December 2006 Archive
Saturday, December 30, 2006 
Yet More FTB Bad News
Times Online: House prices drive first-time buyers down to a new low
FTBrs dropped to lowest level for 26 years. Buckinghamshire, FTBs now need nearly 17 X £44K income for ave. £725K property, the Halifax said.
FTBs need £150K for 1st rung
Easier Property: Average price paid by a first time buyer now above £150K
Only 10% of 22-29 year olds, with average full-time earnings of £33,202, had comparable income levels to first-time buyers in 2006.
Edmund Conway is downbeat on HPI
The Telegraph: The end is nigh …
Just when you thought house prices couldn't go any higher, they don't. At least that's the bold prediction of our Economics Editor, Edmund Conway There's no easy way of saying this, so here goes: 2007 could be the year the housing market finally rediscovers gravity, and comes down to earth with a crunch.
Where now for buy to let?
Firstrung: Rogue landlords to be forced out under new legislation
Tenancy Deposit Protection will help force out the minority of rogue operators who wrongly withhold tenants' deposits....
The Telegraph joins in, is this the start of the "bad HPI" media coverage
Telegraph: Homes cost six times wages
The true size of the housing market boom was demonstrated yesterday by figures that showed people are borrowing an average of almost 6.5 times their salary to buy a home. We already know this, but do the general public know ?
National debt is three times higher than Government claims
Daily Maul (sorry, Mail): National debt is three times higher than Government claims
A little out of date but we seemed to have missed this one from a month ago. It was also reported yesterday by enuii as a reference in the "Trumpet" artlcle.
Friday, December 29, 2006
Cassandras keep shtum on property risks
The Times: Cassandras keep shtum on property risks
Article on how those predicting a property crash are keeping quiet for fear of being accused of 'crying wolf'.
House prices on the rise again
The Times: House prices on the rise again
The print version has a graph showing the ONS/Datastream/Nationwide data for RPI and percentage change in house prices since 1953. It is interesting because it shows a) RPI always peaks after a large % change inhouse prices b) It highlights the cyclical nature of the housing market with huge peaks in 1970, 1978, 1989 and 2002. Each time (with the exception of 2002) there is a period of near zero growth for some time (coupled with high RPI inflation to erode the capital of the debt). In 2002 RPI has been very low. RPI in the 70s was well above 25% illustrating the argument that inflation eroded the capital of the debt of baby boomers in the 70s (wages are set by RPI mind you I don't think CPI existed in the 70s). The text is the usual bumf. It was the graph that interested me. I would scan it and post it but I'm at home at parents for holidays and don't have my scanner.
Futures trading shows rate rise expectation
Bloomberg: U.K. Borrowing Increases as Homeowners Shrug Off Rate Rises
U.K. banks granted more loans to buy houses and Britons are borrowing more against the value of their property, adding pressure on the Bank of England to extend a series of interest rate increases into next year.
First time buyers nearly extinct
Firstrung: Average price paid by a first time buyer now above £150,000
New Halifax research shows that the average house price paid by a first time buyer (FTB) pushed through the £150,000 barrier for the first time in 2006. The average price increased by 11% in 2006 to £151,565 from £137,122 in 2005. Over the past five years the average house price paid by a FTB has almost doubled, rising by 95% from £77,914 in 2001.
Renters Gloat Over the Housing Slump
yahoo: The Wall Street Journal Online
Can't wait for the gloating to start in the UK
Von Mises vs Bernanke
Bull! Not bull: The Specter of Deflation
A specter is haunting the US economy - the specter of deflation. The Fed and the Treasury - the central powers of Capitalism itself - have entered a holy alliance to exorcise this specter. The big question is, will they be able to do it?
2007 'Debt Tipping Point' Warning
BBC News: New year could see debt 'tipping point'
Further scaremongering or an 'AWOOGA' warning about the future?
Could it go wrong in 2007?
BBC News: New year could see debt 'tipping point'
A fairly balanced BBC article regarding the chance of a credit meltdown in 2007
BBC finally running some articles of a bearish nature
BBC: New year could see debt 'tipping point'
Surprised no one has picked up on this yet.
Economy on the brink of insolvency?
Daily Mail: 'Buy now, pay later' could bring the country to the brink of insolvency
The biggest debt burden of any major economy will push 150,000 Britons into insolvency next year, according to alarming new research. Families have racked up a record £1.3 trillion of debts, fuelled by easy availability of credit, but they face a painful squeeze as borrowing costs mount.
Thursday, December 28, 2006
Davis places bets both ways
BBC: Interesting times
This is the time of year when otherwise decent journalists write articles setting out their predictions for the twelve months coming...
True Scale of Britains Hidden Debt
The Trumpet: Unveiling Britain’s True National Debt
Is this another nail in the house price coffin. A recent study claims Britain’s national debt is three times higher than official government reports. If this is correct, Britain could be the most indebted nation in Europe. Yet, a UK Treasury spokesman claims the calculations are “spurious” because the government does not legally have to account for public sector pensions or liabilities of other publicly owned entities. Has the UK government been covering up its true spending or not?
Women feel economic burden
This is London: Mothers cut short their career breaks
Statistics reveal how much economoic pressure is being placed on UK families by high housing costs, taxation and living expenses. There is more than just a housing bubble operating as factors in the UK economy, which bubble will pop first?
UK tax burden to rise for next 50 years
The Scotsman: UK faces rising tax for next 50 years
UK Treasury projections are that the tax burden on the UK population will rise continually as a percentage of income for the next 50 years. Couple this with people having to work longer both in years and hours per week, save for their own pensions and pay more for somewhere to live and something has to give.
Wednesday, December 27, 2006
crash of july2007
old moores almanac: slightlylostintheworld.
old moores almanac is predicting a house price crash in july.07
That US deficit shrink won't last long...
Bloomberg: Dollar Drops; U.A.E. Says Selling U.S. Currency, Buying Euros
UAE lines up against the dollar; evidence of reserve currency diversification, might set a precident.
What are the chances of a slowdown in 2007?
The Times: They promised a slowdown, but house prices climb
The Times looks at the prospects for 2007. Is there anything in the recent sets of data to support those longing for a crash? Or are prices set to contiune rising on the same trajectory as 2006?
This is one for the bulls that say it is still affordable for FTBs
Daily Mail: Number of first-time buyers hits record low
The number of first-time buyers has fallen to its lowest level since records began. With the average house price approaching £200,000, young people accounted for just 15 per cent of all purchases in the past year, research shows.
2007: the year of more house price rises. Or, finally, house price falls. You work it out.
BBC Lies: UK home price rises 'to continue'
BBC using numbers to try to confuse people. Can someone work out exactly what the 1500 people surveyed said? 55% rise, 45% fall?
BBC price rise bias 'to continue'
BBC News: UK home price rises 'to continue'
The quoted survey suggests that "one out of every three people expects UK house prices to increase by more than 6% in 2007". It goes on to say 55% of people think prices will rise (which leaves 45% for flat or falling prices, including "10% of people [who] predicted a drop in prices of more than 20% before the end of 2007). How they can justify the title of the article from the content I don't understand.
Tuesday, December 26, 2006
Recession on the way for 2007
Asia Times: Global economy faces a dangerous year
Rising inflation and falling home prices are likely to push the US economy into recession by the second half of 2007. Gathering economic weakness, combined with negative real yields on US Treasury securities and growing political pressure to weaken the dollar will lead to significant dollar depreciation against most currencies............
The bear peeps out of his cave...
Telegraph: Business comment
Roger Bootle, still making sense, but has given up making predictions! (Thanks to Fatso on the forum for spotting this) Merry Christmas to all fellow HPC bloggers - here's hoping for a Happy New Year!
Sunday, December 24, 2006
Police warn of failing Economy
BBC News Online: Ministers 'braced for crime rise'
The Police have warned of failing economy, criminal activity to rise as economy dips in New Year warn Police in 'Secret' leaked memo. A straight warning from those who actually know what is going on in the UK's streets and neighbourhoods.
Aberdeen House Prices increase by 27% on the year
Press and Journal: CITY'S SOARAWAY PRICES LEAD PROPERTY MARKET
Householders in Aberdeen have seen the value of their properties soar by 27% during the last 12 months, the biggest rise anywhere in Scotland. The average price of a Granite City property is now £171,767 - nearly £45,000 above the Scottish average, according to an authoritative study published today.
Economic recession around the corner?
Sky News: Report's warning on crime
A leaked Downing St memo reveals the Government is aware of a looming economic slowdown and it's consequent social effects. Enjoy Christmas as it looks like 2007 is going to be a difficult year for many. "A slowdown in the economy is threatening to reverse recent falls in crime levels...."
Xmas message from Firstrung
Firstrung: A mortgage is for 25 years, not just Xmas - Firstrung newsletter
Well this is our last communication of the year, we'll keep it brief! Firstly thanks for all the support, the readership of the site has grown exponentially over the past year. Similarly the reputation of the site and that of the skeleton team that 'power the proposition' has grown leaps and bounds during 2006.
Weekly round up of relevant news
Firstrung: Firstrung - first time buyers - the week in focus
Hats off to Inside Housing for publishing this information to a wider audience and confirming the suspicion some market commentators have held for some time - buy to let investors are in it for capital growth only and are largely ignorant of investment yield
Friday, December 22, 2006
Consumers should review their debt situation in the new year, says John Charcol
Free Help Advice: Consumers should review their debt situation in the new year, says John Charcol
John Charcol, the UK’s leading independent mortgage adviser, has urged consumers to review their debt situation and set themselves a budget for each month in the new year. The company has advised consumers to move their credit card debts to a lower unsecured rate or gain advice on consolidating with their mortgage.
Housing shortage:Demand for property would rise across UK in 2007
Free Help Advice: Housing shortage:Demand for property would rise across UK in 2007
2007 could be an extremely prosperous year for people living in coastal or university towns, as well as in areas that have up until now been viewed as unfashionable, according to FindaProperty.com, a leading property website in the UK. FindaProperty said that the demand for property in almost all British towns is set to rise next year, regardless of the interest rate hike expected in February.
Britons pay almost a quarter of their wages towards taxes
Free Help Advice: Britons pay almost a quarter of their wages towards taxes
According to the detailed national accounts for the third quarter released yesterday, the tax burden on households in the UK has risen to its highest level since modern records began, while the growth in income has slowed substantially.
More trouble for the dollar?
BBC News: Venezuela mulls euro oil switch
Venezuela has expressed interest in an Iranian move to ask buyers to pay for oil in euros rather than US dollars. The oil-rich nation said it planned to see if a similar scheme could be introduced to its crude exports. Iran, the world's fourth-biggest oil producer, has already asked customers to pay for its oil in euros because of the current weakness of the dollar.......
Gaze into Firstrung's crystal ball...
First Rung: Where are house prices heading in 2007?
Predictions for 2007 from Halifax, Nationwide, Council of Mortgage Lenders (CML), Capital Economics and Royal Institution of Chartered Surveyors (RICS).
Demand for seven figure mortgages increases massively
Guardian: Million pound mortgages all the rage
The record bonuses paid in the city of London this season coupled with high housing demand in London is increasing the number of million pound plus mortgages. Savills Private Finance estimate that of the £8.8bn paid in bonuses, around £5.5bn will be invested into property.
