Tag Archives: Mean

The price of a house – a stupid average

The ONS published this week a new – I’d say conceptually more sound – experimental house price index. It is based on the stock of homes not the flow so tells us what’s happening to the whole market not the price of what’s just been sold.  The estimate of the average price is lower than under the old methodology – £194,000 compared to £215,000 in the old measure, about 10% lower. The stroke of the methodologist’s pen has made homes more affordable even though no prices have changed! Perhaps this is the time to reflect on the full range of house price estimates at our disposal – and, dare I say it, how meaningless the average numbers are? Depending on what you count and how you add the numbers up, the resulting averages can be wildly different, as much as £100,000 apart.  Continue reading The price of a house – a stupid average

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