21 Nov House Price Analytics app shows how portals overestimate average prices
House Price Analytics is a new app that aggregates house price indices from multiple sources to offer a more accurate picture of the housing market, showing the London “property bubble” is smaller than reported.
Created by Agent Analytics and business intelligence specialist Roambi, the app reveals that house price portals such as Zoopla substantially over estimate the average values of London properties by using a mean average, which allows high-end properties (with one on for £68 million) to skew the figure.
The app incorporates data from Rightmove, Zoopla, ONS, Halifax, Nationwide, LSL and 18 years of house price data from HM Land Registry — which tend to offer wildly different figures — to help buyers and sellers better understand house prices. Through a series of interactive charts and infographics, the app makes it easy to grasp seasonal fluctuations, the average speed of sale of properties depending on region, and the average difference between asking prices and sold prices.
According to Zoopla, there are more than 1,200 properties listed in London with an average asking price of more than £5 million. A random sample of 10 properties valued at more than £20 million shows that many of them are listed with multiple estate agencies. These aren’t de-duplicated in the data and serve to skew the mean average even more.
This is partly why Rightmove says the average asking price for a property in London is more than £493,000, while ONS says it’s £433,000 and then Land Registry says the average sold price is £393,000. The difference between the mean and median average house price was a massive £96,000 in the capital.
The app offers up a snapshot of the market — presented in an interactive magazine format which uses Roambi’s Flow technology — revealing nuggets of information such as the fact that asking prices went up 2.8 percent in the last month, while sold prices only went up by 1.5 percent. London asking prices went up by 10.2 percent in the last year compared to 3.8 percent in the entire country.
Agent Analytics’ Richard Rawlings told Wired.co.uk that the app would help the problem of vendors, and in some cases agents, “habitually overpricing” by arming individuals with a more comprehensive picture of the market than is currently available in this sort of snapshot.
The company hopes to sell a premium version of the software — Agent Analytics — into estate agents, who will be able to plug the data into their own proprietary customer relationship management tools.
Rawlings said in a press release: “The use of data analytics to reveal misinterpretations in the reporting of house prices will prove to be an invaluable tool in the great UK property-price debate.”
The data in the app will be updated each month.