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UK House prices: News & Views


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Firefighters tackle Basingstoke construction site fire

http://www.bbc.co.uk/news/uk-england-hampshire-11268241

_49063641_basingstokefire.jpg

 

What a loss. Certainly all this flats had been sold "off plan" already months ago.

 

He added that fire spread was a major concern at the incident, and that the Chief Fire Officers Association "was right to be increasingly concerned about the number and severity of fires in timber framed buildings under construction".

Certainly, this has nothing to do with the house price collapse.

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Firefighters tackle Basingstoke construction site fire

http://www.bbc.co.uk/news/uk-england-hampshire-11268241

_49063641_basingstokefire.jpg

 

What a loss. Certainly all this flats had been sold "off plan" already months ago.

 

 

Certainly, this has nothing to do with the house price collapse.

Wrong, sorry!!!

 

This site is a social housing site, not private. Best not to spread rumours eh.

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Wrong, sorry!!!

 

This site is a social housing site, not private. Best not to spread rumours eh.

Not related to HPC, as I said. ;)

 

So, the council built this? Maybe the builders are happy about the extra work that they have now. Nothing to do with HPC of course. :)

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Not related to HPC, as I said. ;)

 

So, the council built this? Maybe the builders are happy about the extra work that they have now. Nothing to do with HPC of course. :)

 

Lol

A few young arsonists from the neighbouringvcouncil estate have been arrested for setting a timber frame block on fire.

That's all. I like you're thinking because I too initially thought that, so researched more. I know a lot of the housebuilders in the area and was intrigued and unfortunately there's nothing suspicious here - just a sad example of twat youths with nowt to do and v sadly preventing much needed council houses being occupied for local people.

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Lol

A few young arsonists from the neighbouringvcouncil estate have been arrested for setting a timber frame block on fire.

That's all. I like you're thinking because I too initially thought that, so researched more. I know a lot of the housebuilders in the area and was intrigued and unfortunately there's nothing suspicious here - just a sad example of twat youths with nowt to do and v sadly preventing much needed council houses being occupied for local people.

Fair enough, and I do think one should hold back with suspicions in individual cases. What I found interesting is that this seems to be some kind of trend (see article). So is this because the youth is more and more bored, or is there another reason?

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On the US housing market, but a good read nevertheless.

 

http://news.goldseek.com/RickAckerman/1284704553.php

Bob Farrell’s Rule #2

 

Unfortunately, Mr. Market is the issue and at the margin, the film is jammed, the screen looks like bubbling molasses. We never did stop to figure out how Grandpa did that, but I suppose he just wound the film on the reel backwards. Ultimately the market has to clear and — wouldn’t you know it? — that just leads us right back to Bob Farrell’s Market Rules to Remember. Rule #2 is operative, particularly when viewing the Case Shiller Housing Price Chart. “Excesses in one direction will lead to an opposite excess in the other direction.” Rule #2 is based on a common sense understanding of supply and demand. Normal human perception dictates that the longer and steeper a market appreciates (or depreciates) the more linear the belief in the trend becomes. Of course, that is not the way the universe actually works. During periods of extreme linear belief, supply explodes (or implodes in the case exponentially rapidly falling markets). Compounding the human perception problem is the fact that, once the market exposes the flaw of linear thinking, belief then retreats to the concept of “fair value.”

 

But Mr. Market won’t be satisfied until supply is cleared. That is why “extremely cheap” has to follow “manically expensive.” “Fair value” is just a rest stop along the way. The rent/buy calculus, even though it is a moving target, is a central equation in trying to determine “fair value” in the housing market. But just as this metric for fair value was completely abandoned in the face of the marvelous process of capital appreciation during the secular bull market, prices will reflect overwhelming concerns about devaluation, maintenance expense and vacancy risk as well as a general deflationary mentality toward rent at the bottom extreme. It ain’t easy being human. That is why it is good to have rules. In addition to correcting prices, correcting excesses in things such as size, configuration and location will have to occur as well.

 

We have spoken in the past about the 1973 Lincoln Continental syndrome. The housing bubble resulted in a dramatic increase in the average square footage of homes, even as the average number of people in the family got smaller. Standard equipment became more opulent at all levels. A perception developed that second homes were broadly affordable so vacation and retirement spots were dramatically overbuilt. For all these reasons, supply across the spectrum is extremely large and growing. Much of it is obsolete. Think McMansion developments in marginal neighborhoods. It is very difficult to envision the housing market making a positive contribution to economic growth over the next several years.

