The Halifax have released their latest house price index today.
Their numbers show that home values DROPPED 0.5% in February compared to January.
As ever, the monthly indices are at odds with each other. Last week saw figures from HM Land Registry and from Nationwide that suggest prices are UP. And this contrast has been evident for some months.
Much of the contradiction can be put down to a difference in time period over which each analysis is taken, particularly with regard to the HM Land Reg stats which are based upon COMPLETIONS rather than mortgage approvals and which will always be out of synch with each other by three months or so. There are regional variances too in that, although all of the figures are national, the Halifax client base is weighted toward the north.
Regardless, those interested in buying or selling would be wise not to make too much of one set of numbers from each source in isolation.
the eMoov overall ‘index of indexes’ shows a broadly flat picture of values whereby prices are largely unchanged in recent months. And in any case, enough of this sitting on the market fence waiting to see what values do. A house is not the FTSE or a Gilt, it’s a home and should perhaps not be over analysed as some financial instrument that’s future value is second guessed by all and sundry to the detriment of transactional volumes.
The real issue on house prices is, in any case, not one of whether prices are going up or down in any wild fashion. It’s an issue whereby there is STILL a 15% ‘reality gap’ between UK asking prices and prices that are actually being achieved by sellers nationally overall. That’s according to the differential between the Rightmove house price index (asking prices) and the Halifax house price index (sold prices). Asking prices are simply being set too high by over optimistic sellers and inaccurate estate agents, scared of losing new instructions through the revelation of honesty.
Whilst that no man’s land exists, the market will suffer more than at the hands of arguing house price indices.