1 in 3 businesses worried about HPC - Lloyds TSB
First Rung: House price crash still a worry for U.K. business confidence - Lloyds TSB
A survey carried out by Lloyds TSB indicates that 1 in 3 businesses are losing confidence in the stability of the economy and worried about a house price crash in 2007.
Growth of economyt - IR rise in New Year inevitable?
Guardian: Further rate rises feared as economy races ahead
Spending in UK economy grew at fastest rate for two years in third quarter, and house prices kept buoyant by city bonuses. Ananlysts predict IR hike in New Year.
Buy to let forecasts
Firstrung: Buy to let preview for 2007 - Mortgages for Business
The buy to let market remained strong throughout 2006 and looking forward to the New Year it is likely to remain strong, according to independent buy to let brokers Mortgages for Business review of the year to come. David Whittaker, Managing Director of Mortgages for Business comments: "The main pressures on the buy to let market in 2007 are likely to be from further interest rate increases and the Government's decisions on whether to finally implement initiatives such as the seller's pack and the tenancy deposit scheme".
Auction advice for FTBs
Firstrung: First time buyer auction advice from property secrets
A 60% year on year growth in property purchases at auctions signals another strong year for auctioneers but Property Secrets CEO Neil Lewis believes that getting the right property at auction is beset by obstacles that for the uninitiated, which will hit them where it hurts most, their back pocket.
BBC list predictions for next year
bbc website: Where are house prices heading in 2007?
The last bear has turned bull. No-one is predicting a fall. Capital Economics predict a rise next year, but "To date they have been about as wide off the mark as is possible. They still believe that property is overvalued and will eventually fall in price."
Tax burden on average wages is now highest on record
TimesOnline: Tax burden on wages climbs to the highest since records
Taxes on incomes rose by 6.7 per cent over the past year, much higher than the 4.6 per cent rise in wages and salaries.
Sudden drop in the savings ratio
The Telegraph: Living costs outpace earnings
Cash-strapped households are having to dig into their savings as the pressure of higher bills, higher taxes and lower wage growth slashes the amount of money left in their pockets, authoritative figures show
Thursday, December 21, 2006
Public finances can't withstand shock
FT.com: IMF warns on threat to public finances
Brown's been overspending. Naughty boy! IMF was reported by FT saying that if there's any downturn, taxes will have to go up sharply to pay for it all! What's it about a rock and a hard place?
IMF warn of threat to public finances
Financial Times: IMF warns on threat to public finances
Hmm....seems like Brown's spent thrift ways could come back to roost. Says finances will not be able to hold up if there's a global slow down. Not good.
US Pessimists say house price crash inevitable
TimesOnline: US pessimists say house price crash is inevitable
Peter Schiff, chief executive of Euro Pacific Capital argues that house prices will experience an unprecedented collapse, falling by as much as 70 per cent in some areas.
US housing market sees further drops
BBC "News": Slow house market hits US growth
The US economy has grown more slowly than first forecast in the three months to the end of September as a weaker housing market hit consumer confidence. Favourite quote from a housing market bull "These are old numbers, that's the best way of looking at it,". The numbers were released today by the Dept of Commerce.
Strong retail figures from CBI
The Guardian: City expects rate increase after retail sales hit two-year high and mortgage demand rises
Talk of a poor Christmas for retail may prove to be confounded, as CBI data shows that many retailers are experiencing their best Christmas for two years. This data, coupled with high mortgage lending is leading city analysts to predict an interest rate hike in the New Year.
Economic growth accelerates in final quarter of 2006
BBC News: UK economic growth strengthening
The GDP of the United Kingdom rose 0.7% in the past three months, according to the Office of National Statistics. This makes for year on year growth of 2.9%, an upward revision and on course to meet the Chancellor's target for the year.
The chances of a New Year IR rise
The Telegraph: Mortgages, house prices and retail all strong… can Bank resist higher rates?
House prices and mortgage lending are at the highest levels ever, according to data from the CML and Royal Institute of Chartered Surveyors. Many analysts are predicting the MPC will be unable to resist increasing interest rates in the New Year if Christmas retail figures are strong.
Persimmon confident prices will continue to rise in 2007.
Reuters UK: Persimmon sees house prices rising
Persimmon, the country's largest housebuilder, announced its 2006 profits will be in line with expectations, and it is bullish about house price increases into 2007.
US housing downturn hits profits at Wimpey
Times Online: Wimpey backs off from US market after hit on profits
George Wimpey, the housebuilding firm, gave warning yesterday that full-year profits could take a hit after a £40 million write-down from a review of its land contracts in the United States.
US House Crash 'Inevitable'
Times Online: US pessimists say house price crash is inevitable
Just a few more pieces of bad news about housing could have a significant impact on the American pysche.
Debt woes: Driving home for Christmas: The Matrix has you!
Free Help Advice: Debt woes: Driving home for Christmas: The Matrix has you!
Just 47% of UK employees said they were either happy or very happy with their current position, this means a whopping 53% of UK employees are unhappy in their jobs. So why do they carry on slaving away? The answer is simple, huge debts and mortgages to service. Imagine getting up every morning (Groundhog Day) knowing you have to go to a job you hate because you need the money to service your debts.
House market 'disaster' warning
Daily Mail: House market 'disaster' warning
Lombard spokesman Diana Choyleva said the housing market 'continues to power ahead' and is 'alive and well.' But she warned there is a danger that the bubble will burst in 2008 if the rate rise does not slow down.
US housing crash unavoidable
Times: US pessimists say house price crash is inevitable
US pessimists say house price crash is inevitable
Wednesday, December 20, 2006
Euro rises on expectations that the ECB will raise IRs
FT: Euro rallies on inflation concerns
European Central Bank President Jean-Claude Trichet warned the European Parliament of the risks of inflaiton and said it was likely there would be further IR rises in the New Year. This helped nudge the Euro to an all time high against the yen.
MPC December minutes released
Reuters UK: Bank votes for steady rates
The Bank of England Monetary Policy Committee were unanimous in their December 7th decision to hold interest rates at 5.0%. However, there were differences in their attitudes to inflation and trends for 2007.
House prices increase for 13th month in a row
Daily Express: House prices soar for 13th month running
City bonuses and a robust economy have helped keep demand for housing across the UK high, leading to price increases for the 13th consecutive month, the Daily Express report.
15% house price increases in 2007?
BBC News: House prices 'to be 15% higher'
Lombard Street Research have predicted that there will be no slow down in house price growth in 2007. After correctly predicting a 10% increase in 2006, they estimate 15% for 2007.
£33.1b lent in mortgages in November
BBC News: Mortgage lending hits new record
Data from the Council of Mortgage Lenders shows that a new record amount of mortgage lending took place in November, despite the IR rises in October. This is a 19% increase compared to last November's figures.
FTBs need mortgages 14% greater than last year
Firstrung: First time buyer mortgage needs up 14.05% percent on a year ago
Over the 12 months to November 2006, the average first-time buyer property value searched against on Moneyextra.com's mortgage comparison tool rose by 14.05 per cent to £182,113 - that's more than twice the rate of property price inflation across the whole housing market. It compares with a rise of just 6.27 per cent to an average £268,201 for those looking to move to a new home (which is actually down by a marginal £307 on October 2006).
Wimpey's US crisis.
FT: Wimpey to write-down US assets
Current trading conditions in the US were described as “very poor”. Wimpey’s order book value currently stands at some $198m, a 68 per cent drop on last year. In October the company had said the value of the order book was down 35 per cent. Prices and margins are well under last year’s levels. Completions are down 12 per cent and second-half cancellations are 50 per cent. Furthermore, the outlook for 2007 is poor with a further “material” drop in sales values and volumes forecast.
How to buy a house below market value?
Charles Hugh Smith: How to Buy a $450K Home for $750K
Interesting article listing failures in US economical policy. How much of this applies here?
Tuesday, December 19, 2006
US Producer price index rises 2% in a month
BBC News: US sees jump in producer prices
US wholesale inflation registered its biggest increase in three decades in November, prompted by higher gasoline prices, official figures show.
Japanese IR remains at 0.25%
inthenews.co.uk: Cautious Japanese hold interest rates
The Bank of Japan has opted to keep interest rates in the country at 0.25 per cent in a widely-anticipated move.
Britons are switching credit cards to save money!
Free Help Advice: Britons are switching credit cards to save money!
According to a study carried out by MoneyExpert.com, nearly 25 per cent of credit card holders in the UK have changed their provider in the last year, in an attempt to get a better deal, transferring an average balance of almost £764. The study showed that many people in thye UK are continuing to switch credit cards to cut costs, in spite of the decline in the availability of zero per cent interest deals.
US Inflation NOT under control
BBC: US sees surge in producer prices
The producer price index, which measure the cost of goods from US factories, farms and refineries, rose 2% last month, well above forecasts. The US Labour Department figures saw the core index - which exclude volatile food prices and energy - rise 1.3%. November's increase challenges the notion that inflation is under control.
Property agents expect house prices to carry on rising as demand outstrips supply
Free Help Advice: Property agents expect house prices to carry on rising as demand outstrips supply
A survey published today, showed that estate agents in all regions across the UK expect house prices to carry on rising well into the new year, as demand continue’s to outstrip supply. The Royal Institution of Chartered Surveyors (Rics) has said that a fresh fall in properties for sale has combined with strong interest from potential buyers to increase the imbalance between demand and supply.
RICS - house price inflation grinds to a halt in November
Firstrung: House price inflation stalls in November but housing market refuses to find reverse gear
House prices inflation reached a plateau in November but market conditions remain strong, says RICS's UK housing market survey published today, (19 December 2006). In November, 47.4% more Chartered Surveyors reported a rise than a fall in house prices, down from 47.7% in October, but still more than double the long run average of 21%.
National housing federation comments on shared ownership
Firstrung: Shared equity not the only answer to housing crisis - National Housing Federation
Responding to Chancellor Gordon Brown's Pre-Budget Report, David Orr, chief executive, National Housing Federation, said on new housing and shared equity schemes: "The Chancellor has signalled his intention to increase the supply of much needed affordable housing. Now he must act. "With 1.5 million people on housing waiting lists, the Government must increase investment in affordable rented homes as well as shared equity schemes. "Shared equity schemes alone will not end the housing misery of millions of people on moderate and low incomes. "The National Housing Federation is calling for 150,000 new affordable rented homes and 60,000 new low cost ownership homes in the Comprehensive Spending Review 2007."
Govt interfering in interest rate decisions
IFA online: Treasury's 'over-optimistic' forecasts hinder MPC
The House of Lords have criticised the Treasury for producing “over-optimistic” forecasts which is making it “more difficult than it needs to be” for the Bank of England to set interest rates. A report published today by the House of Lords Economic Affairs Committee, also recommends the Bank of England should carry out more research into the link between rising house prices and consumer spending.
Move to Berlin to get on the ladder
The Sunday Times: Berlin — the next property hotspot
Flats for sale from €50,000 in Berlin
Stamp Inflation 13% in a 13 month period!