 

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PREDICTED PRICE RISES around the world

 

The following table shows Knight Frank’s predictions for home prices for a selection of markets:

 

Market----- 2010 / 2011

 

Hong Kong... 18. :12.0

Russia......... 8.8 :11.3

Malaysia...... 0.0 :10.0

Sweden....... 4.0 : 6.0

China.......... 6.5 : 5.0

Singapore.... 10. : 3.0

Switzerland. -5.0 : 3.0

U.K. .......... -3.3 : 2.0

U.S. .......... -1.0 : 1.0

Canada........ 3.5 :-0.9

Spain.......... -4.0 :-2.0

Ireland........ -11. :-3.0

 

/source: http://www.bloomberg.com/news/2010-09-13/h...-rate-risk.html

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London's CRASHING !

Mon.: Rt'move : London / Na'wide H.old.SA Hali.SA Hali.nsa: H&Nindex : mom :DelusIdx

2010

J. : : 237,767 : 429,597 / 170,111 166,203 166,351 166,395 : £168,253 :- 0.55% :140.5%

Jl : : 236,332 : 422,248 / 169,347 167,425 167,536 168,331 : £168,839 :+0.35% :140.0%

A. : : 232,241 : 405,058 / 166,507 = n/a = 167,953 168,889 : £167,698 :- 0.68% :138.5%

S. : : 229,767 : 399,019 /

mom: -1.07%: - 1.49% // -1.68% : = n/a = :+0.25% +0.33%

You are right.

Down from £429,597 to £399,019 in three months !

That's - £30,578, or minus 7.1 %, - 2.4% per month.

 

What was crash cruise speed supposed to be ?

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You are right.

Down from £429,597 to £399,019 in three months !

That's - £30,578, or minus 7.1 %, - 2.4% per month.

 

What was crash cruise speed supposed to be ?

Answer:

Crash Cruise speed is an average fall of about -1% per month, or more.

 

Per Rightmove : London's running at over 2%, or DOUBLE the speed limit - that's fast !

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Answer:

Crash Cruise speed is an average fall of about -1% per month, or more.

 

Per Rightmove : London's running at DOUBLE the speed limit - that's fast !

And let's not forget these falls should be seen in the light of very low interest rates. Could this be the last chance to exit the market before falls become rife? Just imagine if rates went up even a little! Last month there was talk of 8 percent rates. That would crucify the market and all the- unto now- 'lucky' ones on tracker rates. Hope they have been putting the 'little extra' away each month.

Like hell.

This is Brown's legacy present to Cameron. A time bomb.

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And let's not forget these falls should be seen in the light of very low interest rates. Could this be the last chance to exit the market before falls become rife? Just imagine if rates went up even a little! Last month there was talk of 8 percent rates. That would crucify the market and all the- unto now- 'lucky' ones on tracker rates. Hope they have been putting the 'little extra' away each month.

Like hell.

This is Brown's legacy present to Cameron. A time bomb.

 

Indeed. The falls in 2007/2008 came on the back of rates going from 3.5% -> 5.5%.

 

Now we have suckers over-leveraged on 0.5% base rate - so any increase in the rates is going to have a HUGE proportional affect on the cost of their mortgages. There WILL be a bloodbath when you have rising rates and public sector workers laid off all over the place.

 

 

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Price falls in a bear market can be astounding.

 

Back in 2002 I bought some loyds shares at about 4.50 per share. I figured they had crashed by 50% from their peak, so they must be near the bottom. And you can't go wrong with a sound, blue chip shares in a bank, right? You need to remember that this was just after ten years of the media reporting that shares only go up, and how, in the long run, shares outperform al other asset classes.

 

So I held these things for a year or two, waiting for the market to rebound. They never did. Eventually I cut my losses and sold them for about 3.50 per share. Their price now? Seventy five pence. That's a fall of about 90% from their peak, not counting inflation. And when house prices begin crashing properly I can see lloy becoming just about worthless

 

I like to think of my experience as being like a modern day greek tragedy, or maybe an Aesop's fable. And you know how at the end of an aesop's fable there is a little one-line pearl of wisdom? Well the wisdom at the end of mine is 'whatever you do, don't buy a house in 2011.'

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I love the way RightMove is seen as a flawed survey on the way UP and gospel on the way DOWN.

 

Rightmove is the "delusion" index. It has it's uses. Now we have Rightmove index sinking fast and the RICS survey turning negative in the last few months. These are generally regarded as the leading indexes, while the lagging Halifax/Nationwide are levelling off quickly and will soon be flat YoY. The ship is definitely turning now.

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Indeed. The falls in 2007/2008 came on the back of rates going from 3.5% -> 5.5%.

