As I speculated late last month there was a potentially nasty blow in the pipeline for the sales teams of house builders and at estate agents when the Halifax house price index was published.

Well the figures have been published and show a monthly fall of 2.5%, the fastest since September 1992. This was worse than expected and puts the March 2008 seasonally adjusted average house price at £191,556 against £194,094 last March. A fall of 1.3%.

Now, if the figure of a 1.3% drop in house prices annually doesn’t seem to tally with the figure you see presented of an annual rise of 1.1%, that is because in the small print – and quite sensibly – Halifax says that the annual rate of inflation is smoothed on a quarterly basis to take out the month-to-month bumps.

The downside is that this process makes the headline figure less sensitive to real changes. But as in all statistics the measure you chose is a matter of horses for courses.

But scrape away some of the rust and get down to the metal and you find the numbers presented could have been worse had key revisions not been made to two key previous published figures.

If you look back at the historic figures published last month you see the seasonally adjusted average house price for March 2007 at £194,565 and February 2008 at £196,649. The latest set of figures shows they have been revised down to £194,094 and £196,465 respectively.

Statistician regularly revise figures – particularly seasonally adjusted figures – in the light of new information received, although no other figures appear to have been revised other than these two.

The point is that had the Halifax statistician decided not to adjust these two figures the change in the index would have looked just that bit worse, with the monthly drop at 2.6%.

As I pointed out in the post on March 28, the April figures – even if they show a slight month-on-month rise – are likely to show the biggest turning point yet and we are likely to see Halifax’s headline figure for annual house price inflation dip below zero.

In August last year Halifax’s unadjusted monthly figure for an average UK house was £201,081. That figure now stands at £190,619 a fall of 5.2%. Now that is sobering.