Paddles

It's uncanny the way it's tracking the classic bubble to burst lifecycle, eh? We're very lucky to be living through this time, I only hope we have an equivalent of Galbraith to document it properly in years to come.

The reslience of the almost genetic desire to own property in the UK never ceases to amaze me. I spent last weekend sailing; crossed the channel and back. One of the crew was a self-employed builder who is currently really struggling to find jobs and when he does, his margins are being eroded by cheaper Eastern European outfits. We noticed that the shipping lanes didn't seem very busy at all this trip, comparitively very few of the -really- big container ships crossing our path, which tallies up with what we've been seeing on the Baltic Dry Index. I mentioned that I felt that this indicated that the "green shoots" were probably not going to thrive too well. The bloke then proceeded to tell me that the best thing to do would be to invest in property because the "yields" are good now because of low interest rates. "but what about the capital?", I asked, "last year saw the market drop 20%, it could easily drop another 10%, especially as interest rates have only got one way to go now". His reply; "but you'll still make your 5% yield". AAAARRRRGGGGHHHHHH!

Well, the economists' favourite joker, Anatole Kaletsky begs to differ, again. Today's article is a classic top drawer effort from him, full of contradictions ("the UK is back on the historical trend line BUT the trend line means little because the market varies so wildly BUT we're back within 3% of the the trend line so it's time to buy"), statistics quoted without source, a comparison with the previous crash with regards to depth of drop but not duration, etc. etc. He does however, have the humility to point out that his article of 13 months ago demonstrated the quality that we've come to associate most strongly with Moscow's finest commentator on capitalism; getting it almost perfectly wrong. One day I will discover the real reason he is still employed, until then I will satisfy myself with inventing ever more elaborate and amusing conspiracy theories. http://www.timesonline.co.uk/tol/comment/c...icle6329346.ece Anatole Kaletsky

I can see us bouncing along at this level of approvals for many many months; lenders don't want to lend and borrowers are losing their jobs. There's no rule that says the graph has to rise or fall significantly immediately.

Has he worked in the mortgage industry for 20 years in Edinburgh or was he in London during the last crash? The reason I ask is because the last crash felt very much London and the South East focused with the rest of the UK being impacted to a much lesser degree. Am I correct in this recollection? Capitulation is when sellers slash prices to just get out of the market and leave it behind like a bad memory. The main contenders for capitulation will be 2nd properties and these are typically 2 bedroom flats. When the average price of these gets back to somewhere close to the long term trend line (e.g. 1997/8 prices rolled forward with some inflation each year) we'll have hit capitulation. Until then, it's still to come.

The Evening Standard is a truly hateful rag. I remember occasionally reading a discarded copy (I'd never pay for it) during the years of the last crash and seeing all the pages upon pages of adverts featuring an artist's impression of the utopia that would be the latest nasty development to be sold to suckers out in Zone 27b ("Only 55 minutes from St. Pancras!" - well so is bloody Charles De Gaul Airport). All pictures of happy couples eating at al fresco cafes and mothers pushing buggies and the sun is always shining. In the meantime, prices slid for nigh on 6 years, interest rates were eye-watering and many people in previously "essential" jobs were laid off. In the block of 8 flats where I lived, 2 were repossessed and one handed the keys back and skipped out the country because he'd become sick with worry about owing £20k more than the current value of the place. [edit: and to put it in context, those repos happened in 1993 and 1994, so at least 2 years after the prices started to fall, i.e. winter 2009 in the current crash] And all through that time the Standard were posting headlines like today's; "House prices rise at last". The worst thing is, if I hadn't seen it last time, I might have been a sucker this time. Who knows?

I work quickly. The information was offered, I felt like I was a priest at a confessional. I guessed the bit about her being a K. D. Lang fan. It might not be true.

Bit of an anecgloatal and relating to Bulgaria's HPC but I'm in Bansko skiing this week; Interesting place, Bansko; they developed it as a ski resort about 5 years ago and the town has been hit by that modern of plagues - property speculation you can't move for empty and half-finished apartment blocks that look like they were thrown up by people (in the words of P. J. O'Rourke) who forgot the recipe for concrete, "Ivan, is it 2 parts cement, 1 part milk, da?". I shared a chair lift yesterday with an Irish woman who bought a place last year some 3 miles away. After a bit of a chat, it became apparent that this was her first time in the place. Good grief! I mean, you wouldn't buy a car without seeing it, what on earth would possess someone to buy a property sight unseen? Needless to say, it's been smashed in value and the promised rental income has vapourised too. The only small mercy is that her sexual preferences reduce the risk of her contributing to the global gene pool.

Correct. There was a bit of a kerfuffle in the press about it last month, but it shouldn't come as a surprise to anyone as the exclusions are stated on the website. I hesitated and nearly wrote "clearly stated" but that would have been inaccurate; the language used is obtuse to say the least.

http://www.landreg.gov.uk/assets/library/d...ents/221282.pdf Land Registry speeding up nicely and they don't count reposessions or any sale that looks a bit cheap*. * made that last bit up, but the list of exclusions is longer than Anatole Kaletsky's reasons why no-one could see this coming....

It's not exactly for that reason that I've posted my last time on there and signed up here yesterday, but it's shallow enough to suffice for now. Going on from Goldfinger's point; I emailed Fionaulla a few months ago and suggested that she either knew at the time that the prediction she gave previously was incorrect (using the simple straight ruler method of forecasting) and was therefore a knave OR she wasn't very good at her job. No reply of course, but I felt better for it nonetheless. First post. Treat me gently chaps. Is there an initiation ceremony I have to go through or what? I have a note from Mummy Paddles about allergies and a weak chest, if so...