“Indices should guide, not govern, pricing, client expectations and lending strategy”
When Nationwide’s latest House Price Index suggested that UK house price growth had lost momentum towards the end of 2025, many borrowers and would-be buyers could have been forgiven for immediately assuming the market had turned. Higher borrowing costs and tax changes appeared to have weighed on market activity – at least on Nationwide’s reading of the data.
Halifax is due to publish its own index later this week, and its numbers could either reinforce Nationwide’s findings or point to a firmer market. For brokers, contradictions among house price indices are nothing new and underline why mortgage professionals must look beyond the headlines when advising clients.
Industry experts speaking to Mortgage Introducer stressed that indices are useful reference points but are often poorly understood by borrowers and can mislead on both value and timing. They warned that differing methodologies, coverage and time lags mean no single index can give a complete picture of the housing market.
Different indices, different stories
Mark Harris (pictured top left), chief executive of mortgage broker SPF Private Clients, pointed to the sheer variety of measures in use. “Perhaps one of the reasons why we have so many housing market indices is because they all highlight different features,” he said.
“While the Land Registry data is the most accurate, because it records property sales, there is a significant time lag. Halifax and Nationwide are more timely, cover mortgage approvals and decent volumes of business.”
Harris also highlighted the limits of more visible indicators such as the Rightmove data. “The Rightmove survey gets a lot of coverage but the asking, rather than selling, price element is limited,” he pointed out. “It might not paint an accurate picture of the actual market price achievable. And with any survey, the national average figure usually conceals significant regional differences, as well as variance by property type.”
Read more: Who can you trust? Making sense of Britain’s conflicting house price data
North London estate agent and former RICS residential chairman Jeremy Leaf (pictured top right) made a similar point about the way indices are constructed and interpreted. “There is an almost insatiable appetite for housing market news but it’s often contradictory,” he said.
“Whether a property is bought for cash or is a new build, different stages of the transaction, timing, property mix, seasonally-adjusted figures, trade or public interest bodies – the data collected can vary significantly and have an impact on the findings.”
Leaf noted that main lender indices are influential but incomplete. “We find price indices can significantly compromise decision-making, especially for first-time buyers,” he said. “The Halifax survey is always useful as it has the greatest coverage in the market but looks at when the mortgage is approved, not completed, and there is a quarterly comparison.
“Meanwhile, the Nationwide Building Society’s average value is also based on mortgage approvals, not completions, and is regional and monthly, with similar price patterns. Both of these produce data after terms are agreed but obviously exclude approximately the 40% of cash buyers and arguably there is also a north/south customer bias.”
Rightmove, he added, has broad reach but a narrow focus. “Rightmove (England & Wales) – has 90% coverage in England and Wales but is asking, not selling prices,” Leaf noted.
Other measures fill some gaps but come with their own constraints. “The RICS survey is a reliable identifier of market trends or turning points but excludes price data and is a relatively small sample,” Leaf said. “The ONS survey is the most comprehensive of all as it includes cash sales but it is dated. We find the mortgage approvals survey from the Bank of England to be a good indicator of buyer intention for the next three months at least, which can usefully forecast activity.”
Leaf also pointed to transactions data as a more grounded measure. “Transactions data from HMRC is a more accurate barometer of market health than more volatile property prices as this reflects cash and mortgaged buyer activity but perhaps three to four months earlier,” he said.
Remortgaging, AVMs and valuation disputes
For mortgage professionals, the practical importance of indices often emerges at remortgage. Harris said price data can feed into lender assumptions about value, particularly where an automated valuation is used. “House price indices play a part when a borrower is coming up to remortgage,” Harris said. “It gives an indication as to how lenders will view the property value, particularly in using an AVM.
“However, it will not reflect any potential uplift in value should any property enhancements have been made, such as extensions or loft conversions. Should a desktop or physical valuation be instructed or required, then the valuer’s comments will hold sway.”
He warned that disputes over value are often fuelled by emotion as much as evidence. “When it comes to the value of a property, it can get very emotional, with most of us probably guilty at some point of thinking that our home is worth more than it actually is,” Harris said. “Should expectations not be met, then the homeowner may translate this as a down-valuation.
“There are RICS guidelines to follow (the Red Book) to provide consistency, objectivity and transparency. However, there is an element of subjectivity too. Where there is a difference, lenders should (and many do) have an appeals process although the criteria might make it unworkable. For example, Barclays allows the borrower to appeal where there is a 10% variance between purchase price and valuation (25% for remortgages).”
In some cases, Harris said, leaning into a lender’s automated approach can be appropriate if the loan-to-value (LTV) is not sensitive to small shifts in price. “Sometimes using a product or lender where an AVM would be relied upon might be the right approach for a borrower looking for speed or maybe the loan-to-value is low and proximity to an LTV boundary is not an issue (higher LTV typically means higher product rate),” he said.
Behaviour, confidence and the ‘wealth effect’
Both Harris and Leaf stressed that indices do not just inform valuations; they shape behaviour and sentiment. Harris pointed to the way rising or falling prices can influence spending and borrowing plans. “Signals from the various indices may impact behaviour,” he said.
“House prices going up would have a positive impact on the homeowner’s perceived wealth and could impact spending plans and confidence. It could also shape any additional borrowing plans. Prospective sellers may be more likely to list their property in a rising market. However, the opposite applies and for those looking to buy, a falling market may lead to a wait-and-see or postponement of activity.”
Leaf argued that homebuying decisions are rarely made on numbers alone, even when borrowers are following indices closely. “In our experience, homebuying is emotional decision-making based on confidence to take on debt, rather than mathematical at a particular time,” he said. “For example, pound per square foot versus aspect, light, condition, school catchment, garden, layout, specification – and close family/friends are all factors.”
He cautioned that an over-reliance on published surveys can be unhelpful, particularly for those trying to time the market. “Market surveys should be regarded as guides to prices/direction of travel, rather than followed too closely – trust your instincts, not necessarily the figures,” Leaf said.
Implications for brokers and their clients
For advisers, the message from these indsutry experts is that market indices should be treated as context, not as a proxy for local knowledge or formal valuation. The differences between Halifax, Nationwide, ONS, Rightmove, RICS and other datasets underscore the need to explain methodology to clients: who is included, what is measured, and when.
Brokers working on remortgages must reconcile automated models and lender policies with recent improvements to properties and borrowers’ expectations. Those advising first-time buyers need to address the risk that volatile or conflicting indices may deter clients from acting, even when their circumstances and affordability support a purchase.
Against a backdrop of shifting rates and policy changes, clear communication about what the various indices can, and cannot, show will remain central to good mortgage advice.
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