House Prices Telling the real story
Making sense of house price statistics is less about being a slave to the movements themselves and more about understanding why the numbers move in the way they do. We take a look at the Acadametrics index for January
by Mark Graves, fi nancial services development director LSL Property Services and sales director at Pink
National house price statistics reports do not tell the whole story especially when there has been little or no movement in many of the headline fi gures over the last few months. In January the Acadametrics index
showed that average house prices fell by 0.1% across the country from £221,338 to £221,211. A negligible drop of £127. Across the year as a whole house
prices have risen by 0.6%. On a national basis prices have been almost completely static but in amongst these
fi gures there are a number of spikes or falls either around the country or in particular product areas. Making sense of these statistics
is less about being a slave to the movements themselves and more about understanding why the numbers move in the way they do.
CHICKEN OR EGG It can be easier to think about in terms of a working example. The Mortgage Works and BM Solutions have released good buy-to-let products that stimulate demand from investors. At the same time there has been extensive press cover- age suggesting the buy-to-let market is coming back and it’s a good time to buy investment properties. On the back of good rates and
enthusiastic reports more investors are
“A mismatch in sup- ply and demand with more properties than tenants gives the lat- ter the upper hand in price negotiations.”
entering the market. Add to that a fl at housing market and a general consen- sus that prices shouldn’t drop dramati- cally and you have a fl ood of interest in one particular sector of the market and in specifi c areas of the country where investment makes sense. But if a lot of people decide to buy at the same time then house prices can be
46 MORTGAGE INTRODUCER MARCH 2011
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