Properly slump deepens - UK down 3.2%, London 6.8%!
17 December 2007, 10:40 AM
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Properly slump deepens - UK down 3.2%, London 6.8%!
London house price fall of 6.8% in past month stokes economy fears - Times Online
I suppose if nobody's lending and people just can't borrow enough to buy, then price falls were bound to accelerate - but even in a quiet month these falls are steep! 
Expect the BoE will cut rates in Jan despite rising inflation, but whether it will have any effect is another thing as they appear to have lost control to an extent..
House prices in London have fallen by an average of £28,000 in the past month, as the capital sets the pace of an accelerating property downturn, a leading survey reports today.
The company’s data shows that house prices fell by 3.2 per cent across the country, and by 6.8 per cent in London, over the month to the middle of December.
Expect the BoE will cut rates in Jan despite rising inflation, but whether it will have any effect is another thing as they appear to have lost control to an extent..
17 December 2007, 10:48 AM
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I'm just amazed that prices went as high as they did, and that people actually thought they could be maintained, or even keep rising, despite history and other countries markets showing that they always go pop eventually!!
17 December 2007, 11:02 AM
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When I read this this morning I thought of you Pete 
This stastic is average asking price. As HIP's were introduced on Friday for smaller (and less expensive) houses, there have been many lower cost properties put on the market in the past 5-6 weeks. SO if you have two houses at a million quid on the market the average asking price is 1 million. Add one property at 300k and the average asking price drops by 24%
This stastic is average asking price. As HIP's were introduced on Friday for smaller (and less expensive) houses, there have been many lower cost properties put on the market in the past 5-6 weeks. SO if you have two houses at a million quid on the market the average asking price is 1 million. Add one property at 300k and the average asking price drops by 24%
17 December 2007, 11:47 AM
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I opened this thread knowing what I was going to read and who would be in it, but I expected a "mostly bollocks" comment from fast bloke 
I have been renting for 14 months now, not originally of choice because my intended purchase fell through. It will be interesting to see when or if interest only 100% mortgage + buildings insurance + repairs become less than rent on an equivalent property. That will be my signal to buy in again. I expect to wait 3 or 4 years for this to happen, so I'll be looking for another rental this summer when the present one runs out.
I have been renting for 14 months now, not originally of choice because my intended purchase fell through. It will be interesting to see when or if interest only 100% mortgage + buildings insurance + repairs become less than rent on an equivalent property. That will be my signal to buy in again. I expect to wait 3 or 4 years for this to happen, so I'll be looking for another rental this summer when the present one runs out.
Last edited by john banks; 17 December 2007 at 11:52 AM.
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17 December 2007, 02:14 PM
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sensationalist journalism as usual -
It should be noted that the "falls" referred to are falls in asking prices - not necessarily value. Asking prices are usually set by homeowners adding a few quid to the highest valuation from say, three agents.
"The falls took the national house price inflation rate down to 4.8 per cent, from 7.9 per cent the previous month, with a house typically losing £7,590 in value. "
That says to me that the rate of growth has slowed in the last month. It should also be noted that december is probably the shortest working month of the year (so naturally less transactions will occur) and christmas is the first thing on peoples' minds (so less likely to move). Dec is therefore usually the slowest month of the year in the property industry - and nov is not too much better - so there's little point in comparing with what sellers in the industry would call a crap month with what is usually even worse.
Having said that, there's no doubt that the market isn't as bouyant as it was this time last year...and it sells newspapers of course.
It should be noted that the "falls" referred to are falls in asking prices - not necessarily value. Asking prices are usually set by homeowners adding a few quid to the highest valuation from say, three agents.
"The falls took the national house price inflation rate down to 4.8 per cent, from 7.9 per cent the previous month, with a house typically losing £7,590 in value. "
That says to me that the rate of growth has slowed in the last month. It should also be noted that december is probably the shortest working month of the year (so naturally less transactions will occur) and christmas is the first thing on peoples' minds (so less likely to move). Dec is therefore usually the slowest month of the year in the property industry - and nov is not too much better - so there's little point in comparing with what sellers in the industry would call a crap month with what is usually even worse.
