Findaproperty.com House Prices and Affordability Index March 2010

findaproperty

Findaproperty.com House Prices and Affordability Index March 2010

MARCH 2010

Contents

Affordability Improves As Lenders Relax Criteria,

But First-Time Buyer Prices Are Rising .................................................1

Overview & Commentary: The National Picture ....................................2

Overview & Commentary: The Regional Picture ...................................3

Overview & Commentary: Supply..........................................................3

Property Prices (National) .....................................................................4

National Property Prices By Size...........................................................5

First-Time Buyer Affordability.................................................................6

Regional Property Price Analysis ..........................................................7

Regional First-Time Buyer Affordability .................................................8

London Boroughs ..................................................................................9

Supply Vs. Asking Price.......................................................................10

About The Methodology ...................................................................... 11


Overall Prices Are Steady

But Rise Year-On-Year



Asking prices are up just 0.1%, having

remained stable last month

Average price of £217k is

1.7% up on March 2009

After 12 Months Of Stability,

First-Time Buyer Prices

Are Up This Month



Entry level properties have remained largely

stable for 12 months but rise 0.4% in March

Average first-time buyer home costs

£154,720, compared with £154,684 last year

Affordability Helped By

Relaxation Of Lending Criteria



Deposit required by first-time buyers

falls to £51,700 from £55,200

Affordability gap drops to below 20 months’

average income for the first time

Stocks Growing, But

Remain Tight



Stocks rise for two months in a row, but

remain 15% below March 2009 levels

More supply will be needed in response

to growing demand in the spring

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

MARCH 2010

Affordability Improves As Lenders Relax Criteria,

But First-Time Buyer Prices Are Rising

Property Asking Price Data

£240K

£230K

£220K

£210K

£200K

£300K

£250K

£200K

£150K

Mar-10 Feb-10

Av. Property Price £217,006 £216,821

% Change (month) 0.1% 0.0%

% Change (year) 1.7% 0.8%

£231K

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£282K

£176K

UK A s king Pric e

First-Time Buyer and Home Mover Prices

Mar-10 Feb-10

Av. FTB Property Price £154,720 £154,036

% Change (month) 0.4% 0.0%

% Change (year) 0.0% -1.5%

Av. Home Mover Price £274,791 £276,038

% Change (month) -0.5% -0.4%

% Change (year) 3.6% 3.6%

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UK FTB A s king Pric e UK Home Mov er A s king Pric e

£217K

£275K

£155K

First-Time Buyer Property Price / Income Ratio

M ultiple of inc om e

5.7

5.5

5.3

5.1

4.9

4.7

4.5

5.6

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4.8

[ 1 ]


Overview & Commentary: The National Picture

National Property Prices

Asking prices rose by 0.1% or £185 this month. Over

the past year, they have risen 1.7% from £213,478 in

March 2009 to £217,006 this month.

Following modest seasonal declines between

November and January, prices stabilised last month and

are now heading gradually upwards.

First-Time Buyer Homes

Entry level homes rose 0.4% this month to £154,720,

and are almost unchanged from a year ago (£154,684),

having seen a high degree of stability over the 12-month

period.

First-Time Buyer Affordability

Relative to incomes, house prices remain at 4.8

times the average gross household earnings of first-time

buyers.

However, with a significant relaxation of lending criteria,

buyers are able to raise larger mortgage loans. As a result,

they now need to find an average of £51,700 – down from

£55,200 last month.

This represents just over 19 months’ income – the first

time the affordability gap has fallen below 20 months.

Home Mover Prices

For existing homeowners who wish to move, property

prices have continued to slide since the autumn, with a

0.5% fall this month following last month’s 0.4% decline.

The average home mover property now costs just

under £274,800, almost £12k or 4.2% less than in October

2009.

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

Differences Between

Flats And Houses

MARCH 2010

Flats rose 0.3% this month, having remained largely

stable for the previous three months. Year-on-year they

are up 1.2%.

Houses were flat this month, and are 1.8% higher than

a year ago.

Prices By Property Size

Larger properties declined in value this month (5+ bed

houses down 0.7% and 3+ bed flats down 0.6%) while all

other property types rose by between 0.1% and 0.5%.

On an annual basis, however, larger homes have generally

outperformed smaller ones, with 5+ bed houses up

5.4%, 3+ bed flats up 3.9% and 4 bed houses up 2.0%.

