Devolution for London?

I'm getting increasingly concerned that the house price indices aren't showing us any useful information.

The last four or five issues from several of the index-makers contain the statement that the average national house price has been driven upwards by a strong performance in the London market - particularly at the top end of that market.

I suspect that you would get very different trends if you took one of two alternative approaches.

First of all, you could simply leave London out of the indices and look at 'UK ex London'. Of course you'd need to define 'London' - inside the M25? a given number of boroughs? But that might deliver news of more interest to people living elsewhere in the country.

(In fact, the ODPM index, because it is expenditure-weighted, actually gives more rather than less importance to the south-east and London figures. So it's the reverse of what I'd call useful for the nation as a whole. RightMove is also expenditure-weighted.)

Or secondly, you could leave out houses above a certain amount as atypical. Now that is a bit of a judgmental fix-up of course - but it would give a more useful answer on bog standard properties.

But actually the third approach you could take wouldn't involve any omissions. You could simply use a median rather than a mean price as your average. As far as I'm aware, none of the current indices are doing this (though the Halifax and Nationwide assess the price of a 'typical house' - which probably does help, though apparently the Halifax hasn't updated its idea of a typical house since 1983...)

But perhaps we do need to devolve London as far as house prices are concerned.

By the way, there's some good stuff on Home.co.uk for stats nerds on the indices and how they are constructed.