A reader wrote in last week to tell me that Halifax’s claim that annual house price growth reached 4.1% in January doesn’t tally with what he’s seen.
He told me that properties around Watford and Bournemouth have actually fallen in value by 15% year-on-year, which he said was based on contact with friends and family as well as the general public.
Whether he’s right or wrong, I think his criticism highlights an issue with many of our house price indices– headline figures completely mask what’s happening in different regions of the UK.
Whether you’re going on what Halifax or Nationwide report, what’s happening in densely populated areas of the UK, like London, can completely skew how the country is performing overall.
The most reliable property price index around is probably the government’s UK House Price Index, which comes from Land Registry data, and to its credit it does split data into different regions of the UK like the North East and North West of England for example.
However that data is so historic (the November 2019 report came out on January 15) that many of the trends, both nationally and regionally, have already been reported elsewhere by the time it comes to print.
I’ve always had a soft spot for the Zoopla Cities House Price Index, previously the Hometrack UK Cities House Price Index (I promise Zoopla isn’t paying me to write this) because it gets in depth by comparing how different cities are performing.
I’d like to see more indices having that approach, as it’s far more helpful than concentrating on how the UK is performing on average – as an investor to an extent it doesn’t matter how things are going nationally as long as you’re investing sensibly in whichever regional market you operate in.
Of course I’m not blameless here.
It’s also up to us journalists to delve deeper into the data to spot regional trends, so we can all get a clearer picture of how the housing market is performing, wherever we live.
Ryan Bembridge, Editor, PropertyWire
