in the past

fcjgo1.jpg

Edited by spline

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  • 301 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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