UK House prices: News & Views

[Steve Netwriter]

UK HOUSE PRICES TO FALL 50% BY 2011? [22-9-08]

http://uk.youtube.com/watch?v=QzvuS22HnSY&...feature=related

 

[romans holiday]

surely if we get high/hyper inflation, house price falls with be curtailed pdq.

 

I was listening to the guest speaker on fsn last week http://www.netcastdaily.com/broadcast/fsn2008-1122-2.asx who predicts that property will be a winner again (albeit eventually) listen from 40mins onwards

 

I realize that the difference with the 70's may be that this time the inflationary event will be coupled with recession, but even so, if the value of the money greatly decreases, tangible wealth such as property will retain some value against the depreciating currency

I think this is why we should consider gold as a base currency; the exit from a contracting bubble economy.

 

From the perspective of an investor looking to secure property [real wealth] when between a rock and a hard place.

 

The theoretical rock.

In a conventional chronic/hyper inflation you want to be in assets/property, and even have debt, as currency either slowly or quickly depreciates. Way out; go into property of some kind. If you can not afford property buy gold which doubles as an asset and an inflation proof currency. Use your deposit for a mortgage at some stage.

 

The practical hard place.

We are experiencing deflation where all assets are devaluing and cash it would seem is the place to be. However, with the theoretical rock [inflation] hanging above our heads and waiting to drop we feel it must come down to a matter of timing; wait for asset prices to decline then jump in as the tide turns to inflation. But the wild card here is that cash seems itself vulnerable to depreciation in the waiting period. Way out; buy gold the strongest symbol of money known and if anything is able to resist the force of deflation it will. Timing no longer matters as you can both wait for assets to decline and if hyper kicks in your currency is inflation proof.

[tinecu]

News: Land Registry Figures May Underestimate Price Falls

 

Mon, 01 Dec 08

 

The Land Registry has been criticised for underestimating the scale of decline in house prices.

 

Its latest figures, for October, show an annual 10.1% fall in house prices.But as they do not include sales from repossessions and auctions, which are on the increase, they may not be presenting an accurate picture.

 

http://www.home.co.uk/guides/news/story.ht...ate_price_falls

[Steve Netwriter]

House prices fall at fastest pace in 25 years

December 4, 2008

http://www.timesonline.co.uk/tol/money/pro...icle5284863.ece

 

British house prices tumbled at a record 16.1 per cent in November, marking the sharpest drop in property values for a quarter of a century.

 

Figures released this morning by Halifax revealed that prices fell 2.6 per cent in November compared with October, and are 16.1 per cent lower than in November 2007.

 

The year-on-year decline is deeper than falls recorded during the last recession in the early 1990s, and is the biggest drop since 1983.

 

The shock fall emerged just hours before the Bank of England's Monetary Policy Commitee (MPC) cut the interest rate again by 1 per cent to 2 per cent, after last month reducing borrowing costs by 1.5 per cent to 3 per cent.

[No6]

House prices fall at fastest pace in 25 years

December 4, 2008

http://www.timesonline.co.uk/tol/money/pro...icle5284863.ece

It's such a shame. Come on everyone, get out there and spend. Let's bring some confidence back, that's all it takes.

[G0ldfinger]

...

Pity HPC'ers didn't like us to talk about it though on their site!!!

 

SafeBetter

Yes, instead you have a sort of fascists system with heavy censoring over at the madhouse. And if you write the word "gold", you get banned. Such idiots!

[grumpy-old-man]

News: Land Registry Figures May Underestimate Price Falls

 

Mon, 01 Dec 08

 

The Land Registry has been criticised for underestimating the scale of decline in house prices.

 

Its latest figures, for October, show an annual 10.1% fall in house prices.But as they do not include sales from repossessions and auctions, which are on the increase, they may not be presenting an accurate picture.

 

http://www.home.co.uk/guides/news/story.ht...ate_price_falls

 

I spent 2 years telling/arguing everyone that the stats were being fudged EVEN the official ones. How they laughed.

 

As with everything, experience & common sense wins the day.

[Wanderer]

Hmm. As someone quite keen on a MAJOR correction in the housing market, I was alarmed to see this story about the return of (very cheap looking) 90% mortgages.

 

http://www.guardian.co.uk/money/2008/dec/0...tgages-property

 

I know many on here will be pleased to see this! I wonder how long it will last and whether this is a 'dead-cat' bounce in their availability or whether the banks are accurately assessing prices won't fall massively further from here? Or whether it is just a 'teaser' with only a small amount of funding available and most people being herded into more expensive mortgages?

[headmelter]

Hmm. As someone quite keen on a MAJOR correction in the housing market, I was alarmed to see this story about the return of (very cheap looking) 90% mortgages.