The only property type to fall in value over the year was

the 2 bed house, which declined by 0.3%.

[ 2 ]


Overview & Commentary: The Regional Picture

Regional Property Prices

The housing market continues to be stronger in the

south than the north: in London and the South East, asking

prices rose 0.3% this month, and annually by 8.7% and

5.6% respectively. In the South West prices are up 1.5%

over the year, but did decline by 0.5% this month.

The four regions in the north and east saw rebounds

this month, although prices remain lower than a year ago.

The North East was up 0.7% month-on-month, Scotland

and the East Midlands 0.4%, and Yorkshire & the Humber

0.1%. In those regions annually, prices are down between

6.2% (Yorkshire & the Humber) and 2.4% (the North

East).

London Property Prices

London continues to be the most buoyant part of the

country, with an annual increase of 8.7% – the largest

rise since the FindaProperty House Prices and Affordability

Index began. This month asking prices rose 0.3% or

£1,360 to £437,464. That is just £170 less than the peak

registered in November.

Across the capital, prices fell this month in only four

boroughs (the City, Redbridge, Waltham Forest and

Harrow) and rose in the remaining 29. The biggest winners

were Greenwich (+3.3% to £264,184), Haringey (+2.3% to

£461,992), Kensington & Chelsea (+2.0% to £1,059,350)

and Hackney and Newham (both +1.9%, to £356,285 and

£234,007 respectively).

Annually, more expensive boroughs have tended to

outperform cheaper ones - although some boroughs with

below average prices have seen double digit annual rises

(eg Newham +11.7% and Hackney +15.1%).

Overview & Commentary: Supply

Having fallen in December and January, stocks have

now risen for two months in a row, and have almost reached

the levels of last June. However, they remain 15% lower

than this time last year, and a significant inflow of properties

on the market will be needed in the next month or so

to meet the expected growth in demand.

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

MARCH 2010

The top five most expensive boroughs all recorded

double digit increases, with Kensington & Chelsea up 10.0%

(to £1,059,350), Westminster up 15.1% (to £973,359),

Camden up 14.8% (to £704,647), Hammersmith &

Fulham up 14.6% (to £661,197) and the City up 11.7% (to

£511,633).

Regional Affordability

With the relaxation of lending criteria, all parts of the

country have enjoyed an improvement in first-time buyer

affordability – although the overall pattern in terms of

regional variation is unchanged.

In the North East, the average deposit required after

buyers have secured their maximum loan fell to just £6,575

or 0.2 times household income. The two Midlands regions

were the next most affordable, with an average deposit

of just half gross income (£14,951 for the East Midlands,

£15,465 for the West Midlands). Scotland and the East of

England also enjoy better than average affordability, necessitating

a deposit of 0.9 times income.

Affordability remains worst in southern parts of the

country, including Wales. After London, the average

deposit required is highest in Wales (2.0 times income, or

£47,642), the South East (1.9 times income, or £67,782)

and the South West (1.5 times income, or £49,064).

London Affordability

In the capital, property purchase remains tough for first-

time buyers, requiring an effective deposit of £130,155.

Although this figure is some £3,800 less than last month

(thanks to the relaxation of lending criteria) it remains 3.5

times household income – the highest in the UK.

Stocks of first-time buyer homes have grown more

rapidly than the market overall. There are now 11% more

entry level properties available than in January (compared

with +9% for the market generally). But first-time buyer

property stocks remain 12% down on this time last year.

[ 3 ]


Property Prices (National)

Asking Prices – All

Prices are up 0.1% on last month, and up 1.7% on a

year ago.

Average asking prices are £217,006, compared with

£213,478 in March 2009.

Asking PricesHouses

Prices for houses were stable in both February and

March and now stand at £237,438.

This represents an increase of 1.8% on March 2009,

when they stood at £233,167.

Asking Prices – Flats

Flats rose 0.3% in March, and 1.2% year-on-year.

The average asking price is £174,866, 1.2% higher

than a year ago (£172,870).

