Times Online: Debt won’t bring down our house of cards

An article to get you lot chomping at the bit!

Posted by talking rot @ 10:14 PM 14 Comments

Times Online: GDP figures since 2001 revised higher

Upward revisions to UK growth spanning half a decade will lend weight to the argument that interest rates must rise to combat inflation

thisismoney: Five years on: 10% worse-off

BRITISH households are 10% worse-off financially than five years ago as taxes, utility bills and car running costs have soared.

BBC News: UK economic growth revised upward

Better than expected economic figures boosts chance of UK interest rate rise.

Guardian: Don't believe the hype

How many times have we heard the doomsters warn that Britain's overblown property market is about to crash? Pundits have been predicting a painful end to Britain's ludicrously inflated house prices for years, and have got it wrong time and again.

Posted by webmaster @ 03:56 PM 7 Comments

BBC News: Japanese rate rise looks imminent

Falling unemployment and rising prices in the shops have pointed to an imminent end to Japan's long-held policy of zero interest rates.

Firstrung: Berkeley sees order book shrink by 15% as it reduces prices by 5.2%

Headline of "orders down 15% prices down 5%" is rather different from the triumph being heralded..

TimesOnline: King criticises Brown for delay filling MPC seat

Mervyn King the Governor of the Bank of England delivered coded but withering criticism of how Mr Brown goes about selecting members of the powerful interest rate-setting committee.

Daily Mail: Britons spend 40 per cent of earnings on mortgages

Mortgages amounting to nearly the same as the nation's GDP are costing the average household as much as they did in 1991. Which was, you remember, a great year for house prices.

Posted by Gruppenguhrer @ 08:36 AM 16 Comments

BBC News: US Fed ups interest rate to 5.25%

The US Federal Reserve raised its key interest rate as expected on Thursday by a quarter of a percentage point as it looks to slow inflation. The Fed's Open Market Committee has raised its key interest rate for the 17th time in a row to its highest level in over five years to 5.25%.

The Financial Express: The global housing boom

"Never before have real house prices risen so fast, for so long, in so many countries. Property markets have been frothing from America, Britain and Australia to France, Spain and China............ The rapid house-price inflation of recent years is clearly unsustainable, yet most economists in most countries (even in Britain and Australia, where prices are already falling) still cling to the hope that house prices will flatten rather than collapse........ ....... (but) a drop in nominal prices is today more likely than after previous booms for three reasons:......"

Money Week: How hedge funds affect house prices

The way the City chooses to describe various financial instruments can be quite instructive. If a company has a bad credit record with a significant chance of defaulting on its debts, then its debt is described as “junk”. But if an individual is seen as a poor credit risk, the loans they are offered are described as “sub-prime”.

Reuters: Bank holding fire on rates amid economic uncertainty

It looks as though the Bank is concerned about IR rises on the economy as a whole and sees insufficient inflationary pressure for interest rates to rise.

Posted by othello @ 03:28 PM 13 Comments

BBC News: Debt diary

The latest from our BTL-er coming to terms with the real world. Note that she has concluded that she has to offload one of her BTL's. This is significant if she is in any way typical of the hordes of wannabe property tycoons who have jumped on the BTL bandwagon, as the property market is now utterly dependant on new BTL sales to sustain prices. Any reversal of the trend toward more privately rented property - even a stabilisation - will completely undermine the market.

Posted by uncle tom @ 01:33 PM 7 Comments

Motley Fool: The Bears' Best Argument

If you include dividends, the Footsie share index has risen fourfold over the last 15 years. That's a pretty impressive return and I think low inflation has been a crucial factor behind that performance. Inflation has stayed low for several reasons...

Independent: Blair laid bare: the article that may get you arrested

In the guise of fighting terrorism and maintaining public order, Tony Blair's Government has quietly and systematically taken power from Parliament and the British people. The author charts a nine-year assault on civil liberties that reveals the danger of trading freedom for security - and must have Churchill spinning in his grave.

BBC: Mortgages debt tops £1 trillion

Good news! Mortgage debt is now over a trillion pounds! Which must mean we are all better off! That's what rising house prices mean doesn't it?

Firstrung: Sub prime market best described as "junk"?

If a company has a bad credit record with a significant chance of defaulting on its debts, then its debt is described as "junk". But if an individual is seen as a poor credit risk, the loans they are offered are described as "sub-prime". No doubt lenders would have a tougher time selling "junk mortgages" than the rather less judgemental-sounding "sub-prime" loans.

Guardian: Mortgage debt breaks £1 trillion barrier

Britain's collective residential mortgage debt has broken through the £1 trillion barrier, figures from the Bank of England showed today The figures suggest the mini-boom seen in the housing market earlier this year could still have further to go. ????

BBC News: US Fed seen hiking rates to 5.25%

The US Federal Reserve is widely expected to raise its key interest rate by a quarter of a percentage point on Thursday as it looks to slow inflation. A majority of analysts said they saw the Fed's Open Market Committee raising its key interest rate for a 17th time in a row to a five-year high of 5.25%.

BBC News: House price inflation 'subdued'

House prices rose 0.3% in June, figures from the Nationwide building society have shown, the third consecutive month of what it called "subdued growth". On a three-monthly basis, price growth slowed to 1% in the three months to June from 1.6% in the previous period.

BBC News: 555 posts may go in plant closure

A pharmaceutical company has announced plans to close its plant in Hampshire with the loss of 555 posts. The Eli Lilly site in Basingstoke has 445 employees and 111 contractors.

SKY News: Barclays Cuts 1,200 Jobs

Barclays has said it will axe 1,203 jobs within two years as part of a shake-up of its UK retail business. It is to close call centres and offices in Bexleyheath in Kent, Clacton in Essex and Dudley in the West Midlands.

Sky News: Millions refused credit

An estimated 3.5 million people have been turned down for credit during the past year as banks tighten their lending policies........... Sean Gardner, Chief Executive of MoneyExpert.com, said: "The days of easy credit are drawing to an end for many people."

Posted by Waiting Patiently @ 04:54 PM 7 Comments

smh.com.au: Buy, sell or stay put? Jittery property market

Confused by Sydney's real estate market? Don't know which direction prices are heading? Unsure whether to buy, sell or sit on your hands? You are not alone. Most experts agree that the downturn in Sydney's property market will continue until at least next year when prices should stabilise.

Morgan Stanley: Global Property Cycle Turns Down

Morgan Stanley economist Andy Xie says that global property booms are coming to an end - and could lead to a world recession as early as 2007 if bubbles start to burst.

Posted by Peter Argot @ 01:32 PM 18 Comments

TimesOnline: Borrowers in trouble boost Debt Free Direct

Debt Free Direct said pre-tax profits have ballooned to £5.13 million in the year to April and said it expected a fivefold increase in individual voluntary arrangements (IVAs) in Britain over the next three years. There are at least one million overstretched borrowers in Britain and the number is growing rapidly, despite comparatively benign economic conditions with low interest rates and high employment.

Posted by denzil @ 09:33 AM 6 Comments

FT: Fears over surge in high risk mortgages

The Financial Services Authority which has responsibility for regulating home loans is concerned that scoring techniques for this type of loan are robust but have not been tested through a downturn.

Firstrung: First time buyers to shun expensive inner city apartments

Tanya Jackson, media relations manager at the Yorkshire, said: "The trendy new build flat in the city could become a thing of the past. The younger age group that aspire to live in this type of property is increasingly priced out of the market. The vast majority of older buyers would prefer to live further out in older properties with period features. This means that without help to first time buyers, the trendy new flats that are rising in all our cities' skylines may become less popular."

This Is Money: Home repossessions treble

THE number of Londoners who face having their homes repossessed has trebled in five years, according to figures released today.

Inside Property: Property In England Branded As “Severly Unaffordable”

Property prices in every major metropolitan area have been branded "severely unaffordable" by Demographia's latest report and at a time when we are building homes that are the smallest in Western Europe and akin size wise to the concrete blocks of flats in Eastern Europe.