Having said that, there's no doubt that the market isn't as bouyant as it was this time last year...and it sells newspapers of course.
17 December 2007, 02:16 PM
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sensationalist journalism as usual -
It should be noted that the "falls" referred to are falls in asking prices - not necessarily value. Asking prices are usually set by homeowners adding a few quid to the highest valuation from say, three agents.
"The falls took the national house price inflation rate down to 4.8 per cent, from 7.9 per cent the previous month, with a house typically losing £7,590 in value. "
That says to me that the rate of growth has slowed in the last month. It should also be noted that december is probably the shortest working month of the year (so naturally less transactions will occur) and christmas is the first thing on peoples' minds (so less likely to move). Dec is therefore usually the slowest month of the year in the property industry - and nov is not too much better - so there's little point in comparing with what sellers in the industry would call a crap month with what is usually even worse.
Having said that, there's no doubt that the market isn't as bouyant as it was this time last year...and it sells newspapers of course.
It should be noted that the "falls" referred to are falls in asking prices - not necessarily value. Asking prices are usually set by homeowners adding a few quid to the highest valuation from say, three agents.
"The falls took the national house price inflation rate down to 4.8 per cent, from 7.9 per cent the previous month, with a house typically losing £7,590 in value. "
That says to me that the rate of growth has slowed in the last month. It should also be noted that december is probably the shortest working month of the year (so naturally less transactions will occur) and christmas is the first thing on peoples' minds (so less likely to move). Dec is therefore usually the slowest month of the year in the property industry - and nov is not too much better - so there's little point in comparing with what sellers in the industry would call a crap month with what is usually even worse.
Having said that, there's no doubt that the market isn't as bouyant as it was this time last year...and it sells newspapers of course.
17 December 2007, 02:26 PM
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Colleague went to an auction the other week.Used to be a frenzy of bidding.
Only half the properties went.
Another friend is selling bungalow.Was up for £190,000.Won't sell. Latest valuations from various agents...about £140-150k.
I think the government and the banks and all those in the industry know so much more about what is to come and I reckon they are very nervy (eg inject £50 billion)
I feel very anxious about things at the moment
Only half the properties went.
Another friend is selling bungalow.Was up for £190,000.Won't sell. Latest valuations from various agents...about £140-150k.
I think the government and the banks and all those in the industry know so much more about what is to come and I reckon they are very nervy (eg inject £50 billion)
I feel very anxious about things at the moment
17 December 2007, 02:27 PM
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That says to me that the rate of growth has slowed in the last month. It should also be noted that december is probably the shortest working month of the year (so naturally less transactions will occur)
You have also failed to mention the effects of the credit crisis, lenders increasingly tightening lending criteria, HIPS, falling buyer confidence. I suspect we'll see continued falls in prices - be it asking or sale, over the coming months. Only time will tell I guess
17 December 2007, 03:09 PM
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Sorry, what the difference?
The value of something, is what someone is prepared to paid for it, If the asking price has dropped, doesn't that amount to the same thing? Unless of course these properties are being bought by mentalists that for some reason make offers above the asking price?
17 December 2007, 03:12 PM
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The property is being sold by mentalists who reduce the asking price below its value of course.
17 December 2007, 04:10 PM
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How does HIPs affect the prices any more than the cost of the HIP? £600+VAT aren't they. so £700 tops.
I see a lot of people criticising pslewis and Petem95 (no completely without cause though) HOWEVER I ask this: What has to happen to convince you that prices are falling? What figures do you measure by? Agreed asking prices aren't best gauge however they tend to come down AFTER the realisation that prices are actually falling. Last month selling prices fell after all.
When the prices do start to continously fall then potential buyers stop buying (they wait untill the drop stops) further causing values to fall even more (vicious circle). No new buyer wants to buy a depreciating asset, especially when it comes to the valuation survey and the mortgage lenders won't put up the money as they are taking the risk for 1st time buyers.
