Tuesday, August 8, 2006

Land Registry HPI

House prices near £200,000 mark

The price of an average home in England and Wales is now nearly £200,000, according to the Land Registry. In the April to June period the average house price in England and Wales was up 7.71% on a year ago to £199,184. In addition, the number of home sales jumped by 24% compared with last year, the registry said. Last week, the Bank of England raised interest rates in a bid to quell inflation and some analysts think this move could cool the housing market.

Posted by jason @ 06:32 AM (789 views)
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33 thoughts on “Land Registry HPI

  • Son Of Taeper says:

    7.71% = 0.64% per month. That is not a lot by my reckoning and barely keeping up with interest rates. Next months figures should be interesting too.

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  • Bloody Annoyed says:

    Had a drink with a friend of mine the other night.He got on the ladder just before they started shooting up to the ridiculous prices they are now.He has had a feel good factor from this for years but his opinion seems to have changed over the past week. As far back as 4 years ago people were saying “surely they can’t go up any further” and they just kept going up.It all looked terrific for those who had already invested but even my friend who has done everything right, he bought at a good time and didn’t overstretch himself financially has succumbed to a feeling of impending doom. I hope he is wrong. I won’t matter a damn when house prices crash if noone has a job.

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  • George Monsoon says:

    As much as I want this to be false, burying my head in the sand and going la.la.la.la won’t make it go away. There must be some truth in the figures? Can anyone explain how they establish these figures and are they to be trusted, after all it is the land registry that has published the information, not a V.I.

    and can I do a search on the land registry data for free, or do I have to pay?

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  • The figures don’t overly surprise me at least as far as the South-West is concerned. Spring was noticably busy with houses across the range selling. Since the tail end of June the market has taken a noticeable dip in my area of Somerset which will probably be exacerbated by last weeks IR rise, however I was on the Ashton/Southville area of Bristol Saturday and all I saw were sold signs. Speaking to EA’s I know, they admit they are quiet but at the same time they will state they don’t have much stock which is what is generating the price rises because EA’s are pricing to get the instruction.

    To me property seems ridiculously over-priced and exhibiting all the characteristics of a bubble but I do wonder to what extent the high levels of immigration which will no doubt grow next year with the entry of Romania and Bulgaria into the EU are helping to prop up prices and will continue to maintain some level of stability. I wholeheartedly believe the days of high HPI are over for the foreseable future but however much I would like to see signs of crash I can’t really see it being this year but I’ll bet we will start hearing tales of woe from the VI’s by the Autumn.

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  • The Capitalist says:

    The BofE are printing money at the rightof 14% per annum (M4 money supply I think it’s called). That’s right, a whopping 14% more liquidity. Until this tap stops, HPI will continue to go up. The szchoid Old Lady of Threadneedle St is also now having to raise IR because commodities are going through the roof (oil price peaks as BP shut down a plant supplying 8% of US market) and we all know inflation is nearer 10% for the man in the street.

    Property is vastly over-priced but John Bull has been brainwashed (esp. those under 35) that bricks and mortar are cast-iron investments. It’s simple really, markets are cyclical – why should it be differant this time round? We will be vindicated. In the meantime, invest in commodity-based investment trusts and insolvency firms!

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  • George Monsoon said:
    >>and can I do a search on the land registry data for free, or do I have to pay?

    George

    Go to http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/houses.stm

    The site lets you search by area and uses the Land Registry Data.

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  • This is crazy-how long does this go on? I have always regarded the LR figures as sound compared to some of the info churned out by the likes of Rightmove, given that the Registry figures are based on actual sales and as they have no vested interest.

    George-you can access the LR report through the link on the statistics table.

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  • I wonder what the figures would look like if you took out all the properties over 1 million. The report makes great mention of how many more there are and so this must skew the figures significantly.

    PS. George: you can see house price trend graphs by town or postcode at Home.co.uk.

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  • Son Of Taeper says:

    George, check this one out.
    http://www.houseprices.co.uk/
    Right down to exact postcode level. Ideal for when you find the house of your dreams and want to know the vendor only purchased it a year ago and is trying to retire on the profits.

