Nationwide "Real" House Price Index rose 1.6% in June

Spiv_2

Nationwide's "Real" House price Index recorded an increase of 1.6pc in June, compared to the "doctored", or seasonally adjusted, figure of + 0.9pc.

This is the fifth consecutive month that the widely reported seasonally adjusted figures have shown worse figures than the real ones. The cumulative difference between these two figures in the first 6 months of this year is 1.9pc

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/5765162/Comment-House-prices-will-rise-this-year.html

HousingBear

Funny. I don't remember any calls from Ray to report the rate of real falls during the winter of 2007 and 2008. Seasonally adjusted only seasonally acceptable, are they?

ad44downey

They're bogus figures anyhow. The land registry figures are the proper ones and they haven't shown a rise in years.

JonnyBravo

Retrospective adjustments in statistics for the previous month or two are quite common but if it takes a whole year to calculate what adjustments are needed to seasonally adjust the figures the results are further devalued. In fact I can't but wonder if the regular adjustment of the seasonally adjusted figure for 12 months previously means that this is in effect a balancing figure of some sort!
In a market where factors other than the seasons have become more important in affecting house prices, such as the availability of mortgage finance and the level of mortgage rates, it becomes increasingly difficult to work out what typical price movement could be expected purely because of the time of year and hence what the seasonal adjustment should be.
Hence my view that it makes more sense to report just the real figures and allow everyone to make their own interpretation as to how much of an influence the season is.

Hmmm.... seems to me as if they are doing some extra "storing up" of increases in price in case there are drops ahead in the winter. These "stored up" gains can then be used to offset the drops.

Of course in the end we end up in the same place but this is the Nationwides attempt to smooth the figures. I guess this wouldn't need to be done if people didn't read so much into one months figures but of course in our society today, every scintilla of news, be it good or bad, is reported instantly and then magnified 1000x

Generali

There are very good reasons to use seasonal adjustment on stats such as house prices and unemployment figures. It's because they change predictable throughout the year so it's good to be able to see the change without the 'noise'.

It is clear that UK house prices are rising now. Whether that will continue to happen over the next couple of years is a matter for debate. I think further falls are highly likely but then again I've been wrong before (incredible I know but I have).

IveSeenTheLight

JonnyBravo wrote: »

Hmmm.... seems to me as if they are doing some extra "storing up" of increases in price in case there are drops ahead in the winter. These "stored up" gains can then be used to offset the drops.

Of course in the end we end up in the same place but this is the Nationwides attempt to smooth the figures. I guess this wouldn't need to be done if people didn't read so much into one months figures but of course in our society today, every scintilla of news, be it good or bad, is reported instantly and then magnified 1000x

There is a good possibility that the end of the year will see approx 0% YoY results

JonnyBravo

Generali wrote: »

There are very good reasons to use seasonal adjustment on stats such as house prices and unemployment figures. It's because they change predictable throughout the year so it's good to be able to see the change without the 'noise'.

It is clear that UK house prices are rising now. Whether that will continue to happen over the next couple of years is a matter for debate. I think further falls are highly likely but then again I've been wrong before (incredible I know but I have).

May be... maybe not. It's all slightly immaterial to my mind if you know the seasonal adjustment anyhow.

What is more "unusual" is that the article seems to be suggesting they are adjusting the seasonal adjustment some months after it's initially been reported and why and by how much seems to be very much finger in the air stuff

JonnyBravo

IveSeenTheLight wrote: »

There is a good possibility that the end of the year will see approx 0% YoY results

Certainly seems more likely than it seemed 6 months ago.

dfh

I hope we never see the crazy double digit house price inflation we saw between 02 and 07.We will be paying the price for that for years.

System

IveSeenTheLight wrote: »

There is a good possibility that the end of the year will see approx 0% YoY results

Oi! That's my prediction! get your own!

ad9898_3

With the indices showing -9.3% to -17% YoY and the the best 6 months of selling now behind us, and the long dark autumn/winter months in front, I would be very surprised if the YoY figures get close to 0%.

On another note what will likely be positive by the end of the year will be the YoY inflation figures when $147 oil and those large IR cuts fall out of the equation, and that's to say nothing of the 2.5% VAT to go back on at the end of the year.