BBC News: First class stamps to rise by 2p
First class stamps to rise by 2p to 34p April 2007 up from 30p last March...13.3% increase in just a year. A new pricing structure for letters was introduced in August The price of a first class stamp is to rise by 2p to 34p from next April, the Royal Mail has announced. The cost of a second class stamp will also increase, by 1p to 24p. The hikes come after the price of both stamps rose 2p last April. The cost of larger first class letters of up to 100g will rise 4p to 48p, and bigger second class items by 3p to 40p. I thought general inflation was around 3%?
Monday, December 18, 2006
Snap Election in the offing? Before economy goes South!
BBC: Parties eye 'surprise election'
Labour's rivals are eyeing the possibility of a snap general election, when Tony Blair steps down next year.
Labour Party may abandon Gordon Brown
Daily Mail: No. 10 secret memo: We are seen as a shambles
Just Picked this up off the forum. A secret memo commissioned by Tony Blair indicate that Labour have no chance of winning the next election because the public regard them as a shambles. The confidential document states that, "Labour's standing is so low that the party's only hope of recovering may be to abandon Mr Brown and 'move to a new generation' by picking a much younger new leader.
Dollar ditched by Iran, Good or bad ?
BBC: Dollar dropped in Iran asset move
Iran is to shift its foreign currency reserves from dollars to euros and use the euro for oil deals in response to US-led pressure on its economy.
Telegraph looks at the different measures of inflation
The Telegraph: It's hard to get the measure of inflation
There are as many ways of gauging inflation these days as there are of skinning the proverbial cat. Understanding the speed at which British prices are rising involves wading through an acronym soup of alternative definitions.
A third of store card users are unaware of the high interest rates
Free Help Advice: A third of store card users are unaware of the high interest rates
A survey carried out by The Motley Fool, a commercial website on stocks, investments and personal finance, has found that a third of store card users have no idea of the interest they will be charged, if they fail to clear their balance in full, within the interest-free period.
Chancellor's 'optimism' criticised by Lords
The Independent: Lords pile pressure on Chancellor
The Government's "consistently over-optimistic" growth forecasts may have forced the Bank of England into raising interest rates higher than it would have liked, a powerful House of Lords committee said today.
Consumers fear further interest rate hikes next year!
Free Help Advice: Consumers fear further interest rate hikes next year!
A survey from Lloyds TSB, which covered more than 2,000 consumers, showed that Britons are more concerned about the prospect of interest rate hikes now, than at any time since November 2004. 80% of people surveyed said that they expect interest rates to go up in the next 12 months. Only 4% of the respondents expect the interest rates to fall next year.
Drop in average asking price during the festive season
First Rung: House prices in the doldrums - Rightmove
Rightmove.co.uk has revealed that the average asking price in the U.K. has dropped this month by 0.3% (582 pounds) - but not due to a slowdown, but by sellers putting their properties on the market in the run up to Christmas.
Buy To Speculate
Inside Housing: New builds left empty
Thousands of new homes are being deliberately left empty in England’s cities as investors try to cash in on large-scale house building programmes, an exclusive Inside Housing investigation has revealed.
Sources representing most of the major cities have said that a significant proportion of flats in apartment blocks are snapped up by property speculators – but then left vacant. In some blocks the number of empty homes matched the number actually lived in.
50% of us one wage packet from the gutter..
Firstrung: 14 million workers could be exposed to financial ruin in the event of an accident, illness or unemployment in the New Year
With council tax and utility bills going through the roof, research from Alliance & Leicester Protection has found that over half (51%) of British workers would not be able to manage financially if they were unable to work in the event of an accident, illness or unemployment, equating to 14,137,200 people.
Buy to let or buy to keep empty?
Firstrung: Inside housing reveal the scandal of empty new build property
Hats off to Inside Housing for publishing this information to a wider audience and confirming the suspicion some market commentators have held for some time - buy to let investors are in it for capital growth only and are largely ignorant of investment yield.
Consumers concerned about interest rate rise
BBC: Consumers gripped by rate fears
8 out of 10 people surveyed said they expected interest rates to be higher in twelve months time.
Renting v Buying in NZ
NZ Herald: Renting v Buying in NZ
An excellent summary of a book looking at the NZ housing market which is way worse than the UK. Contains some very obvious points that are rarely made in the pro property NZ media eg you need growth of > 9% to be better off buying v renting, a rate which is of course unsustainable. I will be sending a copy to my friends for christmas.
Sunday, December 17, 2006
Renting providing better value than buying
Firstrung: Young prefer renting upmarket to 'slumming it' as a first-time buyer
Lourna Bourke at Citywire is one of the most consistent and readable market commentators on the plight of first time buyers, here Lourna points out the options for FTBs renting whilst waiting for those opportunities to appear.....
Life in the old dog after the correction..whenever that happens?
Firstrung: Property investment - how to be 'ahead of the curve'
Just because real estate prices seem to have hit a temporary ceiling in many countries around the world, that doesn't mean that profits from property investments are hard to come by. Even during a real estate market slowdown, stagnation or depression profits can be made locally and overseas. This article shows you the top ten tips that real estate investors apply to their property portfolio building strategy to ensure success from their investments.
Saturday, December 16, 2006
Many families have ‘cancelled Christmas’ this year because of financial worries
Free Help Advice: Many families have ‘cancelled Christmas’ this year because of financial worries
According to homeless charity Shelter Cymru, nearly 200 families in Wales will have to spend their Christmas in bed and breakfast accommodation and many more cannot afford to celebrate this festive season, because of their financial woes. Announcing their findings on the 40th anniversary of the broadcast of the homeless drama Cathy Come Home, John Puzey, director of Shelter Cymru, said that homelessness is devastating many families all year round and Christmas is an especially difficult time for them. He said that forty years ago people did not realize how homelessness and bad housing affected lives and today the problem is greater than ever and it can happen to anyone. He added that 35,000 children in Wales are living in unfit housing today and Christmas brings cold, damp misery and suffering to many families without homes.
The social factors boosting the buy to let market
Assetz News: Buy to let boom fuelled by changing lifestyles
As has been widely documented, the liberalisation of landlord laws in the mid-nineties has led to a remarkable boom in the UK buy-to-let market, but new research suggests that the increase in the number of renters may also be due to changing sociological trends.
1 in 4 have no faith in stability of market
First Rung: House price crash predicted by 24% of UK adults within 18 months
The first cracks in Britain's personal debt laden economy were revealed today as debt solutions consultancy, Thomas Charles (www.thomascharles.com) announced a widespread lack of faith in the stability of the UK housing market.
2 x maths teachers + 700 houses = 1 x £240m buy-to-let empire
The Guardian Unlimited: 2 x maths teachers + 700 houses = 1 x £240m buy-to-let empire
House prices in UK will never crash, say Mr and Mrs Wilson of Ashford, Kent. If you think house prices are already outrageous, look away now. According to two former maths teachers from south London, who are Britain's buy-to-let king and queen, the property market will never crash. Husband and wife magnates Fergus and Judith Wilson have just signed a deal to buy their 700th house. If things go to plan, they will become the country's first buy-to-let billionaires. Every week they buy another house - and on one day alone spent £10m buying 40 properties off a distressed developer. by Patrick Collinson The Guardian, Saturday December 16, 2006
Friday, December 15, 2006
Interest only mortgage gets thumbs down from FSA
Firstrung: Interest only mortgages, beware the pitfalls - FSA
Consumers taking out interest-only mortgages generally have a reasonable understanding of the risks involved but a significant minority do not have a robust repayment strategy in place, the Financial Services Authority (FSA) said in a recent report.
New house prices rise 1.9% in 2006
Firstrung: SmartNewHomes.com records a 1.9 percent annual rise in the cost new homes
November has seen the biggest annual price growth in new homes since April, with the average price of a new home up 1.9 per cent on the price recorded at the same time last year. This year's annual price increase has bucked the trend experienced over the last two years, which has seen the average price of a new home fall towards the end of the year, an indication that the new homes market is set for a positive start to 2007. The price of a new home has risen 1.4 per cent over the last month, reinforcing the return of a positive trend for the new homes market at a traditionally quieter time of year. This month's decision by the Bank of England to hold interest rates should ensure a positive start to 2007
That's 4000 job losses just today!
MSN: Thomson owner to axe 2,600 UK jobs
Around 2,600 UK jobs are being axed by the owner of Thomson Holidays as part of a Europe-wide restructuring programme.
High CPI & plus high interest rates = a bad Christmas for retail
The Guardian: Retail sales improve in November but fears persist of a bleak Christmas
Retail sales came in stronger than expected last month despite shops pushing through price rises for many goods, official data showed yesterday, as experts warned of a grim Christmas for the retail sector.
The seasonal adjustment
First Rung: Estate agents witness sharp sales decline of 21 percent in November
Members of the National Association of Estate Agents (NAEA) noted a seasonal downturn in activity in the property market during November, as buyers and sellers concentrate on the festive period, rather than home moves. The number of buyers on estate agents books decreased, as did the number of properties available for sale.
This just in - banks like money!
BBC News: Savers receive 'poor rate deal'
Banks and building societies have failed to pass on to savers about a fifth of recent Bank of England (BoE) interest rate rises, the BBC has found.
Soft landing for US economy?
The Times: US inflation holds stready
Hopes of a soft landing in the US economy were boosted yesterday by a report which revealed that US consumer prices held steady in November.
Nationwide predict housing market to 'remain robust' in 2007
First Rung: Nationwide see no end to first time buyers house price misery in 2007
Nationwide has predicted that house prices will remain firm in 2007, rising between 5-8 per cent during the year.
IVAs will overtake bankruptcies in 2007, warns Experian
Free Help Advice: IVAs will overtake bankruptcies in 2007, warns Experian
Experian, a business information company, has warned that Individual Voluntary Agreements (IVAs) will overtake bankruptcies in UK next year and more than 100,000 people will become officially insolvent. More and more people in the UK are now trying to walk away from their debts by taking out an IVA and latest figures released by the Insolvency Service show that IVAs and bankruptcies are now neck-to-neck as forms of insolvency and their numbers have gone up significantly over the last few years.
Banks use interest rate hikes to improve their bottom line
Free Help Advice: Banks use interest rate hikes to improve their bottom line
Research carried out by personal finance experts at Moneyfacts, in partnership with the BBC News website, has shown that banks are making good use of the recent hikes in interest rates, to push their profit margins up, by increasing the interest rates for millions of borrowers with mortgages, but not doing the same for savers.
Lenders May Soon Tighten Secured Lending - Oh Dear
Money Week: The taxing truth behind the Stern report by John Stepek
Link this article with the one "Times Online: Economics: Shakey Foundations with Joe Bolger". Lenders are tightening unsecured loads as bad debt rises. With IVAs/Bankrupts/Reposessions ticking up, how long will it be before Lenders tighten Mortgage criteria. The Media are doing well today! Hello Glorious Sunshine. Your intellectually rigorous comment please.
The turning tide of the Media
Times Online: Economics: Shaky foundations by Joe Bolger
Joe Bolger of The Times comments that house prices will only remain high as long as Lenders are prepared to stretch affordability. When they stop, so will the market. One for Glorious Sunshine to comment on.