 

http://www.guardian.co.uk/money/2008/dec/0...tgages-property

 

I know many on here will be pleased to see this! I wonder how long it will last and whether this is a 'dead-cat' bounce in their availability or whether the banks are accurately assessing prices won't fall massively further from here? Or whether it is just a 'teaser' with only a small amount of funding available and most people being herded into more expensive mortgages?

 

 

Just wondering if it is calculated on sensible multiples ie. x3.5 times annnual salary.

 

I also wonder how it will look in 2-5 years time when interest rates aren't so low.

[tinecu]

Hmm. As someone quite keen on a MAJOR correction in the housing market, I was alarmed to see this story about the return of (very cheap looking) 90% mortgages.

 

http://www.guardian.co.uk/money/2008/dec/0...tgages-property

 

I know many on here will be pleased to see this! I wonder how long it will last and whether this is a 'dead-cat' bounce in their availability or whether the banks are accurately assessing prices won't fall massively further from here? Or whether it is just a 'teaser' with only a small amount of funding available and most people being herded into more expensive mortgages?

 

So they will lend 90% of the lender's valuation.

 

If the valuation comes in at 40% off the 2007 peak... I wonder if the sale will go through at all.

 

Banks are now justifiably backing bargain hunters...lower risk.

However, there is a real risk of a bull trap.

[G0ldfinger]

So, when the market goes up, these MoFos are happy to predict +15% a year. When the market goes down, these bastewards refuse to predict -15%. Bloody VIs.

 

Low house prices are good for everyone. Free houses would be paradise.

 

Halifax and Nationwide decide not to publish annual house price forecasts

http://www.telegraph.co.uk/finance/economi...-forecasts.html

 

EDIT: I think these guys should be prosecuted for market manipulation. This can't be legal.

[notanewmember]

Its starting, people will be so sick of houseprices that they don't want to know.

 

People are happy counting their profits.

 

People are not happy counting their losses.

 

 

[tinecu]

So, when the market goes up, these MoFos are happy to predict +15% a year. When the market goes down, these bastewards refuse to predict -15%. Bloody VIs.

 

Low house prices are good for everyone. Free houses would be paradise.

 

Halifax and Nationwide decide not to publish annual house price forecasts

http://www.telegraph.co.uk/finance/economi...-forecasts.html

 

EDIT: I think these guys should be prosecuted for market manipulation. This can't be legal.

 

I agree totally. Its criminal. Their property ramping reports in 2002/20003/2004/2005/2006/2007should be enough to make them party to the mass fraud that we have witnessed. The FSA should ask them 'do the contents of these reports suggest you possess sufficient financial insight to handle other peoples money?'

 

 

[G0ldfinger]

HPC have changed their layout. It looks like total sh1te now.

[Steve Netwriter]

HPC have changed their layout. It looks like total sh1te now.

 

You've gotta love the creativity of...........................white

 

[Paddles]

HPC have changed their layout. It looks like total sh1te now.

 

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...

[Pluto]

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...

 

Welcome to the dark side.

 

UK crummy property already down over 50% when bought in virtually any currencies apart from the terrible three. Icelandic Krone, Zimbabwe dollar, and British Pound. An elite club I might say.

[enrieb]

Welcome Paddles, its good to see poster of your caliber here.

 

I think that part of the reason that banks and building societies no longer want to report house price falls are that most of their assets are still tied up with the value of housing. Giving out predictions of realistic house price falls would be an admission of their own insolvency, with all the implications that has for the share prices and economy.

[electroweak]

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...

Welcome paddles. Hope the new year is a good one for you.

Initiation... hmmm... do you have any good rocket pictures? (don't post yet though!)

[frizzers]

London House Prices in ounces of gold

 

Currently Nov 08

 

Average Cost: £382,951

Detached: £778,868

Semi-detached: £416,499

Terraced: £417,058

Flat: £315,339

 

Gold at c £575 per ounce

 

Average Cost: £382,951 = 666 ounces

Detached: £778,868 = 1350 oounces

Semi-detached: £416,499 = 723 ounces

Terraced: £417,058 = 725 ounces

Flat: £315,339 = 547 ounces

 

Still got a long way to drop imo

 

 

 

100 ounces not impossible from here. I think I had 200 as a target once upon a time.

 

But 100 ounces from 666 now . That makes gold in London houses from here still a potential 6 1/2- bagger. Ouch

 

[Pluto]

London House Prices in ounces of gold

 

Currently Nov 08

 

Average Cost: £382,951

Detached: £778,868

Semi-detached: £416,499

Terraced: £417,058

Flat: £315,339

 

Gold at c £575 per ounce

 

Average Cost: £382,951 = 666 ounces

Detached: £778,868 = 1350 oounces

Semi-detached: £416,499 = 723 ounces

Terraced: £417,058 = 725 ounces

Flat: £315,339 = 547 ounces

 

Still got a long way to drop imo

 

 

 

100 ounces not impossible from here. I think I had 200 as a target once upon a time.

