The Government is to launch an investigation into the usefulness of its own house price indices – the Land Registry and CLG surveys…
The Office of National Statistics will also look at other house price surveys and report by the end of the year.
The probe comes after a rash of absurdly differing reports and a disturbing gulf between asking prices and even the most generously reported selling prices.
For example, in July the Halifax, Nationwide and Land Registry all put house prices at between £166,000 and £170,000, whereas LSL Acadametrics gave the average house price at £218,119 and the CLG's own survey put it at £209,505.
None of the house price surveys came near the asking prices on Rightmove, which quoted an average of £236,332 for the same month.
While CLG's own survey claims to be the most accurate, its prices are at odds with the Land Registry records, which also lay claim to being the most accurate.
CLG only introduced its own survey after expressing concern about the accuracy of other surveys.
The media also regularly report the RICS survey as being a factual poll, when in fact it merely expresses the opinions of some 250 or so surveyors.
Robert Bartlett, chief executive of Chesterton Humberts said: "The plethora of indices and the variety of what they measure is very confusing.
"For example, the CLG index tends to lag all of the other indices, which limits its value. The Land Registry index is useful because it gives a detailed breakdown of property prices by local authority and is generally considered to be the most comprehensive index. However it takes place only when the sale is complete, which means the data lags the RICS, Halifax, Nationwide and Rightmove indices.
"Moreover, figures are subject to revision due to the increased number of transactions that are processed when the first estimate of the index is published."
Stuart Law,chief executive of Assetz, a property investment firm, said: "The differing figures produced by the various monthly house price indices frequently offer a confused picture of the state of play in the UK property market.
"This is especially true at times of major price correction, when contradictory patterns of positive and negative growth emerge between the indices, as seen several times during the recent recession.
"In addition to the capacity for contradiction across the indices, I have always maintained that individual monthly indices from specific providers should not be viewed as reliable market indicators in themselves.
"Property is an illiquid asset and minor monthly fluctuations recorded by a specific organisation cannot be generalised to the sentiment of all home buyers."