Halifax House Price Index under fire after posting ‘erratic’ figures

Questions have been raised about the reliability of the Halifax House Price Index after it recorded a 5% annual boost in property values for April 2019.

The latest report showed house prices were up 1.1% on a monthly basis to £236,619.

But its annual figure has come under scrutiny, especially in comparison to other indices.

The Nationwide House Price Index recorded annual growth at 0.9% during April, while the Land Registry’s figures are similar at 0.6%.

This is the second time that Halifax’s figures have been questioned after it reported a 5.9% monthly increase in February.

Halifax said: “The sharp 5% rise in April’s annual change figure comes against the backdrop of a particularly low growth rate over the corresponding period in 2018, impacting year-on-year comparisons.

“This also factors in a notably high growth figure recorded in February this year, driven by a higher volume of London sales and more expensive new build properties.”

Commentators are more sceptical.

Lucy Pendleton, founder director of independent estate agents James Pendleton, said: “The blistering volatility of this index has returned as the Halifax house price weather vane spins itself into a frenzy once more.

“The index has already come under scrutiny this year after months of erratic monthly growth figures. These can be more sprightly than the smoothed annual and quarterly numbers, but even so, they’ve been turning heads with the extremes with which they have been moving.

“One explanation for ricocheting growth figures like this is persistently low stock levels. In sought after areas, this can lead to demand being supercharged one minute and gone the next.

“Even so, the Halifax index’s behaviour so far in 2019 has been unusual to say the least.”

There was also plenty of criticism from housing analysts on Twitter.

 

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