Halifax November: -0.9% MoM -0.6% QoQ -1.0% YoY

simonSE15

Batchy wrote: »

Noise... stagnation... Perfect!... no winners, no losers! Best middle ground possible!

stagnating downwards. :rotfl:

joguest

wotsthat wrote: »

So take two Nationwide figures (the last one and one from a year ago) and then two Halifax figures (today's and one from a year ago). Then compare against LR figures and conclude Halifax is more reliable than Nationwide?

You can't reach that conclusion based on subtracting the LR numbers from Halifax and Nationwide.

Given that the graph shows a good correlation between the indexes aren't any individual points just noise?

What's the source of 'noise'? There isn't any noise (unless there's some underlying physical mechanism relating to house prices that I don't know about - are they affected by cosmic radiation?). There is a sampling error (technically the 'standard error'). But even the expected values of the standard error fall well below the divergence of ~5% between the Nationwide and LR over the last 12 months.

joguest

Also, the normalised standard error for the percentage change in house prices between two points in time decreases with the inverse of the time period. So, comparing two points a year apart (to derive a percentage change) is more accurate (as well as being more meaningful) than comparing the percentage change between two successive months.

edit: Actually, this is only true if the YoY changes are bigger than the average monthly changes, which isn't true at the moment. However, a ~5% difference between Nationwide YoY and LR YoY is significant as it is above the level of typical monthly and yearly changes. It's at a similar level of oddness as the Halifax -3.6% monthly fall last year.

wotsthat

joguest wrote: »

What's the source of 'noise'? There isn't any noise (unless there's some underlying physical mechanism relating to house prices that I don't know about - are they affected by cosmic radiation?). There is a sample error (technically the 'standard error'). But even the expected values of the standard error falls well below the divergence of ~5% between the Nationwide and LR over the last 12 months.

So what explains it? Are we seeing the Nationwide index diverge away from the historic correlation?

Taking three YoY numbers and concluding that one is more reliable than another isn't good stats - you wouldn't get away with it at GCSE let alone here.

Batchy

simonSE15 wrote: »

stagnating downwards. :rotfl:

Most people are paying the mortgages down more than 1% its not going to cause many problems is though?

joguest

wotsthat wrote: »

So what explains it? Are we seeing the Nationwide index diverge away from the historic correlation?

Taking three YoY numbers and concluding that one is more reliable than another isn't good stats - you wouldn't get away with it at GCSE let alone here.

I got away with a PhD from a Russell Group University (a substantial part of which comprised an analysis using Higher Order Statistics). I must have been lucky in not being examined by the internet experts at MSE.

ILW

joguest wrote: »

the normalised standard error for the percentage change in house prices between two points in time decreases with the inverse of the time period. .

I was going to say that.

AD9898_2

Surely these indices are next to useless. Approvals are way down on the historical norm, and Halifax and Nationwides' are therefore pretty irrelevant.

It pains me to say that I can't see any significant fall in the near future. The Market is shifting away from average earners/people owning their own home like in the past, what we have now is rich BTLers taking these homes and with no regulation likely to stop it, it will continue and get worse.

It's a real pity that this gulf between the 'haves' and 'have nots' will continue to grow but the people that have the power to stop it are too weak and greedy to do anything about it.

wotsthat

joguest wrote: »

I got away with a PhD from a Russell Group University (a substantial part of which comprised an analysis using Higher Order Statistics). I must have been lucky in not being examined by the internet experts at MSE.

Good for you.

Does that mean taking a single Nationwide YoY, a single Halifax YoY and deciding that Halifax is more accurate because it's closer to a single LR YoY is good stats then?

joguest

Does that mean taking a single Nationwide YoY, a single Halifax YoY and deciding that Halifax is more accurate because it's closer to a single LR YoY is good stats then?

I didn't say it makes the Halifax more accurate. That is an absolute statement. This is what I did say:

"The Nationwide is around 5% higher YoY than the LR (-3.2% YoY), so one would assume the 'fax is currently more reliable. "

"At the moment, the nationwide is (unusually) the most out of step with the LR figures (the only figures that really count). "

Notice the words:
'assume' - an assumption is not the same thing as claiming to have proved a hypothesis
'currently' - meaning at this point in time - i.e. it's not a claim that the Halifax is more accurate throughout its history
'unusually' - this implies that I think the Nationwide is usually more accurate - more accurate in the sense that it better tracks the LR data

Yes, it is good stats to compare the YoY figures between the three and come to the conclusion that, over that time period (which is more meaningful for purposes of looking at purchasing /selling decisions for houses), the Halifax is showing a better agreement with the LR. If I'd made some wild, speculative hypothesis on the basis of the observation then you would be right to tear me apart. However, I didn't - all I did was state (not unreasonably) that the Halifax YoY is showing a closer agreement to the LR YoY (the figures based on actual sales, that we assume to be most accurate) than the Nationwide, which has drifted uncharacteristically to a ~5% difference in the trend over the last 12 months (albeit the LR is delayed).

I suspect the gap will close over the next few months.