FOI Ref: FOI/2022/4071

You asked

With regards to the this link, please supply the following information:

Q1. Have you included any house sales in more than one months calculations for the House price Index in 2019, 2020 and 2021?

Q2.  As a percentage, please state how many house sales were included in your HPI for each month in 2019, 2020 and 2021?

We said

Thank you for your enquiry.

Question 1

We have inferred that the request is referring to the fact that we have temporarily changed the way we process new build properties as part of the data processing for the UK House Price Index.

In particular, throughout the pandemic, due to a reduction in the number of new build property transactions that are processed by our data suppliers, we have pooled new build transactions for certain months in England and Wales. This means that, for the latest UK House Price Index - Office for National Statistics (ons.gov.uk) release (published 13 April 2022):

  • August 2021 includes new build transactions from July and August 2021 - This meant all 1245 new build transactions from July 2021 in England and Wales were used in the calculation of August 2021

  • September 2021 includes new build transactions from August and September 2021 - This meant all 1507 new build transactions from August 2021 in England and Wales were used in the calculation of September 2021

  • October 2021 includes new build transactions from September and October 2021 - This meant all 1497 new build transactions from September 2021 in England and Wales were used in the calculation of October 2021

  • November 2021 includes new build transactions from October and November 2021 - This meant all 674 new build transactions from October 2021 in England and Wales were used in the calculation of November 2021

  • December 2021 includes new build transactions from November and December 2021 - This meant all 621 new build transactions from November 2021 in England and Wales were used in the calculation of December 2021

  • January 2022 includes new build transactions from December 2021 and January 2022 - This meant all 570 new build transactions from December 2021 in England and Wales were used in the calculation of January 2021

February 2022 has not been affected as new builds are never included in the model for the first estimate because of the nature of their processing. It should also be noted that the data collection delay mainly affects the most recent months and as such, the two most recent months of sales volumes are therefore omitted from the published data to avoid reporting misleading volumes. Therefore, the sales volumes for both January and February 2022 are unavailable in the UK HPI full file (landregistry.gov.uk).

Prior to the first month where the 'pooling' methodology has been used (August 2021), all sales volumes published in the UK HPI full file (landregistry.gov.uk) will be the number of sales volumes that have been processed by HMLR at that point in time *and* the number feeding into the new build property house price estimates for the particular reference period (i.e. no additional transactions were included for any months prior to those listed above).

The months for which we include new build transactions from a previous month will change with every monthly release as new data are available from our supplier, and the number of transactions we receive for new build properties increases over time. We specify which months have been included in the pooling process within each month's statistical bulletin (UK House Price Index - Office for National Statistics (ons.gov.uk)) under the 'Measuring the data' section, under the sub-heading 'Coronavirus (Covid-19)' should you wish to investigate which months were pooled in any of our previous releases.

Question 2

We believe the percentages quoted in the request may be from the About the UK House Price Index - GOV.UK (www.gov.uk)  online document, which states:

'...our provisional (first) estimate for a particular month is calculated on around 40% of the transactions that will ultimately get registered with the second and third estimates calculated based on around 80% and 85% of the final registered transactions. Revisions to the UK HPI estimates arise as the index is re-calculated to incorporate these additional transactions.'

These percentages would have been calculated retrospectively, based on transaction numbers at a point in time, to provide users with a general understanding of how the number of transactions for the first estimate will change over time throughout our revisions period, highlighting that as we receive more processed transactions from our supplier, the estimates will be subject to revisions. (It is also worth noting that this estimate would have been based on pre-pandemic figures and, as we have stated previously in all our statistical releases, the number of processed transactions that we were able to receive throughout the pandemic was reduced and as such, estimates are subject to higher revisions than before).

We would not know the final number of processed transactions for a particular reference month until 12 months later (when we have received all revisions for that period) and we do not retrospectively calculate the percentage of transactions for each month at the point of first (or second or third etc) publication as a proportion of the final transaction volume. Therefore, we are unable to provide these percentages as we do not hold the information.

If you wanted to retrieve the percentages based on our archived data on the HMLR website (which you can navigate to via the main reports page: UK House Price Index: reports - GOV.UK (www.gov.uk)), it would be possible to do this for all months outside of the revisions period (where we now have final transaction counts). You would need to obtain the sales volume count for the first estimate (or second estimate, or third estimate, depending on which you were interested in) and then represent this as a percentage of the sales volume count in the latest UK HPI full file (landregistry.gov.uk).

If you would like us to carry out this as a bespoke analysis, we would be able to do so, but it would be at a charge in line with our charging policy. The timing in which we could provide such analysis would also be dependent on other priorities relating to our regular publications and ongoing analytical work.

We hope you find the above information useful, if you have any further questions or would like to discuss your request in more detail, please contact the Housing Market Indices branch directly via our email: HPI@ons.gov.uk.