How the ONS single-handedly knocked £100,000 off the average UK house price in April
Eagle-eyed house price watchers may have spotted something fishy about the official house price figures for April.
Yep: in the figures, published yesterday, the average UK house price was almost £100,000 lower than last month – dropping from £292,000 in March to just £209,000 in April.
Are those jitters over the EU referendum really having that bad an effect? Has George Osborne's three per cent stamp duty hike on buy-to-let homes caused a stampede as landlords tried to get out of the market?
The answer is a little more benign than that: it turns out the Office for National Statistics (ONS) has merely changed the way it calculates the average house prices. Essentially, it's changed how it does the maths.
Chief among the new measures was the decision to give "extreme valued property" – ie. ultra-expensive homes – less weighting in the measure.
"Prices can be skewed upwards by high value property," it said.
It also said it was including cash sales and new homes, in order to "provide full coverage of the housing market".
The result looks more like this:
Read more: Central London home-owners sell off to save up and move out
However, the classification of "extreme" has raised questions.
"For many the average London house price of £550,000 plus is extreme," said Russell Quirk, chief executive of online estate agent Emoov.
"Despite the ‘extreme’ end of the market only accounting for a very small percentage of UK property, it is still part of the market.
"Chopping and changing data sets and moving boundaries is a questionable practice, to say the least, and some may argue it has further skewed the portrayal of the UK market rather than honed it in any way. Yes they have been quick to point out that despite the reduction, the actual movement of the market has remained almost identical, but this is far from the point."
An ONS spokesperson said: “This is a purely technical change in calculating average house prices which has no impact on the real value of anyone's home. Nobody lives in the 'average house'.
“The UK average house price reported by the new ONS index is very similar to those produced by Halifax and Nationwide.”
How the ONS' changes look across the UK
| Old (Mar-16) | New (Apr-16) | Change £ | Change % | |
| England & Wales | £190,435 | £218,062 | £27,627 | 15% |
| London | £531,977 | £465,014 | -£66,963 | -13% |
| North East | £98,524 | £121,879 | £23,355 | 24% |
| Kensington & Chelsea | £1,374,508 | £1,310,285 | -£64,223 | -5% |
| Somerset | £179,327 | £206,300 | £26,973 | 15% |
| Wigan | £96,084 | £117,922 | £21,839 | 23% |