The median is the middle value of a set of numbers; half the numbers will fall below the median and half above. Medians at e.g. county/London borough and post code levels, and for Scotland, are also available.
Why Medians? Because median prices complement the arithmetic average price for the same region provided by the LSL Acadata E&W HPI. Furthermore, as a “middle” price, a median price provides an alternative to the “conceptual” price of an average house provided by the Halifax and Nationwide indices and, we suggest, by the UK HPI from the Office for National Statistics (ONS).
The geometric mean prices provided by the UK HPI comprise an average which dampens the effect of changes in the prices at the upper and lower price bounds for the region compared with the arithmetic mean. This is why, in the Acadata “UK House Price Index” Briefing Note, we suggest that this may be best thought of as another conceptual price, aimed at the “price of an average house”. Whilst the lender indices are long established- and of enduring interest- and the UK HPI is likely to become a National Statistic, we believe that readers using house price indices in decision-making should have prices which are fully understandable as an alternative to those based upon concepts which are imprecise, and using means of calculation which are far from simple.
In addition to regional median prices, the Acadata GB workbook shows upper- and lower-quartiles indicative of opposite ends of the market. We will also show median income-to-median price (Affordability) ratios from time-to-time, as may be appropriate. These will contrast with affordability measures using median incomes-to-average house prices which compare two different arithmetic measures.
For readers interested in median prices at lower geographies, we offer these monthly at postcode district level within our Acadata Prices and Transactions (APAT) and Acadata Library service.