Firstrung: Mortgage approvals in May at highest level since 2002 - British Bankers' Association

Compared to the same month a year earlier, Mays loan approvals for house purchase were 20% higher by number, 33% higher by value. At 40% of all approvals, these were at their highest share since July 2002. Remortgaging approvals were 8% higher by number and 28% higher by value; however approvals for equity withdrawal were 7% lower by number and 1% lower by value.

Telegraph: UK debt mountain still growing

Britain's household debt mountain has continued to rise, according to new figures from the British Bankers' Association. An unexpectedly strong jump in mortgage lending during May suggests that the housing "mini-boom" could continue well into the second half of the year. The BBA said that banks approved 81,298 mortgages for house purchases last month, 20pc higher than last year.

Inside Property: Property In England Branded As “Severly Unaffordable”

Property is now severely unaffordable in every major metroploitan area in England - despite the fact that we are building the smallest houses in Western Europe. So not only are we fleeced on price, we are short changed on property size!

Daily Reckoning: Advantages of renting over buying property

But its not all bad news for tenants. You see, weirdly, in the future, you may be financially better off renting here in the UK. No - its true! In fact, mortgage lender Abbey says that in Wales, renters are ALREADY 27,000 better off over a typical 25 year mortgage period than buyers. In Greater London, they report that tenants are 8,188 BETTER OFF than homeowners over the same period!...

Posted by Webmaster @ 11:09 AM 19 Comments

TimesOnline: Markets face anxiety ahead of Fed's words

A fretful week in US financial markets is expected not only on the almost "set in stone" increase to US interest rates but on how much further they will have to rise.

TimesOnline: Central banks renew warning over inflation

THE world’s leading central bankers sounded a renewed alert over rising inflationary dangers yesterday and issued a warning that they may need to raise interest rates more aggressively to counter increasing price pressures. The sharp reminder to markets that central banks are on their guard against inflation came after three days of talks among their governors and senior officials at the annual meeting of the Bank for International Settlements (BIS) in Basle.

BBC web: Increases in pay 'averaging 3%'

Pay increases have averaged 3% over recent months, with only one-in-four people getting bigger pay rises than a year ago, research suggests. A report by the Industrial Relations Services analysed 181 pay settlements in the public and private sector in the three months to May.

myfinances.co.uk: Online article:

The increasing cost of essential items is hitting elderly Britons the hardest, new figures show. In the last two years the cost of items bought by over-75s has risen 46 per cent faster than the official headline rate of inflation would indicate, figures from Alliance Trust reveal.

Firstrung: First-time buyers driving a hard bargain by offering 6.3 per cent below the asking price

Research from Propertyfinder.com has shown a drop in confidence in the housing market. Confidence slipped for the first time in six months, house hunters have slashed their expectations for property prices over the next year from 7.7 per cent in May to 4.3 per cent in June. 78 per cent of respondents expect the market to rise over the next twelve months, down from the 84 per cent seen in May. This is the first such drop since December.

BBC web: US home sales defy rate pressures

Property sales are still robust despite rising mortgage costs. New home sales remain strong in the US, figures show, suggesting that successive interest rate rises have yet to subdue the property market. Sales rose a faster-than-expected 4.6% in May, although the average price of a new home did fall 4% to $235,300.

Posted by tyrellcorporation @ 09:19 PM 6 Comments

Businessweek.com: A Housing Bubble in Europe?

Overview of consequences high houseprices in certain parts of the eurozone but the ECB has limited powers to act as the overall picture is inconsistent.

Firstrung: Homeowners warned, the government will not pay your mortgage

Close on 4m people believe the government will help them out with their mortgage if they lose their job, new research from Lincoln Financial Group suggests. It says around one in 12 people surveyed say they think the government will pay their mortgage if they are unemployed while another 3m do not know whether it is the homeowner or the government that would keep up payments if they could not work.

Place In The Sun: House Prices To Start Falling In New Zealand Towards End Of Year Says Reserve Bank Governor

New Zealand's Central Bank has put up interest rates to among the highest in the developed world to combat rising house prices and the Governor says he expects those rises to start pushing prices down later this year. When will the Bank Of England act?

Money Week: Investing in property and housing

"You can't go wrong with bricks and mortar", they say. And with the phenomenal increase in house prices over the past 10 years, investing in property has looked like a dead cert. But is it now? After this incredible boom, is there going to be a gentle 'easing' of house prices, or are we in for an almighty property crash?

Firstrung: First time buyers head back to parental home as they can't afford to buy or rent

It's not just young adults who are being forced to move back in with their parents because of rising house prices and soaring levels of debt. An estimated 4.3 million single people aged between 25 and 50 have moved back to the family home after being unable to afford to live alone.

Posted by Converted Lurker @ 10:44 AM 14 Comments

Sunday Times: My property pram test

"Rightmove includes in its survey only the asking prices of houses that have been put on its website that month (not the sale prices, however) and ignores all those put on in previous months that may not have been sold yet, or sold at a much-reduced price. The survey therefore tells us nothing about what prices are really like, merely about what sellers and agents would like them to be like. These, as anyone who has ever tried to sell a house will know, are entirely different numbers." "This just isn’t the kind of environment in which house prices rise. I think they are falling and I think they are likely to keep doing so. Let’s not forget that the housing crash of the late 1980s and early 1990s took seven years from top to bottom. "

Posted by Doomwatch @ 10:40 AM 6 Comments

Yahoo news: House price growth fastest in year and a half

Vested interest survey ... blah blah ... property prices soaring ... blah blah .... please don't leave us ... blah blah ... we need your business.

Posted by inbreda @ 09:46 AM 6 Comments

Firstrung: Hometrack, June's house price survey

House prices grew by 0.6% over June, taking growth over the first six months of the year to 2.9% according to the latest monthly survey from Hometrack, the housing information business.

Firstrung: Firstrung, first time buyers, the week in focus

The Nationwide report on first time buyers was perhaps the major news item of the week. Underpinned by comment from their chief economist and convincing graphics, FTBs could be forgiven for believing that conditions favoured a group that has diminished rapidly. However, the key thrust of the Nationwide argument is that a "fresh faced FTB" is not in fact an FTB. Is this the point at which the report loses all credibility, or did it lose the attention of most FTBs when insisting that 40% of current buyers were first time?

Finfacts: Free Lunch Has Yet To Be Invented

What will happen to the Irish economy when the construction industry goes into recession - it currently employs 20% on the private sector workforce on an average salary of €40,000? And what will happen to other jobs when most of the multi-national leave Ireland for countries with lower wages?

Posted by Peter Argot @ 08:54 AM 7 Comments

Moneyweek.com: How the credit crunch will hit property

The most important asset that stands behind this debt nightmare is the housing market, which in America is crumbling. Chickens are coming home to roost and debt deflation is likely to be hatched from their eggs.

Firstrung: First time buyers scheduled to make comeback - A&L

A&L begin another monthly assault on our senses in relation to FTBs...ho hum...

Moneyweek: Where is the housing crash?

The last housing crash happened over a seven-year period, much like a falling line of dominos. So far, our domino effect has halved mortgage equity withdrawal, the rate of personal spending and economic growth in the space of just a few months.

Motley Fool: The Terrible Truth About House Prices!

Frankly, I'm stunned that UK house prices have continued to rise for as long as they have. Indeed, according to data from the Halifax, the average house price has risen every single year since 1996, notching up a ten-year winning streak, as the following table confirms:

Scotsman: In the midst of life, we are in debt . .

Article written by banker concerned about our growing addiction to debt, high house prices and low interest rates. As is pointed out in the article, the music has to stop at some point.

Posted by Peter Argot @ 11:29 AM 7 Comments

Firstrung: Real estate bubble to expose all kinds of fraud that people happily ignored as prices rose

Bubbles have a way of exposing all kinds of fraud that people happily ignored as long as prices were rising. When the party ends, the lawsuits begin. We saw the same thing when the dot-com bubble burst. We will see it again over housing.

