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The Inflation Adjusted Graph (1983-2008)

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OK, here's an update of the seasonally adjusted halifax data since 1983 adjusted for long term 'house price inflation'. This turns out to be 5.9% p.a. to keep the peaks and the troughs aligned.

I was all ready to say that it's all on track and we can tell exactly where, if not when it's going to bottom out if it's not different this time (around 130K in 2008 prices), but on this update the futures have overshot the historical troughs by some way (note they're inflation adjusted too)

I've haven't bothered with the 2% graph on the basis that 2% doesn't seem to be relevant to anyone anymore (least of all BoE)

spreadfairhalifax.JPG

post-1731-1215731463_thumb.jpg

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Totally Agree, inflation un-adjusted that's about 150/160k at the trough

Yeah, there should be a non-adjusted and maybe a RPI adjusted rather than a random 5.9% pulled out the air!?

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Great pretty chart.

Wish I knew what it meant.

:)

P.S. Nice choice of pink.

P.P.S. Can you add more pink to show how long it bumps along at that bottom level

Edited by ScaredEitherWay

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Those futures look oversold.

That's what I thought £10k ago. They've been down further as well - the current price is something of a rally.

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Nice chart.

Can I post it elsewhere?

What are the percentage falls built into futures prices

Feel free. The adjustment to futures prices that I've made is the same 5.9% p.a. (starting from July 2008). The 'raw' futures prices are at www.spreadfair.com. I think they're a good indicator for 'joe punter' sentiment, which is of course the bit of the market that keeps us all interested now the crash is beyond argument.

The idea of the 5.9% is that it (by inspection) brings out the long term adjustment required to compare future house prices against past house prices (to make peaks=peaks, troughs=troughs). While this is of course simplistic, I think it gives a visually intuitive way to try and gauge how far through the crash we are.

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Great pretty chart.

Wish I knew what it meant.

:)

P.S. Nice choice of pink.

P.P.S. Can you add more pink to show how long it bumps along at that bottom level

It means what it looks like, house prices have a way to fall yet. The 'futures' are from a user to user betting site Spreadfair. The rest is from Halifax's house price index. Everything has been adjusted to today's prices by a single inflation factor to make the graph appear flat, however since this number has come out from several decades worth of house price data it should be pretty realistic in relation to house prices at least.

Because of the inflation adjustment it tells you more about '% drop' and 'when' in terms of today's money than anything else - by the time we get to 2011, £130,000 of 2008 money will cost you more than £130,000 ! (how much more depends on other inflation measures I'm not even going to attempt)

I don't have much control over the amount of 'pink' (I wish). In this case it is up to the spreadfair website.

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  • 401 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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