A single official house price index is required

Published ¤ 21/01/2011 13:34:55

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Jil Matheson, who as National Statistician is head of the Government's statistical service, said in a new report that the different measures available can look contradictory and cause "confusion".

"There is a great deal of interest in and importance placed on changes in the value of our houses by all sections of society," she said.

"I want to be sure that official statistics producers are providing the right statistics on house prices to support decision-making by us all."
An official house price index is requiredAt present, two official house price indexes are published - one by the Land Registry, which keeps track of who has the rights to a property, and the other by the Department for Communities and Local Government (DCLG).

The former index covers only England and Wales, while the latter covers the whole of the UK. The two indexes use different methods to calculate average house prices.
So, for October, the DCLG reported that house prices increased by 5.5pc over the year to an average £209,466.

However, the Land Registry said prices rose 3.4pc to an average of £165,505.

There are also a slew of unofficial indexes, such as the respected surveys from Nationwide and Halifax.
The various indexes often give conflicting impressions, leaving people struggling to work out whether it is a good time to buy or sell as they face a huge amount of data to wade through.

Furthermore, the rival indexes are released at different times - the DCLG, in particular, reporting about a month later than the unofficial indexes - creating a steady flow of data to contend with.
Ms Matheson wants a single official measure to cover the whole of the UK, based on the price when a house sale is completed, which would be released monthly.

The index should come with a regular report on how official figures compare with data from other sources, she said.
The Land Registry and the DCLG have now been tasked with working out how to produce just one set of data.

Ms Matheson hopes to report on the progress towards producing a single index by Easter 2011.
This article was published by The Telegraph on 17 December 2010. Click here to see the original article.

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