Firstrung: Shelter affordable housing campaign given thumbs up by select committee

The select committee has backed Shelter's campaign for an extra 20,000 social rented homes a year.

SKY News: 'Empty Shelves In Days'

Asda supermarket workers are to stage a five-day strike from June 30 in a dispute over pay. Unions say the strike will lead to empty shelves in stores within days. Thousands of workers at the supermarket voted to take industrial action over pay and conditions.

Posted by webmaster @ 04:13 PM 10 Comments

Garrington: Mixed Messages

Sentiment in the housing market remains hot but there has been turmoil in the equity markets and talk of an interest rate hike.

Yahoo: BoE plans to beef up economic research to cope with uncertainties in data

The bank looks set to include surveys of business confidence when the MPC make decisions due to uncertainty regarding official data

Place In The Sun: Jailed Property Fraudster In Dubai A Warning To All Overseas Property Buyers

The jailing of a property fraudster for 30 years after he made millions from non-existent property developments in Spain and the Middle East should be a timely warning to all would be fly to buy investors

BBC News: Death of MPC member

The BBC reports the sudden death of a member of the MPC. Walton was the one member who voted for a rate hike at the last meeting, and the gilt market surged on the news. Always a bit worrying when someone who is younger than you dies suddenly...

Posted by uncle tom @ 11:38 AM 19 Comments

Yahoo: Bank of England policymaker suddenly dies

David Walton, the only Bank of England policymaker to call for an increase in British interest rates earlier this month, died suddenly late Wednesday, the central bank has announced.

BBC News: Reader diary: Dealing with my debt

Thousands of people in the UK are struggling with ever-increasing levels of personal debt. BBC News website reader Sayara Beg, 36, a freelance IT consultant from East London, has been telling her story of dealing with debt.

Posted by Geed @ 11:06 AM 19 Comments

Money Week: How big is the inflation threat really?

This piece comments on the outlook for inflation within key economies, notably UK, US, Europe, China and Japan. It ends with the belief that global growth will take a turn for the worse and therefore there is logic against rising interest rates. It states there is no reason for UK rates to rise.

Posted by talking rot @ 10:14 AM 7 Comments

kilkennypeople.ie: House prices soar 261% in a decade

Local house prices jumped 261% over the past ten years, according to a report published yesterday.

BBC News: 'Extreme debt' levels get worse

Levels of 'extreme debt' in the UK are worsening, says a charity which has seen the number of its clients owing more than £100,000 nearly double. The Consumer Credit Counselling Service saw the number of clients in extreme debt rise from 1.4% to 2.7% in a year.

Firstrung: Rightmove captures new build advertiser business

The Amazon of the property world?

Firstrung: How the credit crunch will hit property

The most important asset that stands behind this debt nightmare is the housing market, which in America is crumbling. Chickens are coming home to roost and debt deflation is likely to be hatched from their eggs. Once the loose credit process goes into reverse, and we think it has already started, then the suppliers of credit will gradually remove themselves from the market and anybody out there who wishes to continue to monetarise their debt won't be able to. Instead they will unavoidably default and the truth will be out.

Telegraph: Bank headed off property crash, says OECD

Homeowners can breathe a sigh of relief - the UK housing market is now less likely to crash than most other Western countries, according to authoritative new research....

Posted by Stefan Harris @ 03:08 PM 30 Comments

Irish Examiner: Young people 'exiled' by house prices, say Fine Gael

Fine Gael are proposing that the government contribute towards huge deposits now needed to get on the housing ladder - or risk losing a generation of young people who will go abroad

Posted by Peter Argot @ 10:50 AM 21 Comments

Bank Of England: PDF: Minutes of the Monetary Policy Committee June 2006

Those voting to hold were: The Governer, Rachel Lomax, John Gieve, Kate Barker, Charles Bean, David Blanchflower, Paul Tucker. David Walton preffered an increase of .25 basis points.

Posted by denzil @ 10:25 AM 6 Comments

FT: Treasuries fall on strong housing data

US data suggests a less dramatic softening of the housing market but a slowdown is still expected. “The trend in housing activity is strongly downwards,” said Ian Shepherdson, chief US economist at High Frequency Economics. In the UK The British Bankers Association reported the biggest rise in monthly lending for two years.

Firstrung: Growing army of private landlords criticised in latest government report

"The growing army of private landlords criticised in this report is the direct result of the Government's planning policy which requires housebuilders to build high density homes on the limited land released for development, in other words, apartments."

Place In The Sun: Auckland House Prices Hit Record High Despite Talk Of Softening New Zealand Property Market

Interesting round-up of what is happening in the New Zealand housing market where things appear to be at much the same point as they are in the UK - prices rising fastest in the capital, concern regarding over-borrowing, talk of softening market, etc., - only prices seem to be half of what they are here.

SMH.com.au: Real estate slump has three years to go

House prices in Sydney will fall for three more years because they are still too expensive despite a 2½-year slump, a forecaster warns.

dash24: Lloyds TSB issues warning over bad debts

Lloyds TSB seem to be in trouble...

FT: Public borrowing goes deeper into the red

In his March budget the chancellor predicted lower public borrowing but since then accounts have plunged deeper into the red. Jonathan Loynes of Capital Economics said the data did not support the view that public finances were on an improving trend. Loynes said, "We still think further significant tax increases will ultimately be required to put the public finances back on a sustainable footing”.

Posted by denzil @ 12:59 PM 6 Comments

Western Morning News: You'll never afford a home

Thousands of Westcountry youngsters may never be able to afford a home in the communities where they were brought up - even if many more homes are built, MPs warned last night. In a gloomy report, the Commons housing and planning committee said demand from incomers and second home buyers seeking houses in popular rural areas such as Devon and Cornwall may keep prices out of the reach of people on local wages forever.

BBC: May sees bumper mortgage lending

Gross mortgage lending in May hit £27.8bn the second highest figure since records began in May 1987 according to the Council of Mortgage Lenders (CML).

Posted by denzil @ 11:21 AM 6 Comments

Firstrung: Will a London boom save the UK property market?

Apparently "the mini-boom in prices continues to be led by the south of the country" where the average annual rise has now reached 9.4%. Sounds impressive, eh? Well, perhaps - until you look under the bonnet...

Firstrung: Mortgage lending up in May - BBA

Mortgage lending rose by its biggest amount in just over two years in May, British Bankers' Association data showed on Tuesday, causing some industry commentators to believe that house price rises will continue a modest rise for the next two quarters of 2006.

BBC Web: China to stem 'excessive' credit

China's central bank has said it will strive to stop the "excessive" availability of credit and money. The bank made the announcement following a quarterly monetary policy meeting, but gave no further details.

BBC Web: Death blow to rate tarts?

On the quiet, the banking industry has been steadily fighting back against a group of people who have been draining it of hundreds of millions of pounds in potential profit. They are the rate tarts, people who move their borrowings from one credit card to another in search of a cheap deal. Now, their opportunities to be as promiscuous as they like - in a strictly financial sense - have shrunk.

Bloomberg: Homebuilder Confidence in U.S. Drops to 11-Year L

"Confidence among U.S. homebuilders dropped to an 11-year low this month amid a glut of unsold homes and rising mortgage rates."

ADVFN: Federal Home Loan Mortgage Corp Foreclosures may jump as ARMs reset

Repossessions and a credit shock on the way in the U.S.?

BBC: 'Returners' boost housing market

Nationwide have decided to class buyers returning to the market as First Time Buyers (FTB). Fionnuala Earley, defied those that said a turd can't be polished by saying, "No longer can we think of first-time buyers as the fresh-faced young person or couple,....Rather the category includes a significant proportion of buyers returning to the market...such buyers often have access to deposits funded from past increases in house prices" Err, don't want to state the obvious Ms Earley but buyers returning to the market are not FTB unless of course you want to redefine the English language. Now the key words from Ms Earley are, "such buyers often have access to deposits funded from past increases in house prices". So they're not FTB then Ms Earley, doh..... This little article smacks of desperation in its finest form.