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

Asking Prices (All)

% Chan g e

% C h an g e

1.5

1

0.5

0

-0.5

-1

-1.5

-2

-2.5

1.5

1

0.5

0

-0.5

-1

-1.5

-2

MARCH 2010

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All p ro p e rtie s a s kin g p rice m o n th ly ch a n g e

3 p e r. Mo v. Avg . (All p ro p e rtie s a s kin g p rice m o n th ly ch a n g e )

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H o u s e s P rice Mo n th ly C h a n g e

Mar-10 Feb-10

Average Property Price £217,006 £216,821

% Change (month) 0.1% 0.0%

% Change (year) 1.7% 0.8%

Asking Prices (Houses)

Mar-10 Feb-10

Average House Price £237,438 £237,397

% Change (month) 0.0% 0.0%

% Change (year) 1.8% 1.1%

Asking Prices (Flats)

% Change

1.5

1

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0

-0.5

-1

-1.5

-2

-2.5

-3

3 p e r. Mo v. Avg . (H o u s e s P rice Mo n th ly C h a n g e )

Mar-10 Feb-10

Average Flat Price £174,866 £174,386

% Change (month) 0.3% 0.0%

% Change (year) 1.2% 0.0%

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F lats P ric e M onthly Change

3 per. M ov. A vg. (Flats P ric e M onthly Change)

[ 4 ]


National Property Prices By Size

HousePrices By Size

Larger houses have performed better than smaller

ones over the past year, with a 5.4% rise in 5+ bed houses

and a 2.0% rise in 4 bed houses. In contrast, 3 beds rose

by just 0.8% and smaller 2 bed houses recorded a modest

decline of 0.3%.

This month, however, the larger categories were less

buoyant, with 5+ beds down 0.7% and 4 beds rising just

0.1% – compared with a 0.3% rise for smaller 2 or 3 bed

houses.

Flat – Prices By Size

Large flats with 3+ beds have performed best over

the past year, with a 3.9% increase in asking prices. This

compares with 1.0% and 0.6% rises for studio/1 bed and 2

bed flats respectively.

This month, 3+ bed flats declined slightly, however

(0.6%), while smaller ones rose by between 0.3% and

0.5%.

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

HousePrices By Size

Average House

Price

MARCH 2010

2 Bed 3 Bed 4 Bed 5+ Bed

£147,625 £191,047 £325,581 £530,988

% Change (month) 0.3% 0.3% 0.1% -0.7%

% Change (year) -0.3% 0.8% 2.0% 5.4%

£600K

£500K

£400K

£300K

£200K

£100K

£503K

£531K

£337K £326K

£207K £191K

£162K £148K

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2 Bed Hous e 3 Bed Hous e 4 Bed Hous e 5+ Bed Hous e

Flat – Prices By Size

£350K

£300K

£250K

£200K

£150K

£100K

Average Flat

Price

Studio

&1 Bed

2 Bed 3+ Bed

£130,857 £177,772 £303,581

% Change (month) 0.3% 0.5% -0.6%

% Change (year) 1.0% 0.6% 3.9%

£307K

£201K

£149K

£304K

£178K

£131K

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Studio & 1 Bed Flats 2 Bed Flat 3+ Bed Flat

[ 5 ]


First-Time Buyer Affordability

Asking Prices – First-Time Buyer

First-time buyer homes rose 0.4% this month, to

£154,720. They have seen a high degree of stability over

the past 12 months, and are almost unchanged since March

2009 (£154,684).

First-Time Buyer Property

Price / Income Ratio Vs First-

Time Buyer Mortgage Value

Chart shows first-time buyer property prices in

relation to average household incomes – and how

much borrowers need to raise once they have

secured a typical mortgage (based on latest CML

income multiples) – the affordability gap.

House prices remain at 4.8 times the average gross

household earnings of first-time buyers, compared with

5.6 times two years ago.

Affordability Gap As

Multiple Of First-Time Buyer

Gross Annual Income

Chart shows the multiple of gross annual

household income first-time buyers will have to

raise once they have secured their mortgage.

The affordability gap has reduced to 1.62 times gross

household income (representing just over 19 months of

earnings), as lenders have relaxed lending criteria.

Affordability Gap

(£ Deposit Required)

Chart shows the affordability gap in cash terms.

With first-time buyers able to raise larger mortgage

loans, they now need to find an average of £51,700 – down

from £55,200 last month.