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  • It looks like the land registry figures include all the remortgaging figures too – so these activities are not actual sales – people are not actually buying and selling like we are lead to believe, but people taking equity out from their properties and everytime this happens the new mortgage deed goes to Land registry for update.

    Quote from http://www.thosflavell.co.uk/remortgage.htm

    Quote
    “COMPLETION AND AFTER

    On the day you choose to complete your re-mortgage we utilise your new mortgage money to pay off your existing mortgage and any other secured loans that affect your property. Any balance remaining after payment of Land Registry fees, searches and our costs, is paid to you.

    After completion, we register your new mortgage at the Land Registry and finally return your deeds to your new lender after the registration is complete.”
    End Quote

    It looks like the land registry figures include all the remortgaging figures too – so those are not actual sales, but people taking equity out.

    One of the BOE reports mentioned that the land registry data are not “mix adjusted”
    (Look in http://www.bankofengland.co.uk/publications/speeches/1998/speech20.htm)

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  • George Monsoon says:

    thanks for all the research material, I have done my research.

    205 thousand pounds is the average for my area!

    My partner and I could probably just about afford to pay back 3.5 times our combined income (just over half the average price) – That equates to a very run down semi with no central heating, no double glazing… on a busy road, no garage, no drive, tiny garden, in a rough area… etc..etc…

    Now if we started a family and one of us needed to stop working, or the interest rates rose, god help us.

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  • George Monsoon says:

    thanks for all the research material, I have done my research. £205,000 is the average for my area!

    My partner and I could probably just about afford to pay back 3.5 times our combined income (just over half the average price) – That equates to a very run down semi with no central heating, no double glazing… on a busy road, no garage, no drive, tiny garden, in a rough area… etc..etc…

    Now if we started a family and one of us needed to stop working, or the interest rates rose, god help us.

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  • This is the BBC getting all frothy about nothing – the statistics don’t back it up.

    Look more carefully at the figures. As the BBC have presented the figures, the average is £184,386. As an average, this is still quite a way off £200,00.

    Take out the Greater London figures (which don’t represent anything going on anywhere else) and this average plummets to £169,576.

    House prices have not budged for the last year at least according to the graph on the HPC front page taken from the Halifax published stats.

    What kind of miracle exactly does the BBC think will make average prices jump that extra 20-40 grand?

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  • Tinecu makes a good point. In the City at Christmas over a 1000 people had bonuses – yes, just bonuses! – of over a £1,000,000. This had a dramatic, but I suspect geographically and temporally localised effect of the upper end of the property ladder and may have skewed the average. A better measure of property price trends for the vast majority of people in the country would, in some respects, be mode or median price, rather than mean price. I’d have to see a box-plot to be sure of this.

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  • uncle chris says:

    Just out of curiosity, I’ve just checked the ‘Land Registry’ figures for ‘Oswestry’ using http://www.houseprices.co.uk. The BBC figures state that in Apr-Jun 2006 there were 215 sales, whereas I can only find 136. They also state the average house price is £179,900, whereas I calculate a mean (top and bottom 3 clipped) of £169,380 and a median of £148,750 – neither of which tally with the BBC figure. Now perhaps they have more up-to-date figures than ‘houseprices.co.uk’ but their figures suggect a 27.5% annual increase in the area, whereas my own monitoring has shown a 10-15% decrease. It all goes to show that you have to be very careful with statistics (as we all know) because they can be easily biased to support whatever point you are trying to get across.

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  • Correct me if I’m mistaken, but the report isn’t saying that prices have risen by 7.7% over a year, they are saying that whatever the quarterly rise was in a particular quarter last year, the rise in the same quarter of this year is 7.7% higher.

    In other words, if in the second quarter of 2005, house prices rose by 0.00000000000001%, then in the second quarter of 2006 they rose by 0.00000000000001077%.

    Bingo, 7.7% increase.

    In my mind, it shows an INCREDIBLY desperate manipulation of statistics to show news in as remotely a positive light as posisble.

    I’m quite happy – I think they will run out of anything positive to say within a few months.

