Lies Damned Lies and Statistics
There’s a maxim about the press that says don’t let the truth get in the way of a good story – in other words perhaps we should take everything we read with a pinch of salt. This might be especially so with statistics, because those who prepare them can make ’em look how they want them to where thereafter they can be used to prove some sort of point or, say, to support government policy. And there is no better example, in my view, of statistical benders than our very own politicians, whether they be on the right or the left side of the political muck heap.
The question is what happens when two government departments, monitoring the same thing, come up with two different sets of numbers? Let’s take house prices as an example.
A recent Government report shows that its own statisticians are completely at odds over where the housing market is going and are working on woefully different numbers. The Communities and Local Government data showed that in March, UK house prices went up by 1.2% over the month and 0.9% over the year and that the average house price was, as near as makes no odds, £205,000. And yet HM Land Registry recently reported that house prices fell by 1.1% in March and by 2.3% over the year. The two reports are totally at odds. What’s more, the Land Registry, just two weeks ago, put the average house price at £160,000 rounded down to the nearest thousand.
To be fair, The Land Registry reports only for England and Wales, rather than for the whole of the UK but according to the Communities and Local Government report (the one at odds with the Land Registry’s) this should have actually boosted the Land Registry’s findings. According to the said report, average house prices increased during the year from March 2010 to March 2011, in England by 1.3% but decreased in Scotland , Wales and Northern Ireland. Not surprisingly there is some discomfort with the differing numbers.
The problem is apparently not new. An investigation, starting with the Government’s own two surveys, was proposed and some result was expected before the end of last year, but nothing has been heard. In the meantime, the two government departments have continued to pump out differing results.
By way of comparison, Halifax and Nationwide have sung from the same hymn sheet for some months reporting average house prices at around the £165,000 mark.
So there you have it – there are lies damned lies and statistics.
Thankfully, the good news is that farmland keeps going up in value and lenders seem to be keen to grant mortgages for land.