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

Asking Prices (First-Time Buyer)

£180k

£175k

£170k

£165k

£160k

£155k

£150k

M ultiple of inc om e

6.0

5.0

4.0

3.0

2.0

1.0

0.0

MARCH 2010

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First-Time Buyer Affordability Gap Narrows

FT B A FFORDA BIL IT Y GA P

FTB Property Pric e/Inc ome Ratio

FTB Mortgage V alue/Inc ome V alue

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FTB Property Price / Income Ratio vs CML FTB Mortgage Value / Income

Ratio (multiple of income which lenders are lending to FTBs)

of First-Time Buyer gross annual income)

2.5

2.0

1.5

2.26

M ultiple of inc om e First-Time Buyer Affordability Gap (multiple

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Amount of Deposit required expressed as multiple of FTB average

household income, sufficient to buy typical FTB home after obtaining

mortgage achievable with FTB income

Affordability Gap (£ deposit required)

£75k

£70k

£65k

£60k

£55k

£50k

£71K

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Amount of Deposit required sufficient to buy typical FTB home after

obtaining mortgage achievable with FTB average household income

1.62

£52K

[ 6 ]


Regional Property Price Analysis

Media Enquiries:

Scotland Mar-10 Feb-10

Average property price £150,348 £149,749

% change (month) 0.4 1.2

% change (year) -2.5 -3.5

North West Mar-10 Feb-10

Average property price £157,696 £158,027

% change (month) -0.2 -0.5

% change (year) -4.9 -5.6

West Midlands Mar-10 Feb-10

Average property price £174,678 £175,314

% change (month) -0.4 -0.4

% change (year) 0.9 -1.5

Wales Mar-10 Feb-10

Average property price £170,834 £171,470

% change (month) -0.4 -2.0

% change (year) -2.9 -2.8

South West Mar-10 Feb-10

Average property price £238,268 £239,460

% change (month) -0.5 0.1

% change (year) 1.5 1.5

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

MARCH 2010

UK TOTAL Mar-10 Feb-10

Average property price £217,006 £216,821

% change (month) 0.1 0.0

% change (year) 1.7 0.8

North East Mar-10 Feb-10

Average property price £150,681 £149,686

% change (month) 0.7 -0.1

% change (year) -2.4 -2.5

Yorkshire & Humber Mar-10 Feb-10

Average property price £157,663 £157,569

% change (month) 0.1 -2.2

% change (year) -6.2 -6.2

East Midlands Mar-10 Feb-10

Average property price £170,196 £169,518

% change (month) 0.4 -1.0

% change (year) -2.2 -2.9

East of England Mar-10 Feb-10

Average property price £212,483 £212,712

% change (month) -0.1 0.4

% change (year) 1.0 1.4

London Mar-10 Feb-10

Average property price £437,464 £436,101

% change (month) 0.3 0.7

% change (year) 8.7 8.0

South East Mar-10 Feb-10

Average property price £274,185 £273,433

% change (month) 0.3 0.6

% change (year) 5.6 4.1

[ 7 ]


Regional First-Time Buyer Affordability

Media Enquiries:

Scotland Mar-10 Feb-10

Average FTB price £109,538 £109,104

FTB Property Price/FTB Income 4.1 4.1

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

£23,992 £27,012

0.9 1.0

North West Mar-10 Feb-10

Average FTB price £113,968 £113,426

FTB Property Price/FTB Income 4.3 4.2

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£27,862 £30,796

1.0 1.2

West Midlands Mar-10 Feb-10

Average FTB price £118,409 £118,341

FTB Property Price/FTB Income 3.7 3.7

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£15,465 £19,554

0.5 0.6

Wales Mar-10 Feb-10

Average FTB price £122,558 £122,882

FTB Property Price/FTB Income 5.3 5.3

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£47,642 £50,990

2.0 2.2

South West Mar-10 Feb-10

Average FTB price £155,939 £155,526

FTB Property Price/FTB Income 4.7 4.7

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£49,064 £52,965

1.5 1.6

MARCH 2010

UK TOTAL Mar-10 Feb-10

Average FTB price £154,720 £154,036

FTB Property Price/FTB Income 4.8 4.8

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple

of FTB income

North East Mar-10 Feb-10

Average FTB price £110,197 £108,744

FTB Property Price/FTB Income 3.4 3.4

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£6,575 £9,305

0.2 0.3

Yorkshire & Humber Mar-10 Feb-10

Average FTB price £115,537 £115,318

FTB Property Price/FTB Income 4.1 4.1

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£24,752 £28,202

0.9 1.0

East Midlands Mar-10 Feb-10

Average FTB price £115,309 £115,253

FTB Property Price/FTB Income 3.7 3.7

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£14,951 £18,947

0.5 0.6

East of England Mar-10 Feb-10

Average FTB price £137,774 £137,997

FTB Property Price/FTB Income 4.1 4.1

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£30,387 £34,945

0.9 1.0

London Mar-10 Feb-10

Average FTB price £251,607 £250,545

FTB Property Price/FTB Income 6.7 6.6

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£130,155 £133,997

3.5 3.6

South East Mar-10 Feb-10

Average FTB price £184,942 £183,722

FTB Property Price/FTB Income 5.1 5.0

Affordability Gap

(Effective Deposit Required)