Posted by denzil @ 05:13 PM 10 Comments

Firstrung: First time buyers report - nationwide

"First-time buyers are often heralded as the main driver of the housing market. The proportion of first-time buyers in the market has been falling over time, but, given the rapid rise in house prices, the resilience of this group is perhaps a little surprising. Remarkably, first-time buyers still account for almost 40 per cent of all house purchase transactions in the UK." - 40%, Really?

TimesOnline: Brown's long years of largesse are over

AFTER a long period of living at the limit of, or beyond, their means, people often find it all too easy to put off the painful moment when they must confront reality and tighten their purse strings.

NZ Herald: Sydney property slump set to continue

A prominent Australian housing industry forecaster says the Sydney market is facing another two years of declining property prices.

TimesOnline: Rate rise threat recedes as Bank finds fears of inflation declining

The Bank of England (BoE) survey of the publics perception of inflation found that concerns about inflation are lower than they were three months ago. The current public perception is that inflation is around 2.5% down from 2.7% recorded in February. The BoE are supposed to be very interested in the publics perception as it can be a key driver in wage negotiations. The question is whether the figures of actual inflation i.e those produced by the Office of National Statisics (ONS) or public perception will drive Monetary Policy Committee (MPC) to adjust interest rates or is the survey of little consequence?

Posted by denzil @ 09:21 AM 16 Comments

Firstrung: UK house prices continue microscopic movements, up 0.8% in May - Rightmove

Despite the positive 'push' this is quite a reversal in comparison to the previous set of figures.

Posted by Converted Lurker @ 12:41 AM 8 Comments

Firstrung: First time buyers, the week in focus

Another week packed with information for first time buyers and yet as each week passes there is precious little evidence of improvement in circumstances for first time buyers increasing their ability to make that critical step onto the much fabled first-rung.

Observer: Lenders try to lower the ladder

For those rare individuals who are not busy watching the World Cup every night, now is the traditional house-buying season. But it is not only the lure of watching football in the pub that is putting off first-time buyers. Affordability problems are making increasing numbers opt to continue renting or stay at home with mum and dad. ...The Council of Mortgage Lenders' report concluded that many in this age group may be better off renting for longer.

Scotsman: Population decline to hit price of property

HOUSE price increases could slow dramatically unless the decline in Scotland's population is reversed. Thousands of Scots who have sold their homes have reaped the benefits of soaring property values sparked by low interest rates over the last five years.

Firstrung: "First time buyer numbers up 40% in a month? Where are they buying, Pluto or La-La land?"

When referring to recent media articles the Firstrung opinion is that references are made to first time buyer 'activity' only and not offers on property leading to completion, in an attempt to bolster 'good news' stories. Picking up a description and offering an agent contact details does not a returning first time buyer make. However, with completions now averaging seventeen weeks, the body representing estate agents (NAEA) could be forgiven for wanting to rally the troops.

Sunday Telegraph: It's time to pay attention to Japan.

Japanese interest rates could rise in increments to 3% "starting as early as next month" with a profound effect on the global economy.

Sunday Telegraph: The Odd Couple

The relationship between the chancellor and the governor of the Bank of England is becoming increasingly tense with profound disagreement between them over the state of the UK economy and growing disquiet over Brown's role in selecting members of the MPC.

BBC News: Tories Attack Home Siezure Plans

The government has been accused of using the World Cup to "bury bad news" over measures to seize empty homes. Empty Dwelling Management Orders allow councils to requisition properties which are unoccupied long-term.

Independent Online: Debtors are warned that bankruptcy is no soft option.

Thousands of cash-strapped borrowers who are preparing for bankruptcy have not understood the hardship they will face as a result, according to a warning from the debt specialist One Advice. It claims more than 110,000 people are considering declaring themselves bankrupt this year, in many cases because - wrongly - they consider it to be a soft option.

Posted by uncle chris @ 04:51 PM 9 Comments

Telegraph Online: Word on the street: is the ghost of crashes past hovering over the housing market?

As you're probably aware, the stock market has been having a miserable time of it over the past month. In fact, markets around the world have hit a patch of extreme turbulence, that has sent them rocking and reeling and wiped out most of the gains made since the start of the year. Does this mean that there are serious negative implications for house prices? I thought not until, the other day, someone reminded me that, barely a year or so after the notorious "Black Monday" crash in 1987, house prices started to tumble.

Daily Mail: Homes of the dead to be seized by the state

Bereaved families could have the homes of dead relatives seized under new laws that allow the state to commandeer empty properties. Local councils will be able to take control of inherited homes if they are left vacant for more than six months.

Daily Mail: Homes of the dead to be seized by the state

Bereaved families could have the homes of dead relatives seized under new laws that allow the state to commandeer empty properties. Local councils will be able to take control of inherited homes if they are left vacant for more than six months.

Firstrung: House selling packs to be huge flop - Telegraph

About time the Telegraph showed its true colours. In wheeling out their two biggest hitters, George Jones and Rosie Murray-West, they really have gone for the home run on this subject. The fact that their commentary is riddled with assumptions and mis-conceptions shouldn't deter the reader. Amongst the bad points, there are one, or two points worth consideration. However, despite best efforts and extensive piloting, the introduction of the packs will experience teething troubles. These will surely be countered by the revisions brought to bear in a market that is well overdue an overhaul?

BBC: FSA warning on mortgage exit fees

The Financial Services Authority (FSA) has asked mortgage lenders to justify their high mortgage exit fees.

Firstrung: Mortgage information to be revealed at Land Registry

This could get interesting, "So you paid 150K three years ago, you want 250K and your oustanding mortgages are 200K, that X5 you 'mewed for' didn't come cheap did it?"

BBC News: Debt diary

This is the first of a series of articles on the Beeb site. Interesting reading as it sheds light on the attitude to debt of a young urbanite in the capital. Note how despite admitting to being in heavy debt, there is virtually no admission of fault on her part. Note also her indignation at the very reasonable responses she gets from her lenders. Oh - and she also has a couple of BTL's...

Posted by uncle tom @ 09:37 AM 11 Comments

Firstrung: First time buyers increase from 7.9% to 12.5% in May according to the NAEA

Does this press release highlight fact, are first time buyers increasing? A rise from 7.9% to 12.5% in a month would represent a massive upswing in confidence at a time when house prices are still accelerating, (according to the NAEA), if only it was as simple as black and white...

Posted by Converted Lurker @ 09:24 AM 7 Comments

newsinsight.net: UK wants Indian support for Blair

The UK has been pushing India the past month to back Tony Blair for the position of UN secretary general, hoping thereby to overcome Asian and European opposition, but that is unlikely.

Posted by skannan @ 04:11 PM 7 Comments

Firstrung: London house prices rising at their fastest pace for four years - RICS

The fact that RICS can suggest that house price inflation has been caused by a shortage of property and not, as most reliable sources now accept, low interest rates and cheap available credit, should be another concerning issue open to debate and criticism in their latest findings.

Firstrung: Homeowners waste £154billion on DIY home design crimes

Britain's homeowners have spent more than £154 billion on tasteless home improvements that will actually reduce the value of their properties, according to new research from Direct Line Home Insurance....

Evil Auntie!: US price growth fuels rate fears

US consumer prices climbed 0.4% in May, driven by a sharp rise in energy costs. The rise, in line with expectations, increases speculation that the US Federal Reserve will raise interest rates when it meets later this month. The Labor Department said core inflation, which does not include food or energy costs, increased by 0.3% for a third consecutive month.

Firstrung: Home information packs and the energy performance certificate

Finally we get to the real reason for the introduction of the HIP - compliance with Euro dictat - which is obviously why the Tories have been in defiant opposition...

BBC: Home buyers stretch cash limits

Believe it or not the title of this entry in the blog was the output of a survey. Was a survey really required to state what most children would understand. According to the BBC, Director General for the Council of Mortgage lenders (CML) Michael Coogan played down worries that borrowers were becoming overstretched. Is Michael Coogan the brother of Steve?

