Halifax updates its house price index after criticisms of data

The Halifax House Price Index for August will be published this morning – and after coming in for some stick in recent months, will use updated technology.

Recent indices have been criticised as unreliable and unlikely, after they showed completely different results from other indicators.

The Halifax said that the existing methodology had been used for over 30 years.

The new technology has been a year in development and “subsequent enhancement” is also promised.

A spokesperson said: “The updated model reflects changes to the structure of the housing market and uses best practice in house price determination.

“It will include more mortgage transaction data for even greater accuracy and reduced volatility on a month to month basis.”

Today’s new index shows average house prices at £233,541, a 0.3% monthly rise with annual house price inflation at 1.8% – the highest that it has been since April, according to Halifax, and a figure that may not silence the critics.

According to the latest Nationwide index, annual house price inflation is now 0.6% and has been below 1% for nine consecutive months.

Russell Galley, managing director of Halifax, said: “Although the housing market will undoubtedly be influenced by events in the wider economy, it continues to show a degree of resilience for the time being.

“We should also not lose sight of the fact that the single biggest driver of both prices and activity over the longer-term remains the dearth of available properties to meet demand from buyers.”

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