Affordability Gap as multiple of

FTB income

£51,738 £55,214

1.6 1.7

£67,782 £71,293

1.9 2.0

[ 8 ]


London Boroughs

London Borough House Prices

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

MARCH 2010

Rank Borough AVG Property Price % Monthly Change % Annual Change ALL

Greater London £437,464 0.3% 8.7%

1 Kensington & Chelsea £1,059,350 2.0% 10.0%

2 City of Westminster £973,359 0.2% 15.1%

3 Camden £704,647 1.3% 14.8%

4 Hammersmith & Fulham £661,197 1.8% 14.6%

5 City of London £511,633 -3.4% 11.7%

6 Richmond upon Thames £477,612 1.1% 3.5%

7 Barnet £503,111 1.2% 12.0%

8 Haringey £461,992 2.3% 2.3%

9 Wandsworth £475,255 0.7% 8.4%

10 Islington £429,734 1.2% 2.4%

11 Kingston upon Thames £389,837 0.5% 10.4%

12 Ealing £394,489 0.9% 6.9%

13 Merton £447,725 1.8% 17.1%

14 Lambeth £356,903 1.0% 5.4%

15 Brent £357,766 0.6% 2.3%

16 Tower Hamlets £343,457 1.2% -3.3%

17 Harrow £342,794 -0.1% 11.4%

18 Hackney £356,285 1.9% 15.1%

19 Hounslow £338,415 1.3% 4.6%

20 Bromley £336,547 0.1% 4.9%

21 Southwark £338,364 1.5% 5.3%

22 Hillingdon £306,180 0.4% 6.0%

23 Enfield £308,548 0.9% 5.1%

24 Redbridge £286,737 -0.7% 6.8%

25 Havering £280,173 1.3% 5.3%

26 Lewisham £278,290 0.9% 3.2%

27 Sutton £279,166 0.4% 6.4%

28 Greenwich £264,184 3.3% 1.7%

29 Croydon £255,702 0.6% 2.6%

30 Waltham Forest £235,634 -0.6% 8.3%

31 Bexley £232,989 0.8% 7.2%

32 Newham £234,007 1.9% 11.7%

33 Barking & Dagenham £182,306 0.4% 2.4%

[ 9 ]


Supply Vs. Asking Price

Supply Vs Asking Price

Supply Vs Asking Price All Properties

£240K

£230K

£220K

£210K

£200K

£190K

£180K

£170K

£160K

£150K

J an-08

J an-08

F eb-08

Media Enquiries:

Date UK Average Asking Price

(All)

M ar-08

Apr-08

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

M ay -08

Supply Vs Asking Price First-Time Buyer

F eb-08

M ar-08

Apr-08

M ay -08

J un-08

J un-08

J ul-08

J ul-08

Aug-08

Aug-08

Sep-08

O c t-08

N ov -08

D ec -08

J an-09

F eb-09

M ar-09

Apr-09

M ay -09

J un-09

A v g A s king Pric e UK Property Count Index A LL

Sep-08

O c t-08

N ov -08

UK Average Asking Price

(FTB)

D ec -08

J an-09

F eb-09

M ar-09

Apr-09

M ay -09

J un-09

J ul-09

J ul-09

A v g A s king Pric e FTB Property Count Index FTB

Property Count Index

(supply of all stock)

Aug-09

Aug-09

Sep-09

Sep-09

O c t-09

O c t-09

N ov -09

N ov -09

D ec -09

D ec -09

J an-10

J an-10

MARCH 2010

Property Count Index

(supply of FTB stock)