Posted by denzil @ 02:59 PM 7 Comments

Firstrung: House sales to increase after the world cup - Haart

That was quick, the competition is only 5 days old, here's what one young fan thinks of the news...

BBC News: Further rise in UK jobless total

The number of people out of work in the UK has increased yet again, Office for National Statistics figures have shown. The jobless total rose by 77,000 to 1.61 million from February to April, lifting the unemployment rate to 5.3%. "While the manufacturing sector continued to suffer, the biggest increases in jobs came in education, health and public administration. "

Posted by tyrellcorporation @ 12:00 PM 14 Comments

Priced Out: Aberdeen University launch study into effects of high house prices

Sociologists from the University of Aberdeen have launched a new study into the effects that unprecedented high house prices will have on people aged 18-40. The study, "On the Treadmill", will research the effects of high house prices, high levels of debt and the implications of current global labour market trends such as globalisation.

TimesOnline: Markets dive again as gloom envelops the globe

Markets are concerned that on the back of potential poor US inflation figures the US Federal Reserve may push rates up sharply jeopardising future US growth. Richard Bernstein, chief investment strategist at Merrill Lynch said, “What amazes me is people’s confidence in the Fed, that they will get it right. The Fed has never gotten a [rate] tightening cycle right.” Bernstein also pointed out that the renewed "inversion" of the US yield curve with rates on short-term rates now higher than ten-year Treasury bonds. This normally indicates that recession follows between 2-8 months later. Now from my understanding if the Fed have to keep raising rates to control inflation at the expensive of growth then surely "stagflation" must be a serious issue.

In2Perspective: Hawking: Humans must house-hunt in space

We should find new homes elsewhere in the solar system in the next few decades because there's an increasing risk that the Earth will be destroyed, claims Stephen Hawking.

Firstrung: Britain, a nation of home obsessives

"Yet the joke is on homeowners. The bugbear about rising real-estate prices is that, so long as you live in your house, you cannot cash in. Unless you die - one of the only ingenious routes to capitalising on the craze - selling involves buying another house, whose value has also risen, and costs just as much as the one you sold."

Firstrung: Co-buying, joint ownership, beware the stranger danger

The craziest method of getting on the first rung ever, other than the last time it was suggested - 1989/92 - remind me, what happened next?

The Independent: Why the real rate of inflation is twice what the official figures tell us

Official figures later this morning are expected to reveal that inflation rose to 2.1 per cent from 2.0 per cent last month. While this will create huge excitement among City traders betting on the next move in interest rates, it will leave millions of ordinary people scratching their heads in bewilderment. Perhaps with good reason.

Posted by Nelson @ 02:25 PM 8 Comments

TimesOnline: Rate panic drags stocks to six-month lows

Stocks hit a six-month low as concern over growth and inflation force markets to press the panic button.

Posted by denzil @ 12:52 PM 7 Comments

TimesOnline: King strengthens expectations that rates will stay put

This is a very subjective piece by Gary Duncan the economics editor of the Times where he concludes that Mervyn King's comments indicate that there will be no movement in UK interest rates. It would appear that the financial markets do no share Gary Duncan's view. It's worth a read but hard to understand how Duncan reaches his conclusion.

Daily Telegraph: Monday view: Storm clouds gather over a US economy heading for icebergs

Like a thunder clap too close for comfort, the US bond market last week issued its time-honoured warning of recession. This time for real. The yield on 10-year Treasuries slid below the short-term rates, an emphatic signal that investors are more worried about a US housing bust than surging inflation............

Independent: A&L closes accounts of dissident customers

The battle between banks and customers over inflated overdraft charges turned still more acrimonious last week after it emerged that Alliance & Leicester was routinely closing the accounts of those taking legal action.

SKY News: Shares Nosedive Again

The FTSE 100 has dived sharply again following a bloodbath in Tokyo overnight. Fears over inflation and higher interest rates wiped 4% off Japan's Nikkei, a loss of more than 600 points and the largest fall the index has seen since September 11, 2001.

BBC News: US budget deficit higher in May

The US federal deficit exceeded expectations in May but the budget shortfall remains much lower than at the same stage last year.

BBC News: Energy bills push up UK inflation

Higher gas and electricity bills helped to push UK inflation up to 2.2% in May, from 2% the month before, official figures have shown.

Independent: Pressure grows for a £2 rise in minimum wage

Minimum wage to rise to living wage by £2? Governement is tired of subsidising employers and admits that it is not possible to live on the current peanut allocation.

The Guardian: You Brits all want a patch of earth to call your own - but only because you're obsessed with its escalating value. It's sheer greed

Award-winning novelist (and Guardian columnist) Lionel Shriver, an American, takes the British to task for their obsession with house prices and property porn TV shows, pointing out the fact missed by the majority that, if your house has risen in value to "several bazillion pounds", then so have everyone else's.

BBC Website: Economy faces bumpier time - King

The global economy is set for a more turbulent time after a period of strong economic growth, Bank of England governor Mervyn King has warned.

Times Online: : focus on Japan

Anatole Kaletsky of the Times reports on his impression of where B of J rates will go following his recent trip to Japan

Firstrung: Interest rate rises expected by consumers

How hot will the temperature have to get before it's too late for trapped consumers?

TimesOnline: Oil price a risk to growth, warns Brown

Gordon Brown speaking this weekend at the G8 finance ministers meeting in Russia said, "There’s a recognition that the world economy has had three years in a row of some of the fastest overall growth since the 1970s. But inflationary pressures exist because of oil. Interest rates have been going up in most of the big areas. There are obviously some vulnerabilities as a result of political instability and we’ve got to be vigilant.”

Posted by denzil @ 01:43 PM 10 Comments

Times: Factory gate inflation hits eight-month high

Factory gate prices rose by more than expected in May to hit their highest growth rate in eight months as petrol prices hit new highs, according to official figures released today. The Office for National Statistics said output prices rose 0.3 per cent on the month, taking the annual rate up to 3 per cent from 2.5 per cent.

BBC Web (Where else!): House prices showing spring spurt

House prices have risen in April, according to Department for Communities and Local Government (DCLG) statistics. Between March and April, the average house price in the UK rose from £186,519 to £188,290, the DCLG said.

Firstrung: Debt and social misery: the flipside of Britain’s financial services boom

The immediate reaction from many readers would be to see the origin of this press release, the world socialist web site, www.wsws.org and simply dismiss the views as being; too extreme and polarised from the mainstream as to have credibility. The Firstrung team would suggest that you give this article careful consideration as we defy any reader not to find agreement with several aspects of the content

Home.co.uk: Real-Time Gauge Of Housing Market Confidence

A seasonal rise in asking prices but the overall trend is downward, especially for London.

TimesOnline: Traders prepared for more market upset as US inflation figures loom

US inflation figures due this coming Wednesday could trigger another sell-off in equities. Wall Street Analysts have predicted a 0.3% increase in core inflation for items other than food and energy. An increase greater than 0.3% could spark off another sell-off in equities worldwide.

Euro2Day: News Article

Alliance & Leicester PLC is looking to grab a slice of the growing buy-to-let mortgages market and will shortly unveil a new range of products backed by US investment bank Lehman Brothers.

In2Perspective: Bishop attacks house price god

The Bishop of Norwich has warned that Britain has "bowed down before the [housing] market as a great god.” Criticising housing culture, he condemned spiralling prices for wrecking first-time buyers' chances of getting on the property ladder.

Posted by bufferbear @ 12:31 AM 15 Comments

Firstrung: New home prices have risen only 1.3% over the last twelve months

However, strip away the London 'weighting' in the figures and most UK areas have seen a fall in prices. Could many industry commentators be correct in watching new homes data closely for a clue as to what lies ahead for the market as a whole?

