UK Housing Observatory
A project developed by the Economics Department at Lancaster University Management School aimed at improving understanding of the UK national and regional house price dynamics. The UK Housing Observatory is now interactive and has moved to a new domain: https://uk.housing-observatory.com
The UK Housing Observatory is a project of the Economics Department at Lancaster University Management School (LUMS) aiming to improve our understanding of the UK national and regional housing markets.
We provide a comprehensive publicly available set of information and tools to perform real-time monitoring of domestic real estate markets both at the national and regional level. We generate a novel House Price Uncertainty Index; original Indicators of House Price Exuberance, and produce Forecasts of house price growth for 1,2,3 and 4 quarters ahead for the UK national and regional markets, updated quarterly. Please note our disclaimer in regards to the usage of our data.
Our research is not confined to the UK real estate market alone. We work in cooperation with the International House Price Database of the Globalization and Monetary Policy Institute on providing similar exuberance indicators for international markets, which are available at The Federal Reserve Bank of Dallas website.
In the media
How a no-deal Brexit will affect house prices
Ivan Paya, Director of the UK Housing Observatory, was interviewed for i news about how he expects a no-deal Brexit to affect the UK housing market through “several channels”. "Over the last two quarters, we have observed that the house price uncertainty (HPU) index computed by the UK Housing Observatory has increased by more than 80 per cent, signalling a risk to the housing market and overall performance of the country’s economy.”
Latest Release: 2019 Q2
Overview: The annual growth rate currently stands at 0.7%. Property prices in Greater London have fallen by nearly 4.5% since the historical maximum of 2017 Q1.
To find out more view our Summary of the latest release.
- National Market
- Regional Markets
Although the Contents contained herein are provided under the highest professional standards in the generation of these forecasts, the UK Housing Observatory does not guarantee the accuracy or completeness of any information contained herein. The UK Housing Observatory specifically disclaims all warranties, expressed or implied, with respect to the use of this information or any results with respect thereto. In addition, the information contained herein shall in no way be construed to constitute a recommendation by the UK Housing Observatory with respect to the purchase or sale of any investment, security or its derivatives.
Discover our key resources including our data archive, publications and econometrics code.
Data Releases Archive
Date Key Documents Q2 2019 Summary Exuberance Indicators Q1 2019 Q4 2018 Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 Exuberance Indicators Q2 2017 Q1 2017 Q4 2016 Summary Exuberance Indicators Forecasting
Users of this data must cite: Alisa Yusupova, Efthymios G. Pavlidis, Ivan Paya and David A. Peel (2015), UK Housing Observatory, Dept. of Economics, Lancaster University Management School.
R and Eviews codes implementing the econometric tests of Phillips et al. (2013) "Testing for Multiple Bubbles 1: Historical Episodes of Exuberance and Collapse in the S&P 500".
R code.zip which replicates GSADF test in Phillips et al. (2013), "Testing for Multiple Bubbles: Historical Episodes of Exuberance and Collapse in the S&P 500".
Eviews code.zip which replicates GSADF test in Phillips et al. (2013), "Testing for Multiple Bubbles: Historical Episodes of Exuberance and Collapse in the S&P 500".
Eviews CODE.zip for getting the sequesnce of 95% critical values from the Empirical Application of Phillips et al. (2013) , "Testing for Multiple Bubbles: Historical Episodes of Exuberance and Collapse in the S&P 500".
National level data is from Federal Reserve Bank of Dallas' International House Price Database. Each release of the database includes the following time-series: the house price index (HPI), the house price index adjusted for inflation (RHPI), the index of personal disposable income (PDI) and the index of personal disposable income adjusted for inflation (RPDI). The data is reported quarterly and goes back to the first quarter of 1975. We construct a measure of housing affordability as the ratio of RHPI to RPDI. Visit the Federal Reserve Bank of Dallas webpage for detailed description of the data construction methodology.
Regional House Price indices for 13 regions of the UK are published quarterly by the Nationwide. The dataset dates back to the fourth quarter of 1973, but we start our analysis from the first quarter of 1975. To transform the data into real values each regional series is deflated with consumer price index (CPI).
Regional Income data is obtained from the Family Expenditure Survey (FES)*. For each year, starting from 1975, the dataset is split by region** and the data on average total household's weekly expenditure is extracted. The annual data is then interpolated to obtain quarterly series.
