Nationwide Prediction

Pimperne1

Nationwide has shown a pretty dramatic increase in house prices this year with the following:

Jan £161,602
Feb £161,183
Mar £164,751
Apr £165,609
May £167,208
Jun £168,205

The two recent peaks have been:

Jun 10 £170,111
Oct 07 £186,044

The transaction numbers are so low that I have been sceptical about the reliability of the figures but those others who understand this better than I content that even low transactions are a reliable method of assessing the market - who am I to argue.

Anyway, as for this months figures, due on Friday, will they move the figure closer to the Jun 10 peak or will this be the month where the "second leg down" starts?

My forecast (guess, prediction) is that the figure will be within 0.1 percent of last month and that it will be upward.

Here is a well know forecasters prediction:

"Forecasts nominal: 10% fall 2011. 25-35% fall from Summer 2010 to Summer 2013"

Aberdeenangarse

Pimperne1 wrote: »

will this be the month where the "second leg down" starts?

Is that after the first legover

Loughton_Monkey

Pimperne1 wrote: »

The transaction numbers are so low that I have been sceptical about the reliability of the figures but those others who understand this better than I content that even low transactions are a reliable method of assessing the market - who am I to argue.

I don't know who you are to argue.

But you should understand that the transaction numbers have nothing to do with the 'index'. The index is a factual construction of the average prices of houses they have mortgaged over the month.

If they were involved in one transaction only, for a house valued at £1 million, then their 'average' house price would rise to £1 million - a rise of about 500% in one month. This figure would be "correct" and "accurate".

So although the index is "reliable", the interpretation of it is not. For it to be interpreted as a factual house price increase, you have to assume that the houses involved in Nationwide transactions are fully representative of the market as a whole. i.e. that the mix of type/style/location.... of houses changing hands is representative of the whole market.

SInce this is most unlikely, the indices are simply a rough guide.

Pimperne1 wrote: »

Here is a well know forecasters prediction:

"Forecasts nominal: 10% fall 2011. 25-35% fall from Summer 2010 to Summer 2013"

And my postman swore blind that they will rise by 50% by the summer of 2013.

So tell us all who your "well known forecaster" is, and let us decide whether or not yours is likely to be more reliable than my postman.

Really2

Loughton_Monkey wrote: »

If they were involved in one transaction only, for a house valued at £1 million, then their 'average' house price would rise to £1 million - a rise of about 500% in one month. This figure would be "correct" and "accurate".

I have been corrected on the above before (as I thought the same). That is where the mix adjustment etc comes in.
That house would be subject to all sorts of corrections for size area etc.
So if prices were static on that house (compared to what they thought last month) the average should still be the same as last month, not £1m.

Loughton_Monkey

Really2 wrote: »

I have been corrected on the above before (as I thought the same). That is where the mix adjustment etc comes in.
That house would be subject to all sorts of corrections for size area etc.
So if prices were static on that house (compared to what they thought last month) the average should still be the same as last month, not £1m.

OK. My example was extreme. But the thrust still stands. We still have to remember that the bag of 3-bed semi's sold in Northamptonshire last month, is not necessarily going to reflect accurately the different bag of 3-bed semi's sold the following month in the same area.

Blacklight

There are some brief periods of drops (recession, negative growth, blips... call it what you like) but the trend is only ever upwards.

The question is, when?

It's been four years since the peak so my guess is Soon™

geneer

Nationwide being one of the indices pimperne1 repeatedly tells us are worthless.

geneer

Pimperne1 wrote: »

Here is a well know forecasters prediction:

"Forecasts nominal: 10% fall 2011. 25-35% fall from Summer 2010 to Summer 2013"

Linky please.

Aberdeenangarse

geneer wrote: »

Linky please.

I assume he means this one?

Numpty - Jonathan Davis - Date of prediction - Oct 2010 - down 40-50 % Time period - 2007-2013


http://www.housepricecrash.co.uk/

Pimperne1

Loughton_Monkey wrote: »

I don't know who you are to argue.

But you should understand that the transaction numbers have nothing to do with the 'index'. The index is a factual construction of the average prices of houses they have mortgaged over the month.

If they were involved in one transaction only, for a house valued at £1 million, then their 'average' house price would rise to £1 million - a rise of about 500% in one month. This figure would be "correct" and "accurate".

So although the index is "reliable", the interpretation of it is not. For it to be interpreted as a factual house price increase, you have to assume that the houses involved in Nationwide transactions are fully representative of the market as a whole. i.e. that the mix of type/style/location.... of houses changing hands is representative of the whole market.

SInce this is most unlikely, the indices are simply a rough guide.




And my postman swore blind that they will rise by 50% by the summer of 2013.

So tell us all who your "well known forecaster" is, and let us decide whether or not yours is likely to be more reliable than my postman.

http://www.youtube.com/watch?v=5hfYJsQAhl0

wherediditallgothen

Aberdeenangarse wrote: »

Is that after the first legover

No it's after you've smoked the cigarette.