Firstrung: Real estate bubble and the housing spin

Allow me to translate: Interest-sensitive housing markets = "Bubbles", Vulnerable = "Ready to pop"

TimesOnline: A correction in the markets that needs to be corrected

Leading bankers are beginning to talk openly about interest rates rising for several years and look determined to tighten the reins on borrowers and investors.

FT.com: Ten per cent deposit is new lure for buy-to-let investors

Two mortgage lenders this week relaxed their lending criteria to enable potential BTL investors to purchase their investment with as little as a 10% deposit.

Firstrung: Firstrung, first time buyers, the week in focus

Another week, another small chapter in the plight of the FTB. Is the HBOS report more relevant than most mainstream commentators were prepared to admit? A 0.1% increase in prices at the peak selling time caught many by surprise. Surely the market for nation-wide house price inflation has no more oxygen to feed it?

Sunday Telegraph: The euro on a roller-coaster ride

Bearish article from Bootle who foresees a strengthening euro and rising interest rates globally. Seems to have changed his mind on UK rates which he has previously forecast to fall : "Rates here (UK) have so far held steady but the odds against a rate rise have been shortening". Predicts asset valuations to come under pressure : "central banks (have been) running very low interest rates and presiding over huge rises in liquidity. This has produced extremely buoyant asset markets, which took valuations to excessive levels. And this set the markets up for a fall. The realisation that central banks are in the pro-cess of backtracking from their expansive mode, coupled with rather worse inflation news, made markets realise how vulnerable valuations were and how it was about time that they recognised the notion of risk - and priced for it accordingly. There is probably more market turbulence - and weakness - to come."

Posted by Waiting Patiently @ 10:43 AM 6 Comments

Firstrung: FTB's could see their buying power reduced by 100K

Are they the lucky ones if they are prevented from boarding onto the ship of fools as it's about to hit an iceberg?

HPC: Base rates rise for Denmark and South Africa

Denmark and South Africa both raised their base rate on Thursday by 0.25% and 0.50% respectively.

Firstrung: First time buyers need interest rate hikes not stability

Surely a rise of perhaps 0.5% would have far more benefit to first time buyers? A consequential drop of prices by 20% would save far more money in the long term than rate stability?

Gold Seek: A Slow Unravelling - Or - Will it Turn into a Crash?

A round up of the current fiscal nightmare unfolding in the US

Motley Fool: Article

Motley Fool predicts the next move is upwards

Independent online: Article

The export industry is even worse than thought...

FT.com: Goods import prices rise at fastest rate for decade

For most of the past decade imports have been getting cheaper but the tide appears to be turning as imports are no longer getting cheaper but have risen by 3.6% YoY excluding oil but when oil and erratic goods are included the figure rises to 6.7% YoY. So excuse me for stating the obvious but how can UK consumer price inflation (CPI) only be 2%? It's would seem that Gordon's miracle economy truly is miraculous.

BBC News: Thames Water wants drought order

Thames Water, which supplies five million people in London, has applied for a drought order. The order would affect London and small parts of Kent and Surrey, but leave three million other customers in the Thames Valley unaffected.

Firstrung: House price boom, or the bonfire of our vanities?

"7% rise in value of your home" screamed the Daily Express's front page yesterday. "A booming market sends prices spiralling upwards and it will get even better". As a headline, it made a change from the latest conspiracy theories about Princess Diana. But it's no less far-fetched.

BBC News: UK trade gap widens to £5.75bn

The UK's global trade gap widened more than expected in April, Office for National Statistics (ONS) data shows. The trade deficit grew to £5.75bn in April from an upwardly revised £5.7bn a month earlier, although analysts had expected the gap to remain unchanged.

Firstrung: First time buyers can put parents financial welfare at risk

Despite the push from lenders thankfully guarantor assistance from parents is still quite low. If you can`t afford to buy, then don`t encourage others to lend you the deposit surely? If values fall by only 10% that 10% deposit is toast..

Financial Times: FT index shows house price revival continues

"House price inflation continued to pick-up last month, taking the annual rate to 5.4 per cent from 4.5 per cent in April, according to the Financial Times house price index."

FT.com: FTSE 100 in red for 2006 as sentiment sours

London equities set to finish sharply lower on Thursday as Wall Street indices slump due to widespread concern about global inflationary pressure. The FTSE 100 looks set to finish the day down 2.5% which takes it into the red for 06.

Posted by denzil @ 04:57 PM 9 Comments

Bloomberg: ECB raises interest rate by 0.25%

The European Central Bank increased its benchmark interest rate for the third time in six months to restrain inflation as economic growth accelerates.

Bank of England: Bank of England Maintains Interest Rates at 4.5%

As predicted the UK has kept UK interest rates on hold for the tenth month in a row.

Posted by webmaster @ 12:02 PM 18 Comments

BBC News Online: Ming's 100 days policy blitz

Lib Dem leader Sir Menzies Campbell outlines his parties policy blitz. 'he is proposing a headline grabbing 2p cut in the basic rate, funded by big green taxes and a £13 billion take from the most wealthy second home and share owners - all combined with a tight rein on spending.'

BBC News: Surprise dip in UK manufacturing

The UK's manufacturing sector has seen its worst fall in output for more than six months, official figures show. A decline in production of paper and electrical goods contributed to April's manufacturing output slipping by 0.2%.

TimesOnline: Bank irked as Brown takes his time over new MPC member

Growing concern and irritation at the BoE over the prolonged delay taken by the chancellor in appointing new member for the BoE MPC.

TimesOnline: Growth worries send FTSE tumbling

The FTSE 100 index shed as much as 129.7 to 5575.8 after about an hour.

SKY News: London Shares Bloodbath

Around £30bn has been wiped off the value of shares in London as the market was rocked by falling commodity prices and fears over rising interest rates.

BBC News: May sees house price growth slow

FT.com: House price rises at 14-month high

This is Money: House prices 'will rise 7%'

House prices are expected to rise more than three times faster than predicted this year because of fierce competition among buyers.

Scotsman: Scots 'paying excessive prices for substandard housing'

House-buyers in Scotland are being "ripped off" by property developers whose building standards lag years behind those of England and other parts of Europe, industry experts warned yesterday.

Scotsman: I want to sell, but why can't I talk about money?

I wrote a few weeks ago that a good estate agent should contact all viewers to ask for their comments soon after they have been out to a property.

BBC News: Japanese shares hit six-month low

Japanese shares plummeted to a fresh six-month low on Thursday as ongoing fears about interest rate rises in the US continue to hit the global markets.

BBC News: Bank set to keep UK rates steady

UK interest rates are set to remain at 4.5% for the tenth month in a row after the Bank of England's latest meeting.

Posted by webmaster @ 07:59 AM 7 Comments

Firstrung: Cheaper mortgage possible despite adverse credit history

An Increasing number of applicants are accepting mortgages for people with adverse credit history when they could probably qualify for cheaper deals, a financial website said today.

Firstrung: Mortgage providers won't help us in financial difficulties - Moneyfacts research

62 per cent of consumers do not think their mortgage provider would help them if they were in financial difficulty, moneyfacts.co.uk research has revealed

Yahoo - UK & Ireland: Article

Greenspan tells congress that the current US reliance on oil "has handcuffed our foreign policy and weakened us economically"

FT.com: Dollar buoyed by rate hike talk

Brokers have factored in an 80% chance of a 17th consecutive monthly rise during this months meeting on June 29th. Clifford Bennett, chief strategist at FxMax said, "If the Fed does not now hike after sending the market all these hawkish hints, they will look like idiots and lose all respect from financial markets. If they do hike, they will damage the US economy and send waves around the globe."

Firstrung: The real nail-biting drama this summer will be played out on the world stock markets

Moneyweek's John Stepek points out the other dramatic events that could unfold this summer...

Sky News: House Prices Set To Leap

House prices look likely to increase at more than three times the rate previously predicted this year, an industry body has claimed.