Jan-2008 £230,714 £175,912 100.0 100.0

Feb-2008 £229,410 £174,685 117.2 115.0

Mar-2008 £229,648 £174,328 136.6 132.6

Apr-2008 £227,438 £172,485 168.6 158.4

May-2008 £222,893 £168,736 185.3 170.9

Jun-2008 £221,683 £167,021 200.8 182.9

Jul-2008 £220,886 £165,166 231.0 205.6

Aug-2008 £218,912 £163,143 236.6 208.7

Sep-2008 £217,622 £161,644 236.1 206.4

Oct-2008 £218,439 £161,160 229.3 197.5

Nov-2008 £220,014 £161,564 226.7 194.6

Dec-2008 £219,397 £160,985 222.4 189.7

Jan-2009 £218,784 £160,174 212.5 181.8

Feb-2009 £215,036 £156,385 242.5 206.6

Mar-2009 £213,478 £154,684 232.8 198.9

Apr-2009 £213,594 £153,643 221.6 187.9

May-2009 £215,761 £153,880 210.9 177.9

Jun-2009 £216,496 £153,460 200.9 168.8

Jul-2009 £217,821 £153,974 189.8 160.4

Aug-2009 £217,737 £153,719 187.2 159.1

Sep-2009 £218,134 £154,205 189.0 161.6

Oct-2009 £219,658 £154,613 189.3 161.0

Nov-2009 £218,654 £154,309 186.6 160.7

Dec-2009 £217,710 £154,133 184.1 159.8

Jan-2010 £216,801 £153,988 181.9 158.9

Feb-2010 £216,821 £154,036 188.4 165.7

Mar-2010 £217,006 £154,720 199.0 175.9

F eb-10

F eb-10

M ar-10

M ar-10

300

250

200

150

100

50

0

300

250

200

150

100

50

0

[ 10 ]


About The Methodology

The FindaProperty.com House Prices and Affordability Index is created using a

statistical methodology developed by Calnea Analytics, the company who produce the

official Land Registry house price index. Calnea also created the methodology behind

the FindaProperty.com Rental Index, the only authoritative source of rental values in

the UK’s housing market.

Media Enquiries:

James Craig | The Wriglesworth Consultancy | Tel: 020 7427 1405 | Email: j.craig@wriglesworth.com

© 2010 FindaProperty.com

MARCH 2010

FindaProperty.com chose Calnea in order to ensure that the data was analysed to

the highest possible standards by a company with an outstanding track record in the analysis of house price information.

Calnea brought to the process a degree of statistical sophistication and methodological rigour which we feel is essential to

the creation of a reliable price index.

All data from the FindaProperty.com database is assessed every month; however not all of this data is used in the

monthly calculations. A number of exclusions are carried out to ensure that the final figures are not distorted. For example

properties tagged as sold, or with invalid postcodes, are not included. Despite this process of exclusion, the index is based

on a very large sample of properties – March 2010’s index is calculated from a total of over 237,000 sale properties.

The index is calculated using mix-adjusted averages. These are used instead of simple averages to avoid common

distortions to the data. For example, if in one month a large number of studio flats were put up for sale, a simple average

of prices would look artificially low compared with the previous month. The mix-adjusted method removes the impact of

monthly changes in the stock of property that is on the market and therefore reduces distortions in the data. The data is

adjusted by location, property type and bedroom numbers.

The FindaProperty.com House Prices and Affordability Index tracks the trends in supply and asking prices at UK,

regional, city and London borough levels. To add further context, this index also includes a set of new measures and market

segmentations, including:






Trends in average property prices split by property type (house, flat, bedroom numbers)

First-time buyer property market – defined by property type. Outside of London, first-time buyer property types include

studio flats, 1/2 bed flats and 2 bed houses. Given the price differentials within London, first-time buyer properties are

defined as studios and 1 bed flats

Home Movers are further up the property ladder and are defined as any property with 3 or more bedrooms. In London

this definition also includes 2 bed houses and flats

Affordability measures – given the changes in house prices and availability of finance, affordability is a key issue.

Comparing up-to-date average household incomes (from BMRB’s TGI survey) and average income multiples (from

Council of Mortgage Lenders) with asking prices, this index also tracks what is actually affordable. For example:

The average FTB

property in UK

The average FTB

income in UK

National Bedroom Prices – the cost of moving up the property ladder by showing the cost of an additional bedroom

Using the Index

The average income

multiple for a FTB

Average shortfall, or

required deposit

Please feel free to use the FindaProperty.com House Prices and Affordability Index in your publications. All that we ask

is that any online publications retain all links from within the document.

Please credit FindaProperty.com as the information source and link to the ‘FindaProperty.com House Prices and Affordability

Index’ (http://www.findaproperty.com/house-prices.html) when publishing online.

[ 11 ]

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