 

But 100 ounces from 666 now . That makes gold in London houses from here still a potential 6 1/2- bagger. Ouch

 

100z for a london 3 bedder in not so shitty areas coming your way soon. That is what I reckon - the price in pounds is really meaningless as the pound is unstable and is collapsing.

[drbubb]

SCHILLER said:

In London to promote his new book, The Subprime Solution, Shiller told The Observer that consumers should be wary of the comforting excuses many analysts find for explaining why Britain's housing market will be hit less hard than America's, where prices have already fallen by more than a quarter, and repossessions are rife.

'A lot of people say that in the UK we haven't seen so many defaults on mortgages - but we're just earlier in the cycle,' he said.

UNQUOTE == == == = == == == == == == == ==

 

He is right.

My charts identified a 17 month lag almost two years ago:

(Here's my original post from Aug.2007, right at the UK peak - see Link below):

 

I had originally seen the cycle as a 16-year cycle, and so expected the 2004/5 slowdown to mark the top of the UK property market. It looks like 16 years was wrong (it was based on only two prior cycles - not enough data.) I now believe that Fred Harrison will be right, and we are seeing an 18-19 year cycle. If so, the next low is due:

 

About: 1994 + 18 = 2012 or so.

 

These cycles are normally better at forecasting lows than highs, but if we use the same 18 years, then 1989 + 18 = 2007.

That fits with a Summer 2007 peak, as per the video.

 

= =

Here are some charts, showing how the exact peaks (in both the US and the UK) could have been timed by very careful observation of Long Term interest rates in the respective countries. A crossover of rates (and other MA's) above the 200week MA would have pinpointed the peak in the builders. I certainly believe that we are now some years into an upcycle in long rates in both countries

 

CHARTS, ETC. (from the 18 year cycle thread )

NAILING THE UK PROPERTY CYCLE : 17 months behind the US Real Estate Cycle

 

I just found a source of charts for UK Gilts, which helps me to nail down the UK's position in its 18 year cycle.

Basically, Gilt rates have now triggered a turn. We saw it first in the Builders in late 2006, and it will shortly spread

into nominal House Price Inflation

 

US 10yr Rates vs. US Builders ... Gilt update : Builder update

 

Gilt rates vs. UK Builders ... Gilt update : Builder update

 

If you look at the above charts closely, you will find some amazing similarities:

 

+ The Peak in Builders came as each country's long term rates were making a Higher Low

 

+ The "Higher Low" is a very specific one, it is the one from which a new rise in rates was launched,

which turned the 200week MA from falling to rising- so that made it eaiser to identify.

 

The Builder Peaks came:

+ In July 2005 for the US

+ In Dec. 2006 for the UK

= That's a lag of 17 months, with the UK behind the USA..

 

/source, post#12: http://www.greenenergyinvestors.com/index.php?showtopic=2277

[drbubb]

[Pluto]

Crummy old UK houses are on sale to those abroad. The other side of this coin is the foreigners who bought into the UK ponzi housing are 50% down.

 

http://www.telegraph.co.uk/travel/travelne...-Euro-zone.html

 

"Likewise French and Spanish buyers are finding the weakness of the pound, coupled with our falling property prices, has made buying a property in Britain up to 50 per cent cheaper than two years ago."

[Steve Netwriter]

This doesn't sound good for house prices or commercial real estate prices, or much else in the UK !

 

One in 10 shops will stand empty

27 Dec 2008

http://www.telegraph.co.uk/finance/newsbys...tand-empty.html

 

More than one in ten high street shops will lie empty by the end of next month as the retail collapse gathers pace, experts have warned.

 

The prediction comes despite a Boxing Day sales bonanza driven by unprecedented discounts and a last-minute Christmas Eve surge in gift-buying.

 

Retail analysts Experian said the number of shoppers at the December 26 sales was up 12.5 per cent on last year, while John Lewis said the final four shopping days in the run-up to Christmas saw sales rise 2.5 per cent on last year.

 

Harrods, whose sale was opened by Welsh singer Katherine Jenkins and store chairman Mohamed Fayed, is among the shops offering heavy discounts to boost trade amid the consumer spending slowdown.

 

However, despite high street discounts of up to 90 per cent, five retail chains have ceased trading in the past two weeks, and up to 15 more are rumoured to be on the brink of closure.

 

Small business leaders said the increase in boarded-up shops, coupled with an expected cull of bank and building society branches following this year's mergers, would make life even harder for those traders left behind.

 

Clinton Cards, Allied Carpets, JJB Sports and Land of Leather are among the stores struggling with mounting debts and falling sales.

 

Jonathan de Mello, director of property consultancy at Experian, said more than 1,300 sites currently occupied by chain stores - retailers with 10 or more branches - will be left empty following the demise of businesses including Woolworths, MFI and Zavvi.

 

He said: "With more shops going into administration, the proportion of these empty sites will rise to beyond 10 per cent by the end of January.