A “desperately poor year” for housing

The property-market bulls seem to think that 2005 has gone their way. But we aren't so sure. House price figures can be 'cherry-picked' to suit either side of the debate, but one fact can't be argued with - that transactions fell to a 30-year low during the year.

The property-market bulls seem to think that 2005 has gone their way. Listen to Fionnuala Earley, Nationwide's chief economist. She told The Independent last week that the bears have been "eating humble pie" lately: instead of crashing, she says the housing market has shown "resilience" and "stability" in 2005, with annual house-price growth (through November) coming in at 2.4%.

But does this really count as good news? We aren't so sure. As Jim Pickard points out in the FT, the flood of data into the housing market is both volatile and contradictory. No two indices tell us the same thing something that means that both sides in the great housing debate can "cherry pick" the numbers that suit their case. At MoneyWeek, we would point to the fact that, even if the Nationwide's figures were an accurate reflection of prices in the UK, if you adjust them for inflation, the average house price is up a mere 0.3% on the year so far. Hardly enough to make bears feel humble!

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Emma Thelwell

Emma is a former digital journalist with more than 15 years of experience in national news in the UK and overseas. She was an assistant editor at MoneyWeek, covering property, funds, alternative investments and the share tips pages, then Emma moved on to The Daily Telegraph, first as a personal finance reporter and then as a business reporter. 

Emma also worked as a finance correspondent for Ninemsn (Australia’s Channel 9 online) in Sydney, Australia for just over a year, and since then Emma has worked at Channel 4 News as a reporter and producer, and she spent more than 4 years at BBC online. At present Emma is a senior manager for content and thought leadership at PwC.