Confusing Times

With the vast media coverage on the housing market and current state of the economy, one of the most widely used tools for measuring the growth of the housing market is being manipulated by many media sources to create dramatic headlines. This tool is known as a house price indice.
House price indices work on the basis that over the same measurable length of time they track results in house sales or demand to ascertain whether the market is in growth or decline. However, there are many ways in which this can be misconstrued and distorted.
A well publicised result from the Halifax indice recently showed that prices had in fact taken the biggest single monthly drop on record, 3.6%. This created a very shocking headline and was one of the lead stories in many of the national newspapers. However, what they fail to mention in many of the articles is that in fact this is a biased survey in favour of houses which have been purchased using a mortgage provided by Halifax. This means the survey results are being generalised to the whole of the market, which is a vast misrepresentation of what is truly happening.
An independent survey by Acadametrics showed that in fact during September there was a 0.2% INCREASE in house prices. This survey takes it’s source information from Land registry figures, which documents every property transaction in the country, taking into consideration purchases where a mortgage has been used from every lender and also from cash purchasers.
This survey gives a far more accurate guide to prices because it is not biased and it does not generalise it’s results.
For the best advice, you should consult several well known and trusted agents in your area as well as local solicitors and financial advisers, as these are the people on the property front line who know what is really going on.
Stevan Injac, Branch Manager
Mather Marshall Estate Agents, Hitchin

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