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TheCountOfNowhere

What Does "seasonally Adjusted" Actually Mean ?

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The latest land registry figures, up 0.9 but they are seasonally adjusted.

What do they mean when they say "seasonally adjusted"?

I looked at the report and some of the lower priced sales volumes had plummeted in and around london, has top end sales skewed the figures ?

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Differential sales have skewed the figures, yes. Volume is probably falling faster in poorer areas, as people are finding it harder to get sub-prime style mortgages, and that's a bigger factor on the estates than in Chelsea.

Seasonally adjusted is best explained by inflation. CPI is not seasonally adjusted, and everyone here acts amazed when it's a huge negative MoM number in January. Of course it is, because of the January sales.

House prices are the same. People pay more in Spring - more people are looking, they've just had pay rises, houses look nicer in the sunshine, etc.

There's about a 4% profit to be made by buying in December and selling in June. So you either account for it in your figures, or you get +1% in March, April, May, June even if real prices are flat, and -1% in October, November, January, February.

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The fatal flaw in the LR data is that it fails to make adjustments for improvements made in like-for-like sales data.

And, as we all now know, they fail to factor in fraud as the recent Panorama program highlighted.

Finally, the LR data that is published for public consumption should carry a very clear warning that it does not represent current market activity due to the considerable time lag involved. If people based a decision on whether to buy or not to buy today they need to know that the LR data is an unreliable guide.

It is really worthless as a guage as to what has been happening in the marketplace recently.

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The latest land registry figures, up 0.9 but they are seasonally adjusted.

What do they mean when they say "seasonally adjusted"?

I looked at the report and some of the lower priced sales volumes had plummeted in and around london, has top end sales skewed the figures ?

Seasonal adjustment is a factor that is applied to all statistics to ensure they reflect what their commissioner wants to show.

It takes quite some money to commission statistics with a very large data sample. That is why you do not see the following in the national press.

"Goldfinger Inc reports that although the current price of gold is $925 per oz, seasonally adjusted this equates to $1750"

"RB Industries disputes declining dollar value - Seasonally adjusted, the true exchange rate is GBP1 = USD1"

p-o-p

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Seasonal adjustment is a factor that is applied to all statistics to ensure they reflect what their commissioner wants to show.

It takes quite some money to commission statistics with a very large data sample. That is why you do not see the following in the national press.

"Goldfinger Inc reports that although the current price of gold is $925 per oz, seasonally adjusted this equates to $1750"

"RB Industries disputes declining dollar value - Seasonally adjusted, the true exchange rate is GBP1 = USD1"

p-o-p

That's the answer I was looking for.

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That's the answer I was looking for.

So I trust in July when the surveys are reporting -0.5 MoM you'll be on here saying "Ah but this is seasonally adjusted, the real figures show a rise! The crash is over!" then?

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The latest land registry figures, up 0.9 but they are seasonally adjusted.

What do they mean when they say "seasonally adjusted"?

I looked at the report and some of the lower priced sales volumes had plummeted in and around london, has top end sales skewed the figures ?

Think of it in terms of average monthly temperatures. Imagine a place where the average temperatures for each month of the year are:

J 5deg , F 6 deg, M 7 deg, A 8 deg, M 12 deg, J 20 deg, J 28 deg, A 20 deg, S 15 deg, O 8 deg, N 7 deg, D 6 deg.

The average (mean) across the whole year is 11.8 degress.

Now imagine on a given day it is 10 degrees. So below average temperatures....

But then you realise it is February, so actually the temperture is 4 degrees above average. This is what seasonally adjusted means, ie you remove the average for that month or season before working out any year on year trend or change.

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So I trust in July when the surveys are reporting -0.5 MoM you'll be on here saying "Ah but this is seasonally adjusted, the real figures show a rise! The crash is over!" then?

I'll be saying -0.5 MoM, seasonally adjusted, jesus it must be really bad !!!

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That's the answer I was looking for.

And it's the truth in a nutshell.

Any figures at all - and that applies especially to any you see via Powerpoint or Excel on a projector during some cakky meeting at work - that are seasonally (or in any other way) "adjusted" are simply not showing something that the people producing them don't want you to see.

At best it's to stop you asking awkward questions that prove how stupid they are, and at worst they are outright lies.

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Any figures at all - and that applies especially to any you see via Powerpoint or Excel on a projector during some cakky meeting at work - that are seasonally (or in any other way) "adjusted" are simply not showing something that the people producing them don't want you to see.

So the best house price index, in your view, is Rightmove - no geographic, mix, or seasonal adjustment.

And therefore useless - down 3% one month, up 3% the next, etc.

We probably shouldn't have the graph on the front page of the HPC site either then, it's 'adjusted' for inflation.

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So the best house price index, in your view, is Rightmove - no geographic, mix, or seasonal adjustment.

And therefore useless - down 3% one month, up 3% the next, etc.

We probably shouldn't have the graph on the front page of the HPC site either then, it's 'adjusted' for inflation.

Let's not forget that the Daily Diana will use adjusted figures when unadj are lower and unadj figures when they are higher.

So in the Summer, we will get them ignoring poor adjusted figures and focus on the actual rises. This is probably why the Haliwides of this world are saying that there will be a recovery in the second half of the year. <_<

Edit to add. In answer to the question, Halifax do publish their unadjusted figures as well as the seasoned ones, and Nationwide don't seasonally adjust (according to an answer up the thread or on another one, can't remember which).

So the best bet is to look at the unadjusted figures and YoY, but if they go a bit positive in the summer, remember to account for this a little in our psyche, if not in the figures. :)

Edited by bobthe~

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So the best house price index, in your view, is Rightmove - no geographic, mix, or seasonal adjustment.

And therefore useless - down 3% one month, up 3% the next, etc.

We probably shouldn't have the graph on the front page of the HPC site either then, it's 'adjusted' for inflation.

Yes, because they are the truth and that makes them the most useful. A trend is still a trend, and the person who questions will find the correct answer.

Any manipulation, however well-intentioned, will lead to mistakes, or fraud.

Any adjustments to clarify points such as yours should be presented alongside the unadulterated figures, not instead of them.

Only then can they be trusted.

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  • 293 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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