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bluebeard

Moneyweek Report Challenges Rightmove Data

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Apologies if this has already been posted - just came across it.

Property website Rightmove purports to measure average asking prices for UK property. But it doesn’t really. At best it measures how optimistic – or unrealistic - sellers and estate agents are feeling... But the problem with the Rightmove survey is that it only includes the prices of houses and flats that have been put on the market that month. The survey doesn’t include properties that have previously been put on the site, and are still sitting there unsold – even if the asking price has been dropped.

We all know that the price a vendor hopes for and the price the buyer eventually pays are two very different things, particularly in today’s uncertain market. So Rightmove is probably the most optimistic house price measure you can possibly get.

...And a new house price index, also focusing on asking prices, paints an even bleaker picture than the Rightmove survey.

According to property website home.co.uk, average asking prices in England and Wales have fallen by 1.9% over the past year. The North East has suffered the worst, with asking prices down a full 4.6% on 2005.

That sounds much weaker than many of the other surveys – but home.co.uk claims to have the best statistical toolbox of all the house price indices. The company takes into account the asking prices of around 670,000 UK property prices – more than any other house price survey. It also excludes properties valued at over £1m, and those valued at under £20,000, to avoid skewing the data.

Interestingly, the people at home.co.uk say that the results of their index were very similar to Rightmove’s up until December 2004. After that, the two started to diverge, with home.co.uk recording lower prices.

This makes sense. The housing market slowdown began in earnest in around about mid-2004. So by December, all those people who’d been hoping for a quick summer sale would have started to realise that their homes weren’t going to shift without some movement on the price.

So 2005 saw a great deal of asking price-cutting, which would have been reflected in the home.co.uk report, but not in Rightmove’s. And judging by the fact that the two reports still show very different results, it would seem that people are still having to cut asking prices to get their houses sold.

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Yes Bluebeard, you're right. Rightmove's reports should be filed under fiction as they are little more than a measure of new vendor delusion. The methodology was clearly designed to maximise the opportunity to report 'rising house prices' each month.

Rightmove are also managing to skew their figures up heavily each month thanks to the disproportionate number of upmarket agents joining at the moment. I understand that many of these agents had exclusive contracts with PrimeLocation which have now come to an end. The recent flood of expensive property onto Rightmove has been quite noticeable in my area, East Anglia.

Rightmove are currently reporting annual HPI of 10% for East Anglia. In reality this is complete and utter tosh and I suspect most estate agents know it is. Suffolk prices peaked in the summer of 2004, but this clearly isn't the case in the 'world according to Rightmove'.

I'd agree with that - we have been looking in Suffolk for about 6 months and have just decided to rent instead. The EDP pages are full but there are significant numbers of properties tagged with "new price". The same agent that was telling us that they couldn't get property on thier books quickly enough has suddenly started chasing us with new properties. Something smells.

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Yes Bluebeard, you're right. Rightmove's reports should be filed under fiction as they are little more than a measure of new vendor delusion. The methodology was clearly designed to maximise the opportunity to report 'rising house prices' each month.

Rightmove are also managing to skew their figures up heavily each month thanks to the disproportionate number of upmarket agents joining at the moment. I understand that many of these agents had exclusive contracts with PrimeLocation which have now come to an end. The recent flood of expensive property onto Rightmove has been quite noticeable in my area, East Anglia.

Rightmove are currently reporting annual HPI of 10% for East Anglia. In reality this is complete and utter tosh and I suspect most estate agents know it is. Suffolk prices peaked in the summer of 2004, but this clearly isn't the case in the 'world according to Rightmove'.

Didn't their indices include a few £10M 1 bedroom flats for a while (i.e. outright lie stat skewing rubbish)?

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Well, despite all the wishful thinking about all the faults that Rightmove is imagined to suffer, it does appear from the historical evidence back to 2002 that they’ve tracked the LR figures (as embedded in the FTHPI-MA index) rather well (see the purple and light green lines below) and have remained perfectly consistent with the ODPM, Halifax, and Nationwide view. :D

hbosjune20064it.jpg

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Well, despite all the wishful thinking about all the faults that Rightmove is imagined to suffer, it does appear from the historical evidence back to 2002 that they’ve tracked the LR figures (as embedded in the FTHPI-MA index) rather well (see the purple and light green lines below) and have remained perfectly consistent with the ODPM, Halifax, and Nationwide view. :D

Someone care to write to Home.co.uk?

http://www.home.co.uk/contact.html

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One of the key Home.co.uk claims is this: the initial asking price as recorded by Rightmove is biased too high, too optimistic, and Home.co.uk is superior because it "corrects" for this …. but we see in Dec 2004 that RM = £190k whereas Home.co.uk = £240k – so it would appear that despite what they say that exactly the opposite is true! :lol:

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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