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  • Lnicol01-whilst mortgage details are recorded against the property concerned in the LR’s records, the mortgage figures are not included in this survey, only actual prices paid on actual sales.

    inbreda-the average price for the last quarter the LR give is £199,184 as against that for this time last year of £184,924 i.e an increase of 7.71%. As I mention above there is a link to the full report in the statistics table.

    BA-yes, I’m annoyed too-lets hope your friend is right! These figures certainly do not reflect what I see locally which is stagnation.

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  • devil's advocate says:

    They certainly reflect what is happening in my area. Prices have definately risen and properties are selling. I read a lot of the articles on this site and have taken a lot of the information on board, hence my delay in getting back on the ladder. One thing that makes me feel uneasy is the constant implication of a major conspiracy, it does seem a little far fetched at times. Everyone seems to be a VI and even government stats are supposedly cooked.

    If I read an article and saw loads of comments agreeing that unfortunately prices do seems to be rising but we know that these will come down due to A,B,C etc. then I would have more confidence that your not all looking for something that isn’t there and add to each others delusions.

    To an outside viewer this does look like a forum for conspiracy theorists.

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  • devil's advocate says:

    They certainly reflect what is happening in my area. Prices have definately risen and properties are selling. I read a lot of the articles on this site and have taken a lot of the information on board, hence my delay in getting back on the ladder. One thing that makes me feel uneasy is the constant implication of a major conspiracy, it does seem a little far fetched at times. Everyone seems to be a VI and even government stats are supposedly cooked.

    If I read an article and saw loads of comments agreeing that unfortunately prices do seems to be rising but we know that these will come down due to A,B,C etc. then I would have more confidence that your not all looking for something that isn’t there and add to each others delusions.

    To an outside viewer this does look like a forum for conspiracy theorists.

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  • The Watcher says:

    Son Of Taeper said…
    7.71% = 0.64% per month. That is not a lot by my reckoning and barely keeping up with interest rates. Next months figures should be interesting too.

    NO!!! It is even worse! 7.71% = 0.62% per month

    7.7% per year = (1+0.0771)^(1/12)*100 = 0.62% per month

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  • inbreda gets the bonus points.

    It IS talking about an increase on the current April – June period compared with the April – June period last year.

    Desperately desperate froth about nothing.

    It reminds me of talk about inflation stats in the 1970s (my da always tells me this one), where because the BBC couldn’t say “inflation isn’t rising any more”, they’d trumpet “the rate of change in the inflation figures has slowed dramatically”.

    And you thought the BBC were a recent VI!

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  • George Monsoon says:

    Devil’s advocate said “To an outside viewer this does look like a forum for conspiracy theorists.”

    To an outsider it would appear that way, but personally speaking, I come on here to improve my economics knowledge of how “the whole housing market” thing works. There are some very well educated people who visit this site and post valuable information for the layman, like myself who is in the market to buy, but can’t until the prices drop. – Lets face it, prices do need to drop, you don’t need to be a genius to work that one out. It is good to see how interest rates, employment levels, inflation, lending critera and other factors affect the “face value” of a house.

    I call it “HOPE” – and unlike Morgan Freeman in shawshank redemption, I think hope is not a dangerous thing. I am crawling through the half mile pipe of sh~~ and at last I can see a light…!

    And.. it offers an outlet for my frustration when I feel the need to gripe :O)

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  • uncle chris says:

    Inbreda – the figures do point to a straighforward 7.7% rise since the same period last year, as opposed to an increase in the rate of increase (confused?) … that said, I didn’t realise that remortgages (Mews) made their way into the figures. I know of at least 2 friends/associates who have taken the opportunity of higher valuations to ‘borrow’ more money from the bank – against my advice I hasten to add. DA – it might seem like conspiracy theories, but when the VIs still talk up the market and you know the opposite (certainly in my area) to be true it tends to get your blood boiling. However, the housing market is not the only example of this modern day propensity for misleading ‘spin’ … best year for the NHS springs to mind.