MPC talking (not acting) tough as usual
The times: Rate rise threat grows as public sees higher inflation
A renewed jump in the public’s expectations of future inflation rates to the highest in more than six years yesterday heightened the threat that the Bank of England will be forced to impose further interest rate increases next year.
Mortgaged to the hilt - beware!
Guardian: Centrica to axe 1,300 jobs
British Gas owner Centrica plans to axe 700 back-office roles at its British Gas Residential Energy unit, closing its Stockley Park headquarters in west London and relocating staff to Staines, Surrey. It is also restructuring its British Gas services team with the loss of 340 jobs and streamlining its group corporate structure, leading to a further 270 job cuts.
No crash in sight for Estate Agents
MoneyExtra: House Prices Robust for 2007
The housing crash, predicted around this time of year by some industry doom mongers, will have to be put on hold again. According to the latest report by Nationwide , house prices will increase by 5-8% over the course of 2007. Nationwide's Fionnuala Earley commented "we can expect to see a few months of double-digit annual house price inflation in the first half of the year."
Nationwide forecast for 2007 (talk it up)
Home.co.uk News: Momentum will support house prices until summer
Nationwide said this morning that it expects the rate of house price growth in 2007 to be relatively robust at between 5% and 8%. Momentum gathered in 2006 will flow into the early part of 2007, and this will be supported by a buoyant economy, stable interest rates and a continuing shortage of housing supply. Plus a bewildering graph from Fionnuala Earley
Uninformed sheeple survey
Home.co.uk News: Public under-informed about housing market
Nearly one in five people think that estate agents carry out conveyancing and further, the majority of homeowners do not know what they are paying for in a local property search. These are some of the startling findings of a poll commissioned by the Council for National Land Information Service (C-NLIS), which reveals that the British public are uninformed about many areas of the housing market.
Thursday, December 14, 2006
Interest-only mortgages warning
BBC News Website: Interest-only mortgages warning
A significant minority of people with interest-only mortgages do not have "robust plans" to repay them, warns the Financial Services Authority (FSA). [BBC Website - would you adam 'n' eve it?!]
Sluggish market hits builders in Australia
The Age: Sluggish market hits builders
BUILDERS continue to face difficult conditions, with the number of housing starts barely rising in the September quarter. Economists and industry groups point to poor levels of housing affordability and rising interest rates as reasons for the sluggish conditions in many parts of the country.
First-time homebuyers should think twice before taking an interest-only mortgage
Free Help Advice: First-time homebuyers should think twice before taking an interest-only mortgage
Experts have warned first-time homebuyers, who are struggling to get a foot onto the property ladder, should avoid taking an interest-only mortgage, unless they have a suitable repayment vehicle in place. According to the Financial Services Authority (FSA), 15 per cent of first-time buyers and repeat purchasers, who have taken an interest-only mortgage, lack an appropriate repayment strategy.
British consumers getting more cautious with their debts, says (CCCS)
Free Help Advice: British consumers getting more cautious with their debts, says (CCCS)
A quarterly report published by the Consumer Credit Counselling Service (CCCS), shows that British consumers are getting more cautious with their debts. The report states that more and more consumers are borrowing less with their credit cards and many CCCS clients are taking great care in making their debt repayments on time.
Homes to rise £14,000 in 2007
This is Money: Homes to rise £14,000 in 2007
Robust house price growth has been predicted for 2007 by Britain's biggest building society.
Were rumours of BTL death really exaggerated?
CityWire: Buy to Let: the spectre of repossession returns
The ongoing debate over whether buy-to-let repossessions are rising will, if nothing else, alert novice landlords and potential investors to the fact that buy-to-let is not a licence to print money. The cat was set amongst the pigeons by a recent report in the Financial Times which claimed that repossessions on investment properties were increasing. Both the Council of Mortgage Lenders (CML) and the Association of Residential Letting Agents (Arla), were quick to refute these claims. The difficulty in getting to the truth is that all those in the property market have a vested interest in being optimistic.
BTL first dibbs on Repos
CityWire: Fusion service to enable investors to grab repo deals
Buy-to-let investors can register with a new service which lets them get first option on repossessed properties, rather than having to bid against the professionals at auction. Fusion Property Service has introduced a home buying service for lenders with vacant accommodation or arrears on a property which might move to repossession and homeowners seeking a quick sale.
Personal and Corporate debts increase threats to financial stability in the UK!
Free Help Advice: Personal and Corporate debts increase threats to financial stability in the UK!
Sir John Gieve, deputy governor of the Bank of England, has commented that rising corporate and personal debts in the UK have increased the threats to financial stability of the country and investors are under-pricing these risks. He said that he is not sure whether these risks are priced into the market and over-optimism in the financial system can have costs not just for the consenting counterparties, but more broadly across the economy.
NAEA: Asking prices fall nearly 7% in Oct
The National Association of Estate Agents: SEASONAL PRE CHRISTMAS SLOWDOWN IN HOUSING MARKET
AVERAGE ASKING PRICE NOVEMBER 2006 £211,401 AVERAGE ASKING PRICE OCTOBER 2006 £226,768 Members of the National Association of Estate Agents (NAEA) noted a seasonal downturn in activity in the property market during November, as buyers and sellers concentrate on the festive period, rather than home moves. The number of buyers on estate agents books decreased, as did the number of properties available for sale.
Northern Ireland - what do do about high house prices
BBC: Views on high house prices sought
The government is calling for views on how to tackle the growing cost of housing in Northern Ireland. Property prices are now rising at a rate of more than £100 a day in Northern Ireland. The government has said there is a "serious lack" of decent, affordable housing for people to buy or rent.
Rate increase could be 'rise too far'
Warning as base reaches 5%: Estate Agency News
THE latest interest rate increase could be a rise too far for a significant number of areas in the UK where the housing market is under-performing, the National Association of Estate Agents have warned. As had been widely expected, the Bank of England decided to raise rates from 4.75 per cent to five per cent, following a similar increase in August. Peter Bolton King, the chief executive of the NAEA, said: “The national picture for the residential property market appears to be extremely strong and buoyant but there are vast regional differences with some areas significantly out -performing others.
Why I've lost my faith in Gordon Brown
The Times: Why I've lost my faith in Gordon Brown
The past seven days have been a watershed week in British politics. Gordon Brown may not yet have become prime minister, but already his prospective government appears to be foundering. Writing this sentence causes me considerable embarrassment and regret. Embarrassment because I have mostly backed the Chancellor’s side in the endless Blair-Brown feuds and have consistently dismissed any prospect of a serious challenge to the Brown succession. Regret, because I have always believed that Mr Brown could potentially make an excellent prime minister and that he would certainly avoid the most egregious policy errors — higher taxes, increased regulation, kow-towing to trade unions — predicted by his detractors.
YouGov poll - one in three expect HPC within 2 years.
CityWire: Huge loss of faith in housing market, poll shows
A poll by YouGov shows many are expecting a house price crash within the next 1 or 2 years. Many are therefore putting off buying as a result. One factor making people less confident in the housing market is apparently the recent rate rises.
Wednesday, December 13, 2006
Sensible Scott says change
freehelpadvice website: Many people in UK are expecting a crash in property prices: Its official
Read the comment by Scott on this site. Obsession with home ownership is ruining our lives. We live better than the Kings of old and we should instead focus on indulging in our fantasies, just like they did.
Planning to call a debt counsellor? Do it now, because they will be too busy in January!
Free Help Advice: Planning to call a debt counsellor? Do it now, because they will be too busy in January!
Debt advice agencies have urged consumers struggling with debts to contact them now, rather than waiting till the new year, during which these agencies would be flooded with calls from people having problems with their post-Christmas bills, making it extremely difficult for them to respond to debt related queries, at the earliest.
IR rise next year a done deal!
Reuters: Wages pick up pace as employment falls
Britons' pay packets grew more than anticipated in the three months to October and unemployment fell unexpectedly last month, boosting speculation interest rates will rise further next year.
Interest rates up for sure: The clock is ticking
Free Help Advice: Interest rates up for sure: The clock is ticking
Highest rises in utility bills for 26 years, pushed the consumer price inflation to 2.7 per cent in the month of November, up from 2.4 per cent in October. With inflation shooting up to its highest rate since the introduction of the current inflation measure some ten years ago, another interest rate hike seems imminent. Inflation has exceeded the Bank of England’s target of 2 per cent, for the seventh time now and it is dangerously close to the 3 per cent level at which Mervyn King, the Governor of the bank, would have to write a letter of explanation to the chancellor, Gordon Brown.
Return to the 1970's
The Telegraph: 'Dollar on losing streak, commodities are hot'
Just a quick post in the middle of my move. Jim Rogers has told a packed audience of natural resources investors to "get out of the dollar, teach your children Chinese and buy as many commodities as you can". I best invest in some commodities with the cash gained from the house sale.
Employment market remains strong
BBC: Unemployment falls to 1.7 million
Unemployment in the UK fell by 7,000 to 1.7 million in the August to October period, according to official figures. The drop left Britain's jobless rate unchanged at 5.5%, the Office for National Statistics (ONS) reported.
Pressure on rates rises as unemployment falls
Bloomberg: U.K. Jobless Unexpectedly Falls the Most in Two Years
U.K. unemployment unexpectedly fell in November by the most in almost two years and wage growth accelerated, adding to the case for higher interest rates.
Inflation remains largest fear for the US Federal Reserve
TimesOnline: Fed warns of hike, but interest rate stays at 5.25%
The US Federal Reserve warns of rise in interest rates.
Threat of rate rise in New Year escalates
TimesOnline: Rate rise threat grows as inflation surges to 10-year high
The threat of another rise in interest rates in the new year escalated yesterday after inflation figures were much worse than expected, htting a ten year high
Tuesday, December 12, 2006
Rising house prices force first-time buyers to borrow more
Free Help Advice: Rising house prices force first-time buyers to borrow more
According to the Council of Mortgage Lenders (CML), the financial strain of buying a home is increasing with time and first-time buyers are being forced to borrow more to get onto the property ladder. CML said that in the month of October, first-time buyers had to borrow a record 3.27 times their incomes to take out a mortgage and those moving house had to borrow a near-record multiples of 2.98 times their income.
Californian economy remains strong despite housing slump
Monsters and Critics: Inflation at new high
The worst part of the housing market downturn may be over in California and how long it will weigh on the state's economy may be shorter than expected, according to a report released on Monday.
Rationale behind November's IR rise
FT.com: MPC member explains why he voted to raise rates
Interest rates had to increase last month to head off inflationary wage de-mands and maintain the Bank of England's credibility, its director for markets said last night.
Expected IR rises popularise fixed rate mortgages
politics.co.uk: CML: Fixed-rates bounce back in October
New data released today by the Council of Mortgage Lenders reveals a strong bounce back in the take-up of fixed-rate lending in October - rising to 124,100 loans, from 109,100 in September. Fixed rates accounted for 62% of all house purchase loans in October, compared to 59% in the previous month.