Falls for one or two months aren't a major issue (can be merely a correction or slowdown in growth) but once prices keep falling after 4/5/6 months then the real slump begins.
I see a lot of people criticising pslewis and Petem95 (no completely without cause though
) HOWEVER I ask this: What has to happen to convince you that prices are falling? What figures do you measure by? Agreed asking prices aren't best gauge however they tend to come down AFTER the realisation that prices are actually falling. Last month selling prices fell after all.When the prices do start to continously fall then potential buyers stop buying (they wait untill the drop stops) further causing values to fall even more (vicious circle). No new buyer wants to buy a depreciating asset, especially when it comes to the valuation survey and the mortgage lenders won't put up the money as they are taking the risk for 1st time buyers.
Falls for one or two months aren't a major issue (can be merely a correction or slowdown in growth) but once prices keep falling after 4/5/6 months then the real slump begins.
17 December 2007, 06:29 PM
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Same situation in the commercial property sector. I read Estates Gazette yesterday and all sectors ie industrial, retail, office etc are down on the year. Proper figures from a proper publication
17 December 2007, 07:54 PM
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London house price fall of 6.8% in past month stokes economy fears - Times Online
I suppose if nobody's lending and people just can't borrow enough to buy, then price falls were bound to accelerate - but even in a quiet month these falls are steep!
Expect the BoE will cut rates in Jan despite rising inflation, but whether it will have any effect is another thing as they appear to have lost control to an extent..
I suppose if nobody's lending and people just can't borrow enough to buy, then price falls were bound to accelerate - but even in a quiet month these falls are steep!
Expect the BoE will cut rates in Jan despite rising inflation, but whether it will have any effect is another thing as they appear to have lost control to an extent..
Any idea what next week's lottery numbers are now your powers of clairvoyancy are obviously no longer in doubt?
17 December 2007, 08:35 PM
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Fact is, nobody in the know has predicted an exact time, because it's nearly impossible to do so. Doesn't mean it won't happen.
17 December 2007, 09:18 PM
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My point is if I predict that tomorrow will be sunny every day for the next 5 years I will eventually be right. In the same way Petem95 has been gleefully telling us how the market is about to crash for as long as I can remember.
Telling us over and over is one thing, but it is the fact he seems to revel in everyone's impending misfortune that makes it particularly distatsteful.
Hope that clears things up for you
17 December 2007, 09:33 PM
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Now that the long overdue correction appears to have begun a number of posters appear to have changed their opinions
17 December 2007, 09:50 PM
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Yes agree you never put a timescale on it as such but only because the 25 or so other times you have 'predicted' it would happen it didn't.
17 December 2007, 09:57 PM
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You elaborated on your point, and I confirmed that I'd understood you correctly in the first place. If you feel you need to further clarify your position, please do so.
17 December 2007, 10:22 PM
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I've never put a timescale on this event, I've just always insisted it will take place, whereas a number of others (yourself included I believe) have always said the hugely inflated prices would at worst 'level out', and would not fall.
Now that the long overdue correction appears to have begun a number of posters appear to have changed their opinions
Now that the long overdue correction appears to have begun a number of posters appear to have changed their opinions
Prices always change, they just do. House prices are not set for any sort of prolonged period of collapse. For one there are far too many greedy people ready to snap up bargains. Secondly, the government will simply loose the next election if this happens. There is no question about it, should there be a house price collapse its the end of their run. They will take the country to the darkest depths to avoid this.
There are also two incredibly important factors that existed last time, that are not present today. 1) Buy To Let was hard to get into if you did not know the right lenders. Not that many people therefore could/wanted to do it. 2) Lenders of old were allowed to sell repossessed property with scant regard to the price they achieved. Their only concern was to sell the house to recover the debt. These days they are simply not allowed to do that.
You really don't want house prices to collapse. As if they do it will great the most awful mess imaginable. Our gov will open its coffers to try and stave off a meltdown, they just don't want to loose power. If a collapse happens, the country as a whole will be broke.