*The FES runs from 1961 to 2001. From 2001 it was replaced by a new survey, the Expenditure and Food Survey (EFS), which became the Living Costs and Food Survey (LCF) from 2008.
**Due to the differences in regional classifications, Outer Metropolitan and Outer South East are assumed to correspond to the South East region in the regional classification adopted by the FES.
Selected list of news items featuring the UK Housing Observatory team:
iNews, 14 February 2019 - How a no-deal Brexit will affect house prices, according to experts
The Independent, 6 April 2018 - Finally got that last home? Don't expect the same wealth as your parents
The Times, 11 April 2017 - The problem is not housing supply –it’s our boom-and-bust mentality
Financial Times, 11 April 2017 - Rising house prices lift birth rates for homeowners, study shows
Business Insider, 11 April 2017 - The key driver of Britain's wildly inflated property market might not be what we think it is
Royal Economic Society, Media Briefing, April 2017 - Exuberance caused the UK house price boom
MSN, 10 April 2017 - The Only Solution to Britain's Housing Crisis May Be a Crash
Finance Monthly, 14 March 2017 - Your thoughts: House Price Growth Slowing Down
Property Reporter (Web), 8 February 2017 - Economists predict housing crash won't happen in 2017
Property Wire, 8 February 2017 - House prices set to grow by 3.5% in the UK in 2017
Property Wire, 18 April 2016 - The growth of London house prices has slowed down, new data suggests
World Finance, 18 January 2016 - Will there be another property bubble in 2016?
Financial Times, November 6, 2015 - London property bubble risks are overblown, say agents
Mirror, November 3, 2015 - London house prices set to crash in 2017 with market ‘currently nearing a bubble’
This is Money, November 3, 2015 - Britain's property market isn't in a bubble, academics claim - but London is on the cusp of one...and it could blow up in 2017
Evening Standard, November 2, 2015 - Is London heading for another property price bubble as soon as 2017?
The Conversation, June 11, 2014 - Explosive London Housing bubble will spread to the rest of the UK
Links to related publications
- Pavlidis E.G., Paya I., Peel D.A., 2017. "Testing for Speculative Bubbles Using Spot and Forward Prices", International Economic Review, 58(4), pp.1191-1226.
- Baker S.R., Bloom N., Davis S.J., 2016. "Measuring Economic Policy Uncertainty", The Quarterly Journal of Economics, 131(4), pp.1593-1636.
- Shiller R.J., Wojakowski R.M., Shahid Ebrahim M. and Shackleton M.B., 2017. "Continuous Workout Mortgages: Efficient Pricing and Systemic Implications", Journal of Economic Behavior and Organisation (accepted).
- Yusupova A., Pavlidis E.G., Paya I., Peel D.A., 2017. "Exuberance in the UK Housing Markets", Lancaster University Management School, Working Paper, Paper No. 2017/012.
- Pavlidis E.G., Yusupova A. , Paya I., Peel D.A. , Martinez-Garcia E., Mack A. , Grossman V. , 2016. "Episodes of Exuberance in Housing Markets: In Search of the Smoking Gun" , Journal of Real Estate Finance and Economics, vol.53(4), pp.419-449.
- Phillips P.C.B., Shi, S., and Yu, J., 2013. "Testing for Multiple Bubbles 1: Historical Episodes of Exuberance and Collapse in the S&P 500", Research Collection School Of Economics, Working Paper, Paper No. 04 – 2013
- Phillips, P.C.B., Shi, S., and Yu, J., 2013, "Specification Sensitivity in Right-Tailed Unit Root Testing for Explosive Behavior", Oxford Bulletin of Economics and Statistics, 76, 3 (2014) 0305–9049.
- Phillips, P.C.B., Shi, S., and Yu, J., 2013. "Testing for Multiple Bubbles 2: Limit Theory of Dating Algorithms", Research Collection School Of Economics, Working Paper, Paper No. 05 – 2013
- Phillips, P.C.B., Wu, Y., and Yu, J., 2011. "Explosive behavior in the 1990s Nasdaq: When did exuberance escalate asset values?", International Economic Review, 52, 201-226
- Phillips, P.C.B., and Yu, J., 2011. "Dating the Timeline of Financial Bubbles During the Subprime Crisis", Quantitative Economics, 2, 455-491.