By Kate Allen, Callum Locke and Martin Stabe
House prices in the UK are a perennial topic of interest. But different indices measure house prices in different ways, causing confusion among home-owners, who can’t be sure whether their house price is going up or down.
This has become particularly noticeable in recent years as the indices readings have diverged.
The number of working-age households in the UK has fallen for the first time since data collection began nearly 20 years ago, according to new figures from the Office for National Statistics.
Household growth has been fairly steady over the past two decades, with the overall population continuing to grow, and this is the first time figures* have actually dropped. Pressures such as low real wage growth and rising housing costs have created economic constraints in recent years which could help to explain the dramatic shift.
In particular, the numbers of single-person and lone parent households have fallen, hinting at housing affordability pressures. The number of couples with dependent children (under 18s) rose year-on-year, suggesting that families may be staying together rather than separating. Read more
Money doesn’t grow on trees, right? That’s what UK chancellor George Osborne will be sighing as he prepares for tomorrow’s annual Budget, which is expected to be stringent. But actually, some British policy-watchers think they’ve found a way to magic more money out of thin air.
It comes down to the hoary old question of the public finances. Specifically, Britain’s main measure is public sector net debt, which doesn’t match international measures such as those set out in the Maastricht Treaty: “The Maastricht debt is limited to general government whereas in the public sector finances the principal debt measure is that for the public sector,” explains the ONS.
The key difference relates to a set of organisations called “public sector trading bodies“. These are basically organisations with their own ringfenced cashflows, spending plans and budgets. The Export Credits Guarantee Department is one. So are local authority housing departments.
“Internationally the focus is on general government measures of debt and borrowing – not including the borrowing and expenditure of public sector trading bodies,” says Steve Wilcox, a professor at the University of York who’s been on a crusade to publicise this for several years. Read more
The number of housing benefit claimants is rising, and thus so is the cost to the Treasury, data from the Department for Work and Pensions shows. The number of people claiming housing benefit has increased by a startling 780,000 since the beginning of 2009 to 5 million.
There are a couple of small rays of light for the government.
Firstly, the rate of increase in claimants has slowed since the general election in May 2010.
The Office for National Statistics has expressed concern over the quality and timeliness of some official housing market data.
In the second stage of the ONS’s review of housing market statistics, which has just been published, it calls for greater accessibility of housing-related stats, more availability and greater punctuality of local-level figures, and the introduction of a private rental price index. Read more