Posted by kc @ 01:43 PM 10 Comments

dailyreckoning.co.uk: The end of liquidity

We recall a realtor quoted in the NY TIMES only a year ago: "South Florida," he said, "is working off of a totally new economic model than any of us have ever experienced in the past." Explaining how limited supply and unlimited demand would create a situation in which prices rose forever. Many people thought so. But now it looks as though this economic model was not so different after all.

CNN.com: Australia leaves rates on hold

Australia's central bank kept interest rates unchanged at 5.75 percent as expected on Wednesday, a month after it raised rates in a pre-emptive strike against inflation.

Firstrung: Consumer confidence pinned on world cup success

So the performance of the UK plc economy is all pinned (excuse the pun) on the world cup according to the Nationwide..you couldn`t invent it...

Firstrung: Repossessions have risen to their highest level in 14 years

Whilst not at the horrendous levels of the early nineties this spike in repossessions, given how compliant most lenders now are, should be of grave concern. However, as news it appears to be conveniently airburshed from mainstream sources...

Posted by Converted Lurker @ 11:06 AM 7 Comments

BBC: Markets beset by inflation fears

Investors are concerned that moves to control inflation in the US could stifle economic growth in the world's largest economy. "As long as such fears are out there, the local market will be pressured by sustained selling from large overseas investors, such as hedge funds, as they accelerate capital repatriation back to their home countries", said Shigeo Kikuchi, an analyst at Takagi Securities.

TimesOnline: Into the frying pan or the fire – which way should the Fed jump?

Interesting article that indicates a period of stagflation could be the direction the US economy is heading.

Posted by denzil @ 09:47 AM 8 Comments

Forbes: Recession Dead Ahead

Today’s US economy is on a collision course with a recession. And the most probable starting point is the fourth quarter of this year or early 2007.

Ananova: Consumers Upbeat But Have Job Fears

Consumers are feeling more bullish about the state of the economy but rising unemployment remains a major concern, research has shown.

Firstrung: London house prices now exceed 250K- Haart estate agent report

How can supposed levels of first time buyers be maintained at these prices? The latest data from haart estate agents reveals that the average London house price is now over a quarter of million pounds, as it rises for the eighth consecutive month....

Firstrung: First time buyers will need to save £300 a month for 4 years to afford average deposit

Does the term saving even exist as a concept amongst most under the age of 35?

Posted by Converted Lurker @ 10:51 AM 25 Comments

MyFinances.co.uk: Brits hiding debts from partners

Seven out of ten people with serious debt problems hide this fact from their husbands or wives. Instead of telling their partners, Britons are often more likely to confess to family and friends, new research from leading debt adviser Debt Free Direct reveals.

TimesOnline: US shares dive as Fed chief warns on inflation

The US Federal Reserve chairman said that recent increases in US inflation were “unwelcome developments” and insisted that the Fed would remain “vigilant” to ensure the increases were not sustained. The third-biggest one-day fall in share prices this year took the Dow to a three-month low.

TimesOnline: FTSE tumbles as US sends rate alert

The message from Wall Street overnight that interest rates are heading higher sent the FTSE tumbling this morning.

Telegraph: Gazumping returns with shortage of property

Gazumping, the curse of the hopeful home buyer, is back with a vengeance, according to research on the property market in England and Wales.

Forbes: Implosion

Forbes's Gary Shilling gives us the latest on the unfolding drama that is the US housing market - read now what the BBC will be reporting in 3 months time.

The Guardian: How to sell a lifestyle

An amusing piece looking at how property developers aim to appeal to young buyers who want a combination of heritage and modernity.

ABN Amro: Fundamentals intact after speculators exit

“Markets are scared that if interest rates rise too strongly, the US housing market will collapse and global growth will disintegrate. As a result, risk aversion has increased, prompting a mass exit. While we believe global growth will slow, a meltdown is highly unlikely.” (article from 31 May)

Sky News: Service Sector Expanding

The UK service sector continued to grow in May after a survey showed employment rising at its sharpest level in 18 months. Strong demand led to increases in volumes and new orders, according to the Chartered Institute of Purchasing & Supply. It said the hotels and restaurants and financial services sectors performed particularly well.

Firstrung: First time buyers, interest increasing - Alliance and Leicester..

A&L issue this type of release each quarter, this one is quite remarkable...

Guardian: Prosecute bad lenders over debt suicides, says whistleblower

Further evidence that lending in Britain is out of control. Calls are coming from all quarters to restrict lending, although it's all a bit late for that!

Posted by inbreda @ 09:13 AM 8 Comments

The Times: ECB may raise interest rates to 3%

THE European Central Bank (ECB) could raise interest rates by more than expected this week as it seeks to respond to the threat of rising inflation and to strong growth prospects in the eurozone. After sustained rises in commodity prices, some economists believe that the ECB will raise its rates by a half-point to 3 per cent. The general view has been that rates will rise by a more modest quarter-point. The Bank of England, whose Monetary Policy Committee (MPC) also meets this week, looks set to keep UK rates unchanged.

icStaines: 'Fresh confidence' among homebuyers

The number of people planning to move home has doubled since the beginning of the year as confidence in the property market remains strong, research shows. Around 15% of people now claim they plan to buy a new house before next winter, compared with just 7% at the beginning of the year, according to Alliance & Leicester.

Posted by jason @ 07:26 AM 13 Comments

Guardian: British manufacturers start recruiting as output reaches highest since mid-1990s

Britain's manufacturing industry is enjoying its best performance for a decade, supported by strengthening export demand as the global economy picks up speed, according to an influential survey of the sector published today. Output is at its highest since the mid-1990s, and companies are expecting the strong demand to continue, with confidence about the outlook for the next three months at its best in eight years.

Posted by jason @ 07:24 AM 7 Comments

Guardian: Brown not crediting Bank with his respect

MPC needs full complement of members - and an open appointments procedure. Labour considers independence for the Bank of England the jewel in its crown. Ask any cabinet minister to list the achievements of the Blair government since 1997 and the decision to hand over operational control of monetary policy to the Old Lady will be right up there. It's what Sgt Pepper is to those lists of the top 100 albums: the yardstick by which everything else is measured.

BBC News: Inflation 'a blot' on UK economy

The threat of rising inflation is "a blot" on prospects for the UK economy, an influential study has argued. Accountants BDO Stoy Hayward said the strong housing market and an upturn in consumer spending would act as major drivers of future economic growth.

Firstrung: First time buyers - the week in focus

The weekly summary of key news items affecting the first time buyer...

Firstrung: Mortgage lending, the UK continues its gorge

A new report from Datamonitor has confirmed that the UK has the most demand for mortgage lending, with gross advances reaching a stunning £286,528 million in the year. A third of all gross advances in the European Union residential mortgage market took place in the UK last year.

TimesOnline: The Market

General Weekly round-up of the "Market" from the Sunday Times. Rental yields have plummeted due to increases in capital costs. Can rents rise to make BTL a viable option in Central London?

TimesOnline: Investors dump shares to buy property

The "Times" journalist and BTL evangelist Clare Francis gets the front page of the money section of the Sunday Times with this particularly piece of one-side journalism. Her sources for this piece are Paragon specialist mortgages, The association of letting agents, UCB Home loans (The BTL arm of Nationwide), Landlord Mortages. Oh, BTW a broker and an IFA get a sentence each at the end of the piece.

BBC News: Britain's streets of debt: Whistleblower

The BBC begins a 5 part series on debt in Britain with an expose of how the banking industry targets customers and pushes borrowing.

Firstrung: Rightmove up their house price inflation target to 8%

In spite of the consensus of a levelling off in demand for the second half of the year, Rightmove is increasing its 2006 forecast from 5% to 8%. This would give an average national asking price of £212,025, representing a rise of £15,706 on the year.

Firstrung: Estate agent business to go into deep decline as buyers and sellers deal direct over the internet?

With over 1 million of the 1.4 million homes sold in the UK each year being viewed online, how long before the estate agency business goes into deep decline as buyers and sellers deal direct over the internet?

