Sir, – Now that we seem to be getting all excited about rising residential property prices again, it would be appropriate to consider the way the published average price for houses is arrived at. This is particularly the case since the recent advent of the Residential Property Price Register, where real selling prices, as opposed to mortgage application figures, are recorded.
Up to now we have used the method for arriving at the average that ensures, for example, that the sale of just one mansion in Dublin 4 will skew the figure for the capital, and indeed for the country as a whole. The same can happen in reverse, where 20 houses going for social and affordable purposes in rural Ireland will result in seriously understating the reality for typical buyers.
All this happens because we use the arithmetic mean to define the average, instead of the median price. A change would eliminate, at a stroke, the potential for distortion by outlying sale transactions. This is the method in use in the US. Many commentators claim the arithmetic mean would be disaster in Manhattan because of the disparity between the upper and lower end. Dublin at least, in its own way, suffers from the same problem. – Yours, etc,
SEAMUS McKENNA,
Farrenboley Park,
Windy Arbour, Dublin 14.