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Price used by House Price Surveys?

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  • 11-07-2006 12:18pm
    #1
    sapper
    Registered Users Posts: 423 ✭✭


    Just looking at all these articles quoting house prices going up by 10%, 20% since the start of the year..Does anyone know if they're quoting the actual sale agreed price or just the asking price quoted by the estate agent?

    If it's just the asking price used for all these surveys, doesn't that mean there is a pretty big lag effect implicit in the results?

    I mean, say you have a house quoted at 500K six months ago and it sells for 600K in the end (this was "par for the course" in the Dublin market in the spring when I was looking for a house). Then six months later the house is put back up on the market by the vendors at 550K, hoping the bidding jacks it up to 635K or something, but in fact the bids dry up at 570K, losing the vendor 30K.

    Would the permanentTSB house price survey reflect the 10% increase in the asking price (550K vs 500K) or the 5% drop in the actual sale price (600K vs 570K)?

    I suspect they use the offer price. If houses in Dublin under private treaty started selling close to or at their offer price/AMV that would be a huge sea change for the market (houses are selling at least 10% over asking price 2 months ago) , but one that wouldn't necessarily be reflected in these house price surveys until the horse has well and truly bolted.

    If I'm right, there's a lot of slack there for estate agents to "honestly" continue writing articles in the Indo property supplement reporting a booming market when in fact it's slowing down....


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