Firstrung: Rightmove up their house price inflation target to 8%

Rightmove is increasing its 2006 forecast from 5% to 8%. This would give an average national asking price of £212,025, representing a rise of £15,706 on the year.

Firstrung: Estate agent business to go into deep decline as buyers and sellers deal direct over the internet?

With over 1 million of the 1.4 million homes sold in the UK each year being viewed online, how long before the estate agency business goes into deep decline as buyers and sellers deal direct over the internet? Very soon according to IMRG...

in2perspective: 'The cost of housing will continue to rise'

Despite industry expectations of a levelling off of demand in the second half of the year, Rightmove has increased its forecast for UK house price growth this year from 5% to 8%.

The Times: Are you more than a little overstretched?

TALK of rising interest rates ought to be setting off alarm bells across the UK right now. For while most of us enjoy greater financial security than ever before, a growing number are being stretched to breaking point.

Independent: Sardinia targets yachts in battle against rich tourists

The beginning of the article is just about an outrageous harbour fee, designed to keep the rich away, but then notice the bit about the governers' 20% stampduty on second homes in the area and his other measures to protect the locals.

Telegraph.co.uk: Outgoing euro chief warns of 'tensions'

Dr Otmar Issing said the ECB's biggest mistake so far has been to cling to lax monetary policy too long, allowing excess liquidity to build up. The M3 money supply has grown 8.8pc in the year to April, accelerating to a 10.5pc annual rate over the past three months. "This high liquidity contains the potential for inflation. It has also led to a hunt for higher yields. Risk premiums have been so compressed that a lot of investors are no longer aware to the real risk they are taking on," he said. Unlike the US Federal Reserve, which abolished M3 data this year and takes a benign view of asset bubbles, the ECB views any surge in the money supply as a portent of trouble.

Times Online: ECB warns on hedge fund risk

HEDGE funds are creating a “major risk” to global financial stability, although there may be little that can be done to tackle the problem, the European Central Bank suggested yesterday. In one of the starkest warnings yet from an official institution over the role of the burgeoning but secretive industry, the ECB sounded a note of alarm over the possible repercussions from any collapse of a hedge fund, or group of funds. In its twice-yearly Financial Stability Review, the Frankfurt-based central bank also raised serious concerns over many hedge funds’ growing use of “increasingly similar” trading strategies. It argued that this trend could lead to worldwide liquidity problems if a financial or economic shock led funds simultaneously to attempt to alter their trading positions. The ECB suggested that the herd instinct among hedge funds posed “a major risk for financial stability, which warrants close monitoring, despite the essential lack of any possible remedies”.

Firstrung: First time buyers market share now shrinks to 7.9%

7.9% is the new nadir, however, according to Firstrung stats., those able to buy are at 25-30%. Is the first time buyer therefore just not sailing on the ship of fools and waiting patiently for the unholy mess to finally unwind?

Motley Fool: Understanding House Price Indices

Every few days, we're bombarded with new data on the housing market, saying that the average price of a three-bedroomed house in Dorset has risen by 2% or something. The government got so concerned that this might be creating distortions in the housing market they've added their own index, which arguably has just increased the confusion!

Daily Mail: Gordon Brown and the great tax robbery

Tomorrow, Britain's working men and women, who toil for the longest hours in Europe, can finally heave a sigh of relief. For it marks the milestone in the year when we stop working for the taxman and start earning money for ourselves.

Interactive Investor: Inflation

They style themselves as men and women of the people, but the current crop of senior politicians does not live in the same world as the rest of us. Here is just one example: the top tier of ministers each has a grace and favour home and chauffeur-driven car, the expenses of which are paid for by the taxpayer. No worries about road tax, the price of petrol, house insurance or council tax here.

Firstrung: The Hip report - an invaluable resource

As first time buyers, if you want to avoid the petty political point scoring instigated by the misguided opponents of HIPS, then Firstrung recommends book-marking The Hip Report for future reference.

Guardian: Perils of Buying Abroad

A Somerset couple's traumatic experience with their dream house on Crete is a warning to anyone buying property abroad, writes Jeremy Davies

Wales4Sale.com: A Modest Proposal

Outside settlers threaten the Welsh language and culture as locals are displaced due to high property prices.

Independent: Stagflation fears stalk UK industry

The strong rebound in growth at Britain's factories hit a bump last month as output and new orders both slowed, a snapshot survey showed yesterday. The headline activity index produced by the Chartered Institute of Purchasing and Supply (Cips) fell in May from April's 117-month high. It eased to 53.2 from 54.0 on a scale where 50 separates expansion from contraction, only its second fall this year.

CreditAction: Debt Facts and Figures - Compiled 1st June 2006

At the end of April 2006 the total UK personal debt was £1,191bn. The growth rate remains strong at 10.2% for the previous 12 months which equates to an increase of £100bn. Total secured lending on homes in April 2006 was £999.2bn. This has increased 10.8% in the last 12 months.

Credit Action: Debt Facts and Figures - Compiled 1st June 2006

Total mortgage borrowing in the UK will have passed the £1 trillion (£1,000 billion) in May 2006, according to the Council of Mortgage Lenders. At the end of April 2006 the total UK personal debt was £1,191bn. The growth rate remains strong at 10.2% for the previous 12 months which equates to an increase of £100bn. Total secured lending on homes in April 2006 was £999.2bn. This has increased 10.8% in the last 12 months. Total consumer credit lending to individuals in April 2006 was £191.5bn. This has increased 7.3% in the last 12 months. Total lending in April 2006 grew by £9.3bn. Secured lending grew by £8.5bn in the month. Consumer credit lending grew by £0.8bn in the month. Average household debt in the UK is approximately £7,754 (excluding mortgages) and £48,209 including mortgages. Average owed by every UK adult is approximately £25,545 (including mortgages). This grew by ~ £200 last month. Average consumer borrowing via credit cards, motor and retail finance deals, overdrafts and unsecured personal loans has risen to £4,109 per average UK adult at the end of April 2006. This has grown 52% in 5 years. Britain's personal debt is increasing by ~ £1 million every four minutes.

Financial Times: House price revival may be short-lived

Recent reports suggest that recent house price rises have run out of steam and that further falls are just around the corner.

Sky News: Prices Take A Hike

British manufacturers raised their prices last month after being hit by the biggest increase in raw material prices for 16 months. The Chartered Institute of Purchasing and Supply said input prices rose rapidly in May on the back of the higher cost of energy and oil.

TimesOnline: Markets tense as Fed hints at a rate rise

The Federal Reserve made markets jittery with talk that June may see yet another increase in rates and they even considered a .5% increase in May.

The Independent Online: Property mini-boom may be petering out

This article reports a mixed batch of data from a number of sources including mortgage approvals, average property prices, interest rates outlook, stock prices, consumer confidence, retail sales volumes. Most data would support the idea of declining economic conditions but one, (retail sales), supports continuing or improving conditions.

Posted by talking rot @ 12:10 PM 6 Comments

Guardian: Tax credit reform sought as errors cause new hardship

2 million FAMILIES required to repay an average of a grand each. And this at a time when interest rates will be rising and mortgage payments becoming harder to cover. Fuel bills rising. And so many of these families will be so stretched to the credit limit already! I sense a surge in IVAs.

Firstrung: Sub prime mortgages more prevalent amongst minorities in the US

Think it doesn't happen in the UK? Don`t be so sure...

Telegraph: 'World Cup effect' fails to save employment on the high street

High street stores have laid off a record number of staff, amid fears that the much-vaunted "World Cup effect" may fail to bounce them back into the black.

Money Week: What's propping up UK property markets?

There is an unusual phenomenon of price rises without increased demand from occupiers, albeit mostly in London. This article examines who is propping up the residential and commercial property markets.

Posted by talking rot @ 08:59 AM 7 Comments

Bloomberg: ECB Gets Money-Supply Hint to Double Up on Rates

The European Central Bank may break with recent tradition by raising its key lending rate by half a point next week, eschewing the quarter-point moves that have become customary among the world's central banks.