Now we have suckers over-leveraged on 0.5% base rate - so any increase in the rates is going to have a HUGE proportional affect on the cost of their mortgages. There WILL be a bloodbath when you have rising rates and public sector workers laid off all over the place.

 

Sadly, the reckless Jerkimers will not be the only ones to suffer.

When their equity disappears, they will wind up underwater, and soon after - they will be in a position to default on their loans. Chances are, the banks will wind up with hundreds of billions, even trillions of new losses. And they will ask for another bailout, costing another big sum for tax payers.

 

So the reckless homebuyers, who over-paid and borrowed too much, will wind up costing innocent prudent citizens plenty.

 

The homeowners will suffer, but the bankers, builders, and brokers, who were all paid too much for doing bad business, will probably get off scot-free.

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...

So I held these things for a year or two, waiting for the market to rebound. They never did. Eventually I cut my losses and sold them for about 3.50 per share. Their price now? Seventy five pence. That's a fall of about 90% from their peak, not counting inflation. And when house prices begin crashing properly I can see lloy becoming just about worthless

...

Did you get any dividends payments in the 1/2 year(s) you held?

 

http://www.greenenergyinvestors.com/index.php?showtopic=6192

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UK mortgage lending slides to 10-year low

UK mortgage lending fell to a 10-year low of £11.4bn in August, further reinforcing fears that the recovery in the housing market is fading.

http://www.telegraph.co.uk/finance/economi...0-year-low.html

 

Earlier on Monday, property website Rightmove said property asking prices fell for the third month in a row during September as estate agents continued to have record levels of unsold stock on their books.

The average cost of a home put up for sale in England and Wales during the five weeks to September 11 dipped by 1.1pc to £229,767, Rightmove said.

New sellers have now dropped their asking prices by 3.4pc, or more than £8,000, during the past three months, wiping out half of the gains made during the first half of the year.

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Rightmove is the "delusion" index. It has it's uses. Now we have Rightmove index sinking fast and the RICS survey turning negative in the last few months. These are generally regarded as the leading indexes, while the lagging Halifax/Nationwide are levelling off quickly and will soon be flat YoY. The ship is definitely turning now.

 

RightMove is the ‘delusion’ index that ignores all the properties which have been on the market for more than 30 days.

 

If you were designing an index of asking prices, would you ignore most of the asking prices?

 

I accept it is an indicator of sentiment but nothing more than that. The Daily Mail is a better indicator of sentiment.

 

In my experience of buying a house last year, a lot of properties did not have a HIP. Now that the HIP law has been pulled, most of these properties are being re-listed as ‘new’. Considering all the price cuts over the past year, this will pull the RightMove index down without any change to the asking prices of ALL the properties on RightMove.

 

I accept your point about the RICS survey. This one is actually a reasonable piece of evidence.

 

BTW, Have you seen my RightMove survey? http://www.greenenergyinvestors.com/index....st&p=183870

 

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I love the way RightMove is seen as a flawed survey on the way UP and gospel on the way DOWN.

Some thought it was flawed by being "too optimistic".

(And also to much tied to Greater London to match the more-regionally oriented indices, like Nationwide and Halifax

 

Just as an exercise, I compared RM's index (blue) with: 50%-Nationwide, 25%-Halifax & 25%-RM-Greater London

 

001zjn.jpg

 

The composite was a rather good fix suggesting that RM simply has a heavier weighting towards London

 

Here's another comparison, which includes the H&N-Index (here, x 132% to make it comparable with Rightmove)

001qc.jpg

 

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UK mortgage lending slides to 10-year low

UK mortgage lending fell to a 10-year low of £11.4bn in August, further reinforcing fears that the recovery in the housing market is fading.

http://www.telegraph.co.uk/finance/economi...0-year-low.html

 

I believe* the CML data includes re-mortgaging and therefore it should come as no surprise that people don’t want to re-mortgage on less favourable terms.

 

The headline should read “People not dumb enough to pay more for the same thing”.

 

* I can’t check to be 100% certain atm.

 

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Did you get any dividends payments in the 1/2 year(s) you held?

 

http://www.greenenergyinvestors.com/index.php?showtopic=6192

 

They had a dividend reinvestment scheme that I signed on to. Good divis if I remember correctly. But the capital loss wiped out those gains.

 

Only lost a few thousand, so it wasn't the end of the world. It does show how much prices can fall by, though. If you'd have told someone in '99 that lloy would fall to less than a pound per share they'd have laughed at you. I guess you'd get a similar reaction if you told someone you think house prices could fall by 80% in the next couple of years. Maybe house prices wont fall by so much. But they could.

 

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