It is often said men are from Mars and women are from Venus.
Perhaps the same could be said if you compare the difference between the latest asking price and house price indices.
Rightmove’s September house price index had asking prices at £306,499 and Home.co.uk had values a little lower at £295,813.
But these are markedly higher than what buyers are actually paying, according to house price indices.
Halifax’s latest house price index had values at £213,930 while Nationwide’s is £206,145.
Land Registry data, reflecting sales, albeit only up to July, has values at £216,750.
So that is a gap of up to £100,000 between what sellers want and what buyers will pay.
Which planet do you think is right?
Comments (4)
Nationwide and Halifax data doesn’t include cash buyers, so they’re averages will always be lower than the true average.
The Land Registry HPI looks at the value of what they determine to be ‘the average house’ – Their method to calculate the mean discounts particularly expensive sales.
The Acadata HPI which uses Land Registry figures, but includes the sale of all properties puts the average value at £293,318. The method used is the same as Rightmove and Home.co.uk, which explains why the figures are closer.
There is gap between asking prices and sold house prices, but its more like 3% rather than 30%.
“Nationwide and Halifax data doesn’t include cash buyers, so they’re averages will always be lower than the true average.”
Surely that depends on the “average” cash purchase price and the proportion of cash purchases in relation to the whole?
“The Acadata HPI which uses Land Registry figures, but includes the sale of all properties puts the average value at £293,318. The method used is the same as Rightmove and Home.co.uk, which explains why the figures are closer.”
Rightmove and Home use ASKING PRICE data only. And BOTH exclude certain properties, for reasons best known to themselves.
“There is gap between asking prices and sold house prices, but its more like 3%…”
That depends entirely on who’s “asking prices” you are referring to!
Asking price averages are meaningless as anything other than as a comparison against a previous asking price average. The manipulation of asking prices to win instructions and the subsequent and necessary price reductions that go along with the sentiment ‘no-one went to jail for over- egging an asking price’ plus the antics of EAAs (ethics absent agents) portal jugglers and the like mean nothing more than this is the average of what has been listed.
The building society averages are really of any use to the bean counters in the building societies and those who profit from lending money.
Land registry have a very peculiar way of doing anything; duplications , errors, omissions, sales that simply do not exist, the inability to index and search their own database along with the fact only 36% of entries make up the averages quoted mean the land registry figure is a number that represents a consistent, inconsistent something, but not the average price of property.
There is no gap at all between what purchasers will pay and what vendors will accept that is fundamental supply and demand, the gap is an artificial one created by people who don’t really understand numbers, they are given out as press releases to journalists who don’t question them and so the myths are perpetuated.
Based on clean transaction data, actual completions of residential property, the market peaked at the end of March £290,000 dipped to £264k and by the end of July recovered to £285,480.
Who dislikes your hard work?????????