HBOS forecasts 4% house price growth next year
The Times: Property prices set to slow down next year, says bank
The property market is set to cool down next year, with prices rising at their slowest pace since 1995, according to a forecast by HBOS published yesterday. Despite a price increase of 9 per cent over this year, HBOS predicted that house-price inflation would ease to 4 per cent in 2007 as interest rates started to bite.
any people in UK are expecting a crash in property prices: Its official
Free Help Advice: any people in UK are expecting a crash in property prices: Its official
Research carried out on behalf of the debt consultant Thomas Charles & Co Ltd, in conjunction with the market research firm YouGov, has found that one in four adults in UK are expecting a crash in property prices, in the next 18 months. The research, which covered 2,353 respondents, revealed that 19% of the adult population in the UK expects a crash in property prices within 12 months, with another 29% expecting a crash within 24 months. James Falla, director of Thomas Charles, said that the research has shown that a high percentage of UK residents have lost their faith in the stability of the housing market in the country. He added that higher interest rates and soaring bad debts will lead to a condition, where only few people can afford to gamble with a mortgage, and young people will find it extremely difficult to get onto the property ladder, as they are likely to have substantial unsecured debts and no equity.
US Slump far from over
Yahoo!: Realtors see a drop in existing home sales for second year
Following JC's lead, here's an alternative take on Ben's story on Monday. Same source, different spin. "Next year will likely bring a second annual decline in existing home sales, the National Association of Realtors predicted on Monday. Sales of existing homes are expected to decline 8.6 for 2006 and contract another 1 percent next year."
Stagflation Stagflation Stagflation, Oi Oi Oi!
NZ Herald: Tough times ahead for Australian economy
A new survey in Australia says one in 10 businesses there will be forced to lay off staff in the new year because of increased costs and lower profits. "So overall we expect selling prices to increase, we can see inflationary pressures set to remain and for most businesses there is going to be an impact in the area of sales and profits," she said.
FTSE falls- does the city fear IR increases in the New Year?
Reuters UK: FTSE falls as interest rate fears weigh
The leading share index dipped into the red on Tuesday with strong domestic inflation data raising fears of higher borrowing costs, but broad bid talk lingered in the market...
BBC cries more crocodile tears for FTBs
BBC "news": First-time buyers stretched again
Apparently, the BBC thinks that the new lending multiples used by high street banks are "more sophisticated", and that according to the CML, "first-time buyers had to borrow a record 3.27 times their incomes to take out a mortgage." They carry on "Despite this, rapidly rising prices have forced out many would-be home buyers" (refusing to see any connection between the two - quite frankly over-conservative - statistics). Why can't the BBC just pluck up the courage to sack their latest intake of journalism graduates? Silly me! I forget that their pay isn't performance linked, but license-tax linked.
Debt time bomb: Easy access to money is compounding Britain’s debt problems!
Free Help Advice: Debt time bomb: Easy access to money is compounding Britain’s debt problems!
Easy access to money is compounding Britain’s debt problems! Breakdown Britain, a report published by the group reviewing Conservative Party’s policies on social justice, has called for curbs on lending money to low-income families in Britain, since easy access to money has compounded the debt problems in the country. The report has warned that Britain is facing a “debt time bomb”, with personal and consumer debts soaring to a record level of £1.25 trillion, the equivalent of £50,000 per household.
Property prices set to slow next year say HBOS
TimesOnline: Property prices set to slow down next year, says bank
David Stubbs, the RICS economist, said: “The bleak outlook for first-time buyers looks set to darken", however “Demand (for property) remains strong, disposable income is growing and buy-to-let investors substitute for first-time buyers at the bottom end of the market,” he said. That's right Mr Stubbs, I have so much disposible income I'm lighting the fire with £20 pound notes. I don't quite understand why with mortgage rates rising, fuel (Oil, Gas etc) rising and wages rising more slowly than true inflation where Mr Stubb's gets his data from but I'll take his word for it.
US banks predict sterling set to crash
Telegraph: US banks predict sterling set to crash
"Goldman Sach has advised sophisticated investors take out a "short" position against pound on the derviatves markets as its top trade for 2007, a bet that the currency will fall."
US banks predict sterling set to crash
Telegraph: US banks predict sterling set to crash
"Goldman Sach has advised sophisticated investors take out a "short" position against pound on the derviatves markets as its top trade for 2007, a bet that the currency will fall."
Inflation Climbs in UK
Bloomberg: U.K. Inflation Quickens to Highest in Almost a Decade
Any wonder the RBA is concerned about upsized mortgages. They know interest rates will rising next year to combat inflation, stretching the ability of borrowers to repay.
UK inflation at near-decade high
BBC: UK inflation at near-decade high
UK inflation has accelerated to its highest level for almost a decade in November, increasing the chances of an interest rate rise early in 2007.
Getting out while the going's good?
This is Money: A tenth of Brits live abroad
Record numbers of people are fleeing Britain for a life in the sun. Booming house prices and a strong pound have given Britons the buying power to snap up homes abroad, a study found today.
"There must be a locker at Heathrow where they check their brains in before boarding a flight"
BBC News: Expats risking it all in Bulgaria
A BBC article about UK investors in the Bulgarian housing market. It's really rather negative. It cheered me up quite a bit.
Monday, December 11, 2006
US housing slump has only just begun but it's over already???
Bloomberg: Housing Will Recover in First Quarter, Realtors Say (Update2)
he worst of the U.S. housing slump is over, according to the National Association of Realtors.
Got debts? Pay your bills or else the bailiff will come knocking: Aggressive threats!
Free Help Advice: Got debts? Pay your bills or else the bailiff will come knocking: Aggressive threats!
Pay your council tax and mortgages first or else a bailiff could come knocking at your door. Debt counsellors have advised people facing a lot of debts over the next few months, to pay their council tax, utility bills and mortgages first, since public bodies and utility companies are among the fastest to call in bailiffs to recover unpaid bills. The advice comes despite a new protocol in Nottingham, which reduces the need for bailiffs in recovering unpaid bills.
British Glaziers Lose Their Jobs
Daily Express: Sacked because we are British
A GROUP of skilled craftsmen working on an NHS project have been sacked and their jobs given to migrant Polish workers. The 16 glaziers were axed from a hospital construction site even though one had just won an award for his dedication and professionalism.
House prices in the UK fell 0.3% in October: Not enough to pop the bubble though!
Free Help Advice: House prices in the UK fell 0.3% in October: Not enough to pop the bubble though!
According to the Department for Communities & Local Government (DCLG), average house prices in UK dropped by 0.3 per cent to £197,987 in the month of October, compared to the previous month. A drop in the price of detached houses, which fell 2.1 per cent in October, is believed to have triggered this fall. However, price of semi-detached houses, bungalows and flats rose during this period, with an exception of terraced houses, which saw a 0.1 per cent drop in their value.
BoE concerned about huge mortgage debt
This is London: Bank to warn of meltdown over giant home loans
The Bank of England will raise fears about the explosion in home-owners taking on huge home loans of more than £150,000. Record house prices are forcing people to take on the sort of debts to buy a home which would have horrified previous generations.
Different interpretation of same data.
BBC News: UK house prices 'fell in October'
House prices in the UK fell slightly in October, says the Department for Communities & Local Government (DCLG). Average prices dropped by 0.3% from September to £197,987, it said.
DCLG date underlines London inflation
Reuters UK: House price inflation hits 19-month high in Oct
House prices rose at their fastest annual rate in more than 1-1/2 years in October with prices in London leading the way, government data showed on Monday.
Central London house prices up 26% YoY according to Knight Frank
TimesOnline: Central London house prices up 26% this year, agent says
The Estate Agent Knight Frank stated that house prices in Central London have leapt 26% this year the biggest rise since the property market peaked in the late eighties. Liam Bailey, Knight Frank’s head of residential research said that last month viewing were up 40% on the same month last year and that they were also seeing increased interest from city bankers optimistic about next years bonuses.
MPC suggest rise in immigration is holding down inflation
TimesOnline: Immigrants help to hold down interest rates, report suggests
Researchers linked to the Monetary Policy Committee MPC suggest that the fourfold rise in net immigration is helping to hold down inflation but also helping to keep growth up. The researchers suggest that successive waves of immigration may be required to support the previous wave.
Huge mortgages & debts: No prob say Bank Of England. Rate rise affordable HELL YE
Free Help Advice: Huge mortgages & debts: No prob say Bank Of England. Rate rise affordable HELL YE
An annual survey commissioned by the Bank of England, has shown that the majority of homeowners in UK have no difficulties in meeting their mortgage payments. However, the survey showed that the number of people who are having trouble paying their mortgage has increased for the fourth year in a row. The survey, which covered 1,844 people, showed that the proportion of borrowers admitting to difficulties in meeting their mortgage payments had risen from just over 7 per cent to 7.7 per cent. This figure hit a low of 5 per cent in 2003. The survey also showed that the number of households, which admitted that their unsecured debts (personal loans and credit card bills) were a burden to them, has fallen significantly. This trend reflects the recent shift towards secured debts, seen in UK.
Late 1980's fever all over again!
Telegraph: £300-a-day home price rise
House prices in London are rising at the rate of £300 a day, with the value of homes in the capital's most affluent areas more than £300,000 higher than a year ago, it was disclosed yesterday. Despite a pre-Christmas dip in most of the rest of the country, prices in London increased by almost three per cent last month — adding £9,000 to the value of the average home in just 30 days. High City bonuses and an acute shortage of good housing stock mean homes in Kensington and Chelsea are now selling for £350,000 more than this time last year.
No More Pay ... But Aren't Costs Rising?
Torygraph Online: New Year deals will be on the low side, warn economists
A couple of economists report slackness in the labour market will keep pay deals subdued. Low pay deals means low inflation and lower the chances of a HPC yet the costs people are facing are ever rising.
Profit from remortgaging
msn homepage: how to profit from your mortgage
Take a look at this complicated and bamboozling way to repay your mortgage. Feel the desperation creeping in.
Tides turning or another false dawn?!?
Independent Online: Asking prices slashed as house buyers feel pinch
Homeowners selling property are cutting their asking prices in the run-up to Christmas in what could be the first sign that sellers are responding to growing pressure on buyers' finances from rising interest rates and fuel bills, two reports show today.
Sunday, December 10, 2006
Rich foreign buyers and city bonuses push London house prices into fantasy land!
Free Help Advice: Rich foreign buyers and city bonuses push London house prices into fantasy land!
House prices in London inflated 12.7% in 12 months! Estate agents in London have reported that there has been no let-up in their business. Rich foreign buyers and city bonuses are fuelling the upward movement of house prices in London, widening the gap between the capital’s housing market and that of those in rest of the country. According to the FT house price index, published yesterday, house prices in London inflated 12.7 per cent in 12 months to October 2006. If this trend continues, the annual rise will be between 11-12 per cent by December, the highest since 2002, when house prices rose by 16.7 per cent in a year.
Fixed rate mortgages popular among borrowers, who are concerned about future IR rises
Loan News: Fixed Rate Mortgage Applications Continues To Rise
According to recent statistics, the number of consumers in the UK that are taking out fixed rate mortgages over variable rate ones has risen, and this suggests to many homebuyers are concerned that the interest rate set by the Bank of England is set to rise again.
