House price histories

20 June 2008

What’s happening with house prices? Wherever we look, we find different experts making different predictions. Even more confusing, those experts change their minds as the housing market changes – if you find a company predicting a 5% fall in prices in 2008, there’s a fair chance that back in December they were talking about a year of ‘flat’ prices.

Still more confusing, it seems there’s no definite agreement on where we stand today!

Where do we stand today?
There’s no ‘right’ or ‘wrong’ answer. For example:

• the Halifax House Price Index ‘is based on the lending of the UK’s largest mortgage lender’, while
• the Land Registry House Price Index uses ‘Land Registry’s data set of completed sales’ and ‘is the only index to be based on repeat sales’.

Why the disagreement?
Different experts look at different figures. If many of the houses they’re looking at are in London, for example, the average price will be high, and the monthly and annual changes are more likely to be positive.

There’s also the timing, as some organisations release their figures faster than others: when this blog was written, May’s figures hadn’t appeared on the Land Registry website yet.

When we hear so many different expert opinions on where house prices are headed, it’s good to remember how complicated the whole issue is – and remember that everyone sees different parts of the housing market.

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