andrew_uk, on Feb 14 2005, 10:43 PM, said:
Ignore the spin, prices are falling.
While vested interests (mortgage lenders) use the black art of 'Seasonal Adjustment' to produce house price statistics which show a stable or even rising market the most important body has clearly stated that house prices fell.
The Land Registry figures, from the only body that does not make money from rising prices, have shown that national house prices fell between October and December last year by 2.7%, with London falling 3.7%.
These figures are based on actual sales prices which means that they represent transactions agreed last summer when prices traditionally rise, not fall.
Looking at more recent figures, Rightmove.co.uk - a company 29% owned by Countrywide Plc, the UK's largest estate agent - has stated that prices have fallen in five out of the last six months.
Incidentally, Countrywide - which owns John D Wood and Bairstow Eves estate agents, and others - has recently made 6% of its workforce redundant.
The forum members of www.HousePriceCrash.co.uk expect an average 30% fall in prices over the next three years. With a growing number of prominent academics and economists forecasting between this and even larger falls we may have underestimated the drop.
The only hope for a recovery in prices put forward by estate agents etc would have been an increase in transaction numbers but instead they are falling. Sales last quarter were down by 22% in the £100-£150K range and down 40% for properties below £100K.
Buyers - mainly investors - are increasingly worried about buying at the top of the market and with the massive number of available rented property they seem to have gone on buying strrike.
As the fall in prices gains momentum, will these people buy into a falling market? We do not think this is likely.
The chance of a quick sale has now passed for many and we recommend that anyone who bought in the last two years should seriously consider reducing there debt levels and focus on reducing their mortgage.
The recent offer of a 130% mortgage - a mortgage that instantly puts the owner into negative equity - shows lenders are more interested in their profits than the welfare of their customers.
But don't take our word for it. Look around. Talk to colleagues and friends who are trying to sell, Look at the special offers on new developments and count the number of 'To Let' and 'For Sale' signs. Then ask yourself: if everything is so rosy, why are estate agents shedding staff. Then think, what should you do in a falling market? If you are serious about selling keep your price 20% below the 'market'.
Here is my effort.