New online broker wants to take out the intermediary
Sunday Herald: Top accountant is counting on web mortgages to make his fortune
If you can be bothered to decipher this article, you will find out about an accountant who thinks he can corner 1% of the mortgage market next year.
Confusion over direction of US economy
The Times: Mixed signals are dividing the experts
BEN BERNANKE thinks America’s economy is strong, and that inflation remains a danger. The stock market believes the Federal Reserve Board chairman, so share prices hover at record levels. The bond market doesn’t — it expects that he will soon have to recognise the economy’s underlying weakness by lowering interest rates, not this week when the monetary policy committee meets, but almost certainly by the spring. The currency market is siding with the bond market, its players guessing that the Fed will indeed have to cut interest rates, making the dollar less attractive relative to the euro and sterling.
The UK’s debt epidemic: Debt councillors are urging consumers to think first!
Free Help Advice: The UK’s debt epidemic: Debt councillors are urging consumers to think first!
Consumers urged to be more responsible with their credit cards and unsecured personal loans With Christmas just around the corner, debt councillors are urging consumers to be more responsible while using their credit cards and unsecured personal loans. Britons are expected to add millions of pounds to their debts, over Christmas this year. With many towns like Crewe and Nantwich experiencing soaring levels of personal debts, Citizens Advice Bureau (CAB) has warned of the consequences of the mounting debts. Paul Nichols, manager of the Crewe and Nantwich CAB, said that helping people with debts has always been an important part of the CAB’s services, but the number of debt inquiries has been increasing steadily over the last few years. He said that the number of debt inquiries at Crewe and Nantwich CAB’s office increased by 42% during the period April to October 2006, when compared to the corresponding period last year. According to him, personal loans and credit cards continue to be the most common type of debts, but the number of clients struggling with secured loans has also increased substantially.
Saturday, December 9, 2006
‘Shared equity properties’ to the rescue so they say!
Free Help Advice: ‘Shared equity properties’ to the rescue so they say!
Inflating house prices in UK have made it difficult for many people, including first-time home buyers, to get onto the property ladder and this has caused much concern among the public in the UK. To change this scenario Gordon Brown, Chancellor of the Exchequer, has announced new plans to increase the number of shared equity properties, which would enable those who cannot afford a property, to own a stake in their own home.
NAEA put positive spin on property market: Can you smell the fear?
Free Help Advice: NAEA put positive spin on property market: Can you smell the fear?
The National Association of Estate Agents (NAEA), a leading professional body for estate personnel in UK, has forecasted a steady year for house prices across UK, in 2007. NAEA has also predicted that house prices in UK will rise around 5 per cent in 2007. Following the property downturn in 2005, house prices increased rapidly in 2006, rising around 9 per cent since the month January.
HaHa!
Citywire: Rate rises bite into buy-to-let rental yields
"Landlords’ profit margins are falling as a result of rising interest rates, while the number of new properties coming onto the lettings market is slowing."
Strong US service sector keeps housing from dragging economy down
Telegraph: US jobs rise lifts market but housing still sliding
The US economy added more jobs than expected last month but the gains masked worrying declines in the construction and manufacturing industries. More than 130,000 jobs were created in November giving a boost to the US stock markets which neared highs.
Are HLC's still necessary?
Motley Fool: Kill this housing rip-off
I spent the final years of the 20th century working for one of the UK's biggest general insurers. Being a giant in many fields, this venerable insurance company was one of the leading underwriters of mortgage indemnity guarantees (MIGs), which lost it hundreds of millions during the Nineties...
Outlook on the US economy
FT.com: Market Preview: Data offer important clues to monetary policy outlook
US interest rates are expected to remain on hold at 5.25 per cent for a sixth successive month after Tuesday’s meeting of the Federal Reserve and the data releases this week should provide some important pointers to the outlook for monetary policy.
Guardian - no HPC in 2007
The Guardian: Where do prices go now?
Can house prices defy gravity again and keep moving ahead during 2007? Despite getting it wrong this year (most predicted a modest rise of between 1% and 4% when, in fact, house price growth for 2006 looks likely to top 8%), economists, estate agents and property gurus are gamely getting out their crystal balls for 2007.
Friday, December 8, 2006
We're all doomed
IFA Online: We're all doomed!
A week old, I know, but have not yet seen this article posted. By the way, I have only been checking this blog for a couple of months. Out of interest, I would like to know how it has changed over time. Were many of you readers using the blog this time last year? If so, were the same sort of negative articles constantly being posted? Or is the cynicism about the market a recent development? Come on, be honest!
Consumer spending likely to fall in 2008: Corporate debt bubble will burst
Free Help Advice: Consumer spending likely to fall in 2008: Corporate debt bubble will burst
Keith McGregor, a partner at accountancy firm Ernst & Young, expects the consumer spending in UK to fall by 10 per cent in the year 2008. During a restructuring conference on Wednesday, he said that the annual spending on non-discretionary retail items is expected to fall, resulting in casualties in the retail sector. However, he expects the spending on food and drink to remain stable. McGregor said that the corporate debt bubble too, will burst in the year 2008, as companies acquired by private equity firms, during the 2005 private equity bubble, have to make their first debt payments after the three-year acquisition period. He added that overleveraged companies would struggle in 2008, after adding high levels of debt in the period after the acquisition.
Berkley think the possible down-turn may be serious
Daily Telegraph: Berkeley cautious on housing
The company, which operates primarily in London and the South East, said it was "conscious of the need for caution in looking ahead", adding: "There are uncertainties over UK interest rates and inflation, concerns over the affordability of housing and there remain threats to the stability of the world's economic and political climate."
FSA fines broker for promoting irresponsible lending
IFA Online: Mortgage intermediary fined for income inflation
The Financial Services Authority has fined Home and County Mortgages Limited £52,500 for inflating customers’ incomes on mortgage applications and failures in its sales processes.
NE experiences economic growth
The Northern Echo: Region's economy is booming as North-South divide closes
THE North-South divide is finally closing as the economy booms in the North-East, the government revealed yesterday. A Treasury study said growth rates were now higher across the North than in London and the South-East - reversing the trend of many decades.
Halifax index sees strong growth in housing market, but predicts slowdown
The Telegraph: Average house price rises to £188,000
The average house in Britain is now worth £188,000, according to figures released today. Homeowners saw their properties increase in value by 1.7 per cent in November, taking annual price inflation to 9.6 per cent, a survey by the Halifax said.
FT House Price Index shows London outstripping rest of country
FT.com: London’s annual house price growth hits 12.7%
London house prices are on track to end the year at their highest annual rate of growth since 2002, greatly outperforming other regions and highlighting the extent to which the capital’s housing market is breaking away from the rest of the country.
Crash Gordon's £4 trillion tax fuelled spending spree
Torygraph.co.uk: Brown launches green tax grab as he sinks even further into the red
He may have delivered a punchy Commons performance ... but the numbers buried in the Pre-Budget Report told a very different tale. Quite simply, they said, the Chancellor realised that he had run out of money. John Butler, the UK economist at HSBC, said: "He has shown quite clearly that rather than cutting spending he's going to raise taxes. It's not about redistributing income, since barely none of this money is being passed on to anyone else.
2006 ending on a high for London property
FT.com: London’s annual house price growth hits 12.7%
London house prices are on track to end the year at their highest annual rate of growth since 2002, greatly outperforming other regions and highlighting the extent to which the capital’s housing market is breaking away from the rest of the country. The latest FT house price index, published on Friday, shows that annual London house price inflation was 12.7 per cent in October after accelerating steadily throughout the year from 5.1 per cent in January.
Too few new houses?
Fool.co.uk: Pre-Budget Report: Five Key Changes
The article generally is about elements of the pre-budget report, but the first of these is about housing. The maths in summary is: 240,000 new homes needed each year to address the existing backlog and meet future need 184,000 dwellings are being created every year 23,000 extra dwellings per year could be created at identified "New Growth Points" and on Government land. This still leaves an undersupply of 33,000 homes per year... Undersupply preventing HPC? Opinions...?
Not such a great recovery...yet?
BBC: Japanese economy suddenly slows
Japan's economy has grown more slowly than predicted, figures show, raising question marks over the impact of higher interest rates on its recovery.
Insurers getting hit hard too
Telegraph: The devastating 20-second tornado
So, overinflated house prices are bad for FTBers, and anyone else trying to upscale. But once you've got a house valued high, insurance companies have to stump up the same ridiculous prices as well. Have Building Insurance costs gone up in line with house prices, or should we expect that as the next surprise? "Insurance assessors were beginning to view damage that could run into millions of pounds, in an area where houses sell for at least £600,000. One house on the road had caved in completely and houses on at least three other roads were damaged. A council spokesman said that many other houses might have to be demolished because they had suffered severe structural damage."
Commercial property maxed out
The Economist: Commercial property: Braced for impact
Yet this boom seems to have gone too long. Property prices are rising so fast that they have run away from rents and driven yields to a record low of 4.7%. That is about 0.5 percentage point below the cost of borrowing (see chart), as clear a sign of a bubble as any. And officials are starting to worry. Nigel Jenkinson, executive director for financial stability at the Bank of England, warned in a speech on November 30 of the risks to banks of a “sharp adjustment” in property prices.
The big question is still when
The Economist: House prices: Bubble and squeak
In a thoughtful recent study David Miles, of Morgan Stanley, tries to explain the doubling of real British house prices in the past decade. Some of the increase, he says, can be ascribed to rising real incomes; a smaller share can be explained by increases in population; some can be put down to lower real interest rates (including the keener pricing of mortgages by lenders). However, a lot of it is speculative. Between one-third and one-half is due to increased expectations of house-price inflation. These amplify the effects of other factors. Faster increases in prices foster the belief that future increases will also be stronger, so that higher prices fuel demand rather than dampen it. The need to explain so much of Britain's house-price inflation by a change in expectations, writes Mr Miles, “suggests that the current level of house prices may be rather unstable.” Once those expectations come down, real house prices are likely to fall. The trouble, of course, is predicting when.
Thursday, December 7, 2006
House Prices dropping in Melbourne
Herald Sun: House prices down
House Prices starting to drop, yet there are still a few optimists around who think rates cuts are going to save the day
Moneyweek analyses the Pre-Budget Report
MoneyWeek: Everything you need to know about the Pre-Budget Report
Good news for anyone who doesn't drive or fly, lives in a zero-carbon house and plans to get pregnant in the next two years. More bad news for everyone else. John Stepek examines what the Chancello's plans will mean for you.
ECB raises rates
BBC: Eurozone interest rate up to 3.5%
The key eurozone interest rate has been raised to 3.5% as the European Central Bank (ECB) keeps a close rein on inflation.
Surprise, Surprise (NOT)
BBC: Interest rates kept on hold at 5%
UK interest rates have been kept on hold at 5% following the latest meeting of the Bank of England.
BBC pro-NL spin before your very eyes!
BBC 'news': New homes to be 'zero emission'
The majority of newly built homes in the UK should be "zero-carbon" by 2016, according to the pre-Budget report. What a difference a word makes... See how the BBC substitute the word 'to' for the word 'should'. It's not even as if they couldn't fit it into the headline! A quick glance at that headline implies to me the Goverment are going to legislate that all new houses are going to be built to 'zero emission' standards.
