"Hopes for housing recovery dashed" FT (online) - 30.04.2009

Author: Simon Whittaker Posted on: 30 April 2009

So reads the FT (online) headline this morning.   And the article continued “.... after the Nationwide revealed prices fell in April.  The closely-watched Nationwide House Price Index had recorded a small rise in March after 16 months of consecutive falls. But on Thursday the building society reported a 0.4 per cent drop in prices in April, after a rise of 0.9 per cent in March and conflicting signals from other house price indices.”

Categoric isn’t it – any green shoots that you might have thought you had seen were a mirage.

But the Nationwide’s own headline was “House prices fall slightly in April” – not quite so bad is it?  And if you actually read the press release you will discover that prices actually rose by 0.6% in April – its just that they then apply a 1% seasonal adjustment to allow for the usual Spring surge in prices to come up with a (seasonally adjusted) price fall of 0.4%.

In the words of Benjamin Disraeli there are “Lies, Damned Lies and Statistics” – and if you then put those statistics in the hands of a journalist you can turn the truth totally on its head.  I stand by what I said at the start of the month – expect confusing data for the next two quarters but start looking out for opportunities as the property market levels out and as buy to let mortgages remain at their current bargain basement prices for medium term fixes

 

Author: Simon Whittaker