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  • waitingfor hpc says:

    I agree with Uncle. We are not talking about murder in our theories but manipulatiojn of figures by a desperate govt. Quite possible. After all they have lied and cheated their way through the last 10 years. What about the sudden change in the golden rule?………
    At the end of the day logic dictates that house prices are way too high. In Kent a 4 bed house detached is £800,000.
    Nice house ….. but what kind of money do you have to have or earn to buy this nice middle class house? If you have £200,000 in the bank then a mortage over 25 years to BUY the house would be extortionate?

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  • I’ve just checked out my postcode in London with the Landregistry and last quarter it was around £277k and now it is nearer £259 k – I recommend using their interactive property price to track exactly how many sales and price averages in your postcode area. Go back a full year or so. Very useful. I find their date encouraging as you can really see how many people are buying what in your street.
    http://www.landreg.gov.uk/propertyprice/interactive/ppr_ualbs.asp

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  • let the crash begin

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  • I can’t imagine there’s fiddling going on …just incompetance in delivering stats….a wide spread problem.

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  • Ok, conspiracy or no conspiracy can someone please explain what is so ambiguous about the LR figures that leads anyone to believe that they are detailing anything other than a straightforward 7.71% increase year on year-I find this seemingly unstoppable market as difficult to accept as the next person but the figures contained in the report do show this annual increase, as now included in the Statistics section on this page of this website, and therefore as presumably checked and accepted by the site’s webmaster.

    I agree with DA on this occasion-whilst a degree of paranoia is justified in the face of what is undoubtly a major effort in some quarters to keep the market talked up (e.g. the Daily Express), we do need to actually read the article in question and related reports before attempting to rubbish them.

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  • Well said DA and Markd

    This site has certainly turned out that way which is why I now rarely visit it anymore. I just think most people on this site must have their heads buried so deep in the sand or because they have their own VI in seeing the market crash they are trying to convince the rest of the country not to buy in the hope of encouraging one. People like Inbred pick away at every report if it shows an increase, especially if its from the BBC when all they are reporting is the information given to them from Rightmove, Hometrack etc. When the BBC report a drop they choose to ignore it.

    They talk about BTLers as the lowest of the low because they are buying for financial gain but there are people on this site who sold up hoping for a crash and are very happy to see 1000’s of people destroyed by the fallout so they can buy later for a financial gain. At least the BTLers have given us a roof over our heads!!

    3 years ago the advise given on this site was not to buy. I wish I never listened

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  • Markd I think it has got the point where everyone has given up waiting and just decided that house prices are falling anyway, screw whether they are or not they are, anything else is twisted figures 😛

    Meh, I want prices to fall but there has to be some truth in all these figures, there’s only so far they can twist it.

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  • Billy,

    There will be pro-democracy activists in Myanmar and China doing exactly the same thing as us here. And there will be pro-government apologists telling them to shut up and stop coming up with conspiracies.

    In other countries, politicians and state media are self-serving and corruptible.Over here, politicians and state media are self serving and corruptible. Is their protest at state-funded misinformation acceptable and ours somehow unacceptable?

    The difference I suppose is that the deception is more obvious here because there is more transparency – we have that much to thank our good (past, and sometimes present) leaders for. We analyze the statistics that are published here, and give a more truthful picture.

    I chose the word “truthful” carefully there too. Halifax and Nationwide publish average house price statistics. They are not a full reflection of the market because there is no quotient, i.e. if only one house is sold in a month for 10% above the previous selling price then those stats record a national 10% increase. Accurate? Yes. Truthful? No – it does not correctly reflect the price changes for all houses on the market.

    In this 7.7% increase we see exactly the same statistical sleight of hand. The Land Registry report says that between April and June last year, prices were at a certain level, and this year over the same period, there’s a 7.7% increase in prices. The BBC has seized this rather unremarkable statistic (which ignores previous or following month changes), wrapped it in hyperbole (“prices will hit £200,000”) and slapped it at the top of the business section.

    The People’s Daily would be proud of such a manipulation of the stats. If you like Billy, you can be proud of it too – we’re not impressed here though.

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  • And the BBC doesn’t report house price falls usually until well after the fact and only in the context of rises. I’ve challenged Tim Weber (BBC online editor) about this point before and received no answer.

    You can be proud of that too, if you like.

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