Sounds familiar!
BBC: House price inflation 'picks up'
Annual house price inflation rose to 9.6% in November, according to the latest survey from the Halifax bank. It said prices were 1.7% higher than in October, pushing the cost of the average UK house to £187,995.
Budget boost for environmentally sustainable housing - is it enough?
The Times: Stamp duty relief to underline need for zero-carbon houses
Newly built zero-carbon homes will be exempt from stamp duty from April for at least three years, Gordon Brown announced.
City not as optimistic about growth as Chancellor
The Independent: Chancellor lauds his efforts - City is less excited
With his eyes firmly on the future - both of the economy and of his own career - Gordon Brown used his 10th and final pre-Budget report to praise his own economic stewardship over the past decade.
Bradford and Bingley new business at record levels
The Scotsman: Bradford & Bingley sees profits in line
Speciality mortgage lender Bradford & Bingley Plc said on Thursday it expects underlying profits this year to be in line with analysts' expectations and its pipeline of new business is at record levels.
Halifax reports 1.7% house price growth in November
The Times: House prices post more strong gains
The housing market continues to power on, with house prices rising 1.7 per cent last month, according to the Halifax. The lender said the annual pace of house-price growth over the three months to November hit 9.6 per cent, up from an equivalent figure of 8.6 per cent in October, with buyers seemingly undeterred by two recent interest rate rises.
Stock market crash coming soon
The Telegraph: Bosses in rush to sell their shares
Company directors on both sides of the Atlantic are cashing in their shareholdings in the biggest flight for safety since before the 1987 stock market crash. The value of boardroom sales in November outpaced purchases in both the US and Britain by a factor of more than 60 to one.
Wednesday, December 6, 2006
£150,000 house for £100,000 anyone?
Tiscali / PA Features: Overstretched Homebuyers seek a Way Out
Who fancies "brow-beating" some BTL arsehole into "selling at barely 65% of open market value ... because they fear they can't wait longer for a larger sum"?
House prices to rise 7.5% in 2007
aboutproperty.co.uk: Property News
West Wales and period properties will make the best returns.
A word to the wise on house price fears
Sunday Herald: A word to the wise on house price fears
"If we all take heed of these warnings and act accordingly then, ironically, it will make them less likely to come true". Can somebody please explain this to me?
Nobody predicting a fall in 2007
Guardian: Predictions
Market variations The strength of the housing market has surprised everyone this year, so what does 2007 have in store? Charlotte Moore asked the experts Friday December 1, 2006 Guardian Unlimited House prices have surprised everyone this year. Around 12 months ago the smart money was on a rise between 2%-4% for 2006, but the actual rate of inflation has far outstripped those forecasts - one recent estimate pencilled in growth of 8%. Many wonder if the market can continue in such rude health next year.
US Mortgage Applications up
Reuters: US mortgage applications surge in latest week-MBA
What the bleep is going on? "U.S. mortgage applications rose sharply last week, fueled by a surge in home refinancing loans as interest rates sunk to their lowest levels in more than a year, an industry trade group said on Wednesday. "
The Times' coverage of Brown's pre-budget report
The Times: Lower forecasts, higher taxes
Gordon Brown confirmed today that he has again been forced to downgrade his forecasts for the Government’s finances as they slide deeper into the red.
Estate agent bullish for 1st half of 2007, but expects cooling in 2nd half
Finance Daily: UK House Prices Set to Soar
Property prices in the UK will rise by ten per cent during the first half of 2007, according to the latest report from haart estate agents.
Rising house prices and interest rates begin to take a toll on the market
Free Help Advice: Rising house prices and interest rates begin to take a toll on the market
Research carried out by the mortgage broker ‘Mortgages Direct’, has shown that fixed-rate mortgages have become more popular among home buyers, with the number of borrowers choosing fixed-rate mortgages increasing sharply in the month of November. This new trend reflects the concern among the homebuyers on the rising interest rates.
One-fifth of Britons are concerned about festive season spending
Free Help Advice: One-fifth of Britons are concerned about festive season spending
A new survey carried out by Tesco Personal Finance, an internet and telephone based commercial bank in UK, has shown that more than one-fifth of the British people are concerned about the costs associated with the festive season and worry that this may prevent them from enjoying the season. 39 per cent of the 2,000 people covered in this survey were worried about the rising cost of heating bills during the winter season.
Pre-budget report unveils strong growth for UK
BBC News: Brown hails a strong UK economy
The UK economy is set to grow by 2.75% this year, well above Chancellor Gordon Brown's original prediction.
Parents bailing out debt riddled adult children on the increase.
Free Help Advice: Parents bailing out debt riddled adult children on the increase.
Recent research from Engage Mutual Assurance shows that an ever increasing number of retirees are forking out more & more to help ease the debt burden on their adult children. The number of retired parents helping pay of their adult children’s debt has risen from 16 to 20 percent in the last 3 months alone.
Brown urged to keep his eye on the Treasury
The Times: Don't forget the economy, stupid, and go back to basics
Gordon Brown should not forget the basics. As Chancellor, he has always liked to range more widely than the traditional Treasury brief, covering corporate governance, housing and planning and skills. And as the long-awaited date of his expected takeover as prime minister approaches, so his interests have broadened further to include terrorism, climate change etc.
Chest-beating from Brown
Reuters: Brown to talk up economy
The country's economy is getting stronger, Chancellor Gordon Brown will boast on Wednesday as he sets out his stall for succeeding Prime Minister Tony Blair in the next few months.
HPI party's over in Ireland, ha ha
Irish Independent: The 'holy grail' of falling house prices could put lots of us in negative equity
Brendan O'Connor has written one of the most selfish articles I've ever seen. For those who don't know, he's an Irish journalist who must have bought a house recently judging by the tone of this piece.
Other reasons why rate rise is highly probable
BBC News: Services boom hints at rate rises
Inflation - Housing, wages, petrol, factory gate prices and Oh!!!! we almost forgot, the biggest industry in the in the UK, Euope and even the US, the Services industy, looks set to have its 2 bobs worth. The analogy I draw is that the world economy is like a giant turbine and the more fuel you put into it the faster and faster it goes until one day it explodes in your face. Me Im a masochist....Cant wait!!!
Tuesday, December 5, 2006
HSBC, Lloyds TSB, RBS outlook on bad debts grim
Times Online: A bad combination
Steady costs, slowing revenues and worsening bad debts are an uncomfortable combination for any bank, and so it proved for HSBC in the adverse stockmarket reaction to its pre-close trading update. HSBC is only the second of Britain’s nine banks to provide such an update, but its downbeat tone is likely to find echoes elsewhere.
Production is being replaced by consumption in the US!
BBC: US services surprise with growth
The US service sector, the biggest part of the world's largest economy, has grown unexpectedly fast in November. According to the Institute for Supply Management, its services index rose to 58.9 in November from 57.1 in October. Just like the UK, apparently an economy can boom by just spending other people's money and servicing that spending! Apprenetly this is totally sustainable in the long term too...
First time buyers steer clear of Irish market
IrishExaminer.com: Fall-off in first-time buyers as mortgage lending figures rise 16.9%
THE number of first-time buyers entering the housing market is falling, as dearer house prices and rising interest rates force them out of the property sector. While new figures show that the Irish mortgage market continued to grow in the third quarter of this year, the underlying trend shows a marked slowdown.
Gordon berated for further cooking the figures
The Times Online: Tories warn Chancellor against fresh overhaul of golden rule
“For a Chancellor famous for his stealthy tricks this would be one of the stealthiest tricks of all,” the Shadow Chancellor said. “It would of course destroy any credibility for fiscal prudence that still remains." The golden rule, which means that all of the Government’s non-investment spending over an economic cycle must be paid for by taxes, not borrowing, is now widely seen by economists as badly frayed.
Renting from the bank becoming more popular...
aboutproperty.co.uk: First-time buyers favour lifetime mortgages
First-time buyers are so keen to get onto the property ladder almost half would take on a 50-year mortgage rather than take a loan from their family or buy with a friend. This means first-time buyers, who are on average aged around 30, would still not own their home until they hit their 80s.
Are we happy with the state of the economy? apparently most people are...
The Times Online: Brownie points: Britons stand alone in praising the economy
On the eve of his final Pre-Budget Report, there is some sensational news for Gordon Brown. Although the Chancellor always maintains that he has been doing a great job and that the UK economy is in fine condition, most Britons now believe him. In a seven-country survey, only British respondents said by a majority that they were satisfied with the state of their economy, albeit by only 48 to 47 per cent.
Is too much land protected from development?
The Guardian: Planning review argues 'nimby' laws hold back UK economy
The British economy is being stifled by antiquated planning laws and "nimby" attitudes that hinder the construction of offices, shops and roads, a government report will say today.
NI propert market growing by a third, in an 'unprecedented boom'
University of Ulster: Annual House Price Rise Now 32% - UU Survey
House prices in Northern Ireland are now rising at more than 32% a year, according to the most comprehensive survey of local residential property sales. Some property types in some areas, notably Lisburn, are going up at rates of up to 65%.
Brown's gold mine
Times Online: Lender demands stamp duty change
The chancellor is under pressure to reform the stamp duty system in tomorrow’s pre-budget report as figures from Halifax show that consumer bills have soared because of the government’s failure to link thresholds to house prices. Why should he? Money has to come from somewere, isn't it?
Consumer debt and a possible property crash biggest threats to the UK economy
Free Help Advice: Consumer debt and a possible property cr
The Liberal Democrats have warned that the consumer debt crisis and a possible crash in the housing markets are among the biggest threats to the British Economy. In a briefing ahead of tomorrow’s pre-budget report, Vince Cable, Liberal Democrats’ Treasury Spokesman, warned of the threats to the British economy. He said that the biggest threat to the economy is personal debt, which is getting to the levels of debt servicing in relation to people’s income that preceded the recession in the early 1990’s. He added that interest rates may be lower, but still people have to repay their debts, which are usually associated with mortgages and 770,000 people missed at least one mortgage payment in the last 12 months.
What Is Brown Planning for house price in hisPre-Budget Repor?... Well, nothing why?
Sky News: What Is Brown Planning?
Sky Business Editor Michael Wilson gives his predictions on what Chancellor Gordon Brown has for us in his Pre-Budget Report.
HSBC Revenue Gains Slow as U.S., U.K. Bad Loans Rise
bloomberg: HSBC Revenue Gains Slow as U.S., U.K. Bad Loans Rise
HSBC Holdings Plc, the world's third- biggest bank by market value, said revenue growth slowed in the third quarter as bad loans rose in the U.S. and the U.K. In the U.S., where the bank gets the biggest share of pretax profit, loan delinquencies and impairments increased from the first half of the year due to more bankruptcies and a weaker housing market, London-based HSBC said in a statement today. Trading revenue in the investment bank also declined.
UK Debt facts & figures be very afraid!
Free Help Advice: UK Debt facts & figures be very afraid!
Total UK personal debt has exceeded £1 ¼ trillion and at the end of October 2006 it stood at £1,268bn. The growth rate increased to 10.4% for the previous 12 months which equates to an increase of ~ £110bn. Total secured lending on homes has exceeded £1 trillion (£1,000 billion) and at the end of October 2006 it stood at £1055.9bn. This has increased 11.3% in the last 12 months.
Mortgage hell for thousands
BBC Radio 1 News: Mortgage hell for thousands
There are warnings that hundreds of thousands of people are at risk from losing their homes because they can't keep up their mortgage payments. Debt-help groups say banks are lending five or six times applicants salaries.
Interesting twist...
BBC: Weak dollar makes Opec cut likely
The weakening dollar is increasing the chances of a cut in output by oil producers' group Opec at its next meeting later this month. On Monday the dollar hit a 20-month low against both the euro and the pound, denting the revenues of oil exporters which sell the commodity in dollars. Higher oil prices creates inflationary pressure which can lead to higher IRs which increases the likelihood of economic slowdown which reduces the value of the Dollar which may lead to further oil production cuts...Sounds like a vicious cycle - potentially.
2007 is the start of the big turnaround
The Telegraph: No one is worried about anything... and that's worrying
I hardly need say that their confidence has little to do with attractive fundamentals, a promising economic outlook or cheap valuations. Nothing so logical, I'm afraid. Investors are bullish because they've been making money for nearly four years and they think, as they always do at this stage in the investment cycle, that the good times will keep on rolling. I find the casual disregard of the clouds on the horizon puzzling and I'm not alone. If ever a word keeps cropping up in my conversations about the markets and in the research that washes over my desk each week, it is complacency. No one is worried about anything, and that's worrying.
Monday, December 4, 2006
Will it crash in 1 year or 100 years?
BBC News: Major drawback to cheap £1K house
A three-bedroom semi-detached house in Cornwall has been put up for auction for just £1,000. The snag: the property in Wheal Harmony Terrace, Redruth, has one drawback, "serious mining issues", according to West Country Property Auctions. It's in an area dotted with mines and shafts from the early 1800's.
Investec Secuities analyst certain that IR rates won't rise
The Scotsman: Holding interest rates at 5% 'dead cert' despite inflation
INTEREST rates are widely expected to be held at their current level of 5 per cent when the Bank of England' monetary policy committee meets this week
Lib-dems are concerned about debt complacency
Independent: Lib-Dems warn on rising level of chronic personal debt
People in the UK are sinking chronically into debt and finding it harder to pay off credit card bills and meet mortgage payments, according to a study to be released this week
Buy-to-let market unaffected by IR increases
Money News: Buy-to-let is 'best' says Paragon Mortgages
The buy-to-let mortgage market is continuing to increase, benefiting landlords across the UK, says a leading mortgage lender.
Millions of Britons are still paying their credit card debts racked up last Christmas!
Free Help Advice: Millions of Britons are still paying their credit card debts racked up last Christmas!
A study carried out by MoneyExpert.com has found that nearly 4.2 million Britons are still paying their credit card debts from last year’s Christmas. Nearly 12% of all credit users still had debts on their cards, from last year’s festive spending and this trend is expected to affect the consumer spending during this Christmas. The study found that an average British consumer took 2.6 months to clear off their Christmas bills. It is estimated that around £11 billion will be spent on credit cards during this year’s festive season.
Where the money will go
ameinfo.com: The Dow Jones all time high and the coming correction!
So, after the NASDAQ in 2000 and housing in 2005/2006, where is the next big bubble going to occur? In my opinion, two asset classes stand out as asset bubble candidates: grains and Asian assets. Wheat and corn have led the grain and agricultural commodities price advance over the last two months. But now, it is very likely that the entire sector including especially soybeans, sugar, coffee, and cattle, will follow. Other 'bubble candidates', are Asian currencies, stocks, and real estate prices.
Rosie Millard has a go at tenants
The Times: Tales of a Landlady: One hell of a mess
Tenants with references may still be Satan’s spawn, says Rosie Millard If you are a tenant, please look away now. It’s nothing personal, it’s just that, according to a new survey, six out of 10 of us landladies have experienced “trouble with tenants”.
Breaking News: Estate Agents are still regarded as dishonest
BBC: Estate agencies still distrusted
A survey of 1,568 adults found that 94% thought estate agents deliberately overvalued properties and 70% believed they invented false offers.
Affordability crisis for FTBs
This Is Money: Towns where families can't buy
Half of all potential first-time buyers have been priced out of the property market by the housing boom, research revealed yesterday. Experts have identified 78 'crisis areas' where those under 40 cannot afford even the most modest starter home. They include North Cornwall, Norfolk and Rydale. Many of the worst affected areas are in rural or seaside locations, where the trend for wealthy families to purchase holiday homes has driven up prices and made property unaffordable for local people.
Inflation - No - Only 66% Pay Rise For MP's
Telegraph: MP's Want Pay Rise To £100K Per Annum
Our trusted MP's feel underpayed. As GP's earn £100K - they should too. Gordon wants us to have pay rises in line with CPI 2.4%, while his fellow MP's demand 66%????? Inflation is at 5-9% (depending on your view) and we are told soon to drop. So why do our MP's need or deserve this? Yet another example of how one rule for us and one rule for Nu Labour & House of Commons. Only posted out of sheer frustration !!! Perhaps this increase reflects the true cost of buying your second home in your local (or not) constituency.
Different view on the dollar
The Times: Demise of the dollar is greatly exaggerated
Marber’s law states that when a currency reaches within 1 per cent of a previous important high, it enters a “twilight zone” from which it could easily emerge in either direction — and as soon as it does emerge, with a move of 2 per cent or more, that establishes the new trend. Last week the dollar entered the twilight zone against sterling. If the pound now rises above $2.06, it will keep moving upwards. If it falls below $1.95, it has nowhere to go but down.
UK Inflation more like 5.8%
Telegraph.co.uk: Revealed: the real rate of inflation
Inflation data is a mixed bag - but generally high. Pensioners worst hit at 8.9%!!
Sunday, December 3, 2006
Cash-Strapped Britain??
BBC News: BRC warns on weak Christmas trade
High-street chains nervous about a possible poor turn-out for Xmas trading.
The repercussions of a weak dollar
The Observer: Plunging dollar will set world markets reeling
The slowdown in the US economy, which has sent the dollar into freefall over the past fortnight, will have devastating knock-on effects in markets around the world, analysts warn.
Times predicts probable IR freeze until new year
The Times: Rate-setters should aim for tranquil Christmas
Each month, in an effort to get under the skin of the economy, the nine panel members of the MPC are bombarded with graphs, statistics and reports at a special meeting the Friday before they set rates. Here, in the latest of our monthly series, The Times brings you an insight into where the economic winds are blowing.
More pensioners on a mortgage
The Observer: Now baby boomers climb back on the mortgage merry-go-round
More than one in 10 mortgages are now taken out by people over 50, according to the Council of Mortgage Lenders - and the proportion could rise as that age group becomes more adventurous.
Rowntree Foundation Report; findings on housing affordability
The Observer: House price rises lock out half of new young buyers
The remarkable inability of young professionals, such as teachers and nurses, to get on the housing ladder is revealed this weekend in a report that shows up to 50 per cent of potential first-time buyers have been priced out of the market.
Let them eat chocolate
BBC: Young workers 'need housing help'
More assistance is needed to help young employed people currently priced out of the housing market, Joseph Rowntree Foundation says.
Pensioners Going Down for the Third Time....
BBC News: They Should Be Getting More Help
I know it's not a popular thought on this Blog that pensioners aren't necessarily sitting on a treasure trove of wealth and are suffering along with the rest through this governmental fiasco-rama. Just have a look at what it takes for those on a fixed income to try to heat their home these days with heating costs having doubled and heating allowances a fraction of what they were last year. And then imagine what the effects of 1% tax on house value is likely to mean to many of these people. A whole new class of homeless and impoverished Brits.
Saturday, December 2, 2006
The Dollar has sneezed, will the pound catch a cold ?
The Independant: The $2 question: Weak dollar is good for visitors to US, but outlook for world economy is bleak
Transatlantic travellers hoping to cash in on a $2 pound for the first time in 14 years should enjoy the good times while they last, because a tumbling dollar could start an economic whirlwind.
Merv says spiralling debt won't harm economy!
thisismoney.co.uk: Bank governor: Families face debt crisis
Chief Sitting Bull Merv says: "there are not enough of them [IVA debtors / bankruptcies] and they are not rich for it to have a significant impact on total household spending.'
Interest Only mortgages are A-OK
Citywire: Mortgage lenders dismiss credit crunch fears
Fears of a future debt crunch for mortgage borrowers who take out interest-only home loans without any plan for how they will repay the borrowing are unfounded, according to the Council of Mortgage Lenders (CML). CML Director General Michael Coogan said: "The view that interest-only mortgages are being used as a dangerous short cut around affordability barriers is not borne out by our research."
Go for BTL
Assetz: Long-term buy-to-let 'in good health'
The Royal Institution of Chartered Surveyors said recently that the climate of rising interest rates has "painted the buy-to-let market as a less favourable investment". Nevertheless, the organisation did claim that investors had a "high level of confidence" in the long term buy-to-let market because of the low levels of selling activity. Nigel Terrington, CEO of Paragon mortgage lenders, said: "We have seen steady activity on the part of property investors, who are growing their portfolios in response to additional demand from foreign migrants, young professionals, families and students." He added that despite the rate rises this has been good news for the buy-to-let market: "With this solid demand, rental yields have remained steady over the past six months at six per cent despite house price increases." He does not expect interest rates to rise any further.
Friday, December 1, 2006
6 x Salary Mortgages are OK says Merv!!
Times Online: Governor defends mortgage lending practices
It's all fine and we shouldn't worry. Lending 5 to 6 x annual salaries is not behaving in a dangerously irresponsible way says Governor of the BoE.
Why poor Americans have stopped buying houses
MoneyWeek: Why poor Americans have stopped buying houses
US new home sales may have been down a whopping 25% year-on-year in October, but investors have taken cheer from a month-on-month price rise. A quick look at the raw data shows that the average price only rose because the majority of the lost sales were in lower-end properties. The conclusion? Rich Americans are still buying real estate, but most of their less-affluent compatriots have suddenly become rather less keen. And housing isn’t the only place we see that disparity…
Here's the answer, buy a shed!
The Guardian: Ikea launches flatpack houses in Britain
Ikea are to enter the housing market in the UK, selling flats for under 100K and 3 bedroom houses for under 150K even in the south east. First developments are to be in Gateshead and Glasgow early next year. Still having trouble getting land then I take it! Doesn't mention how it's going to stop BTL landlords buying them all though it does mention buyers may have to be chosen by a lottery so which would mean they'd probably only get one each like the rest of us!
MPC need more time with family (but no less money).
The times: MPC is meeting too often, says Deputy Bank chief
Ms Lomax won the backing of members of the Commons Treasury Committee as well as of a previous MPC member, who called for the rate-setters to meet only eight times a year, on the pattern of the US Federal Reserve. After all they have done so well.
US currency is 'toast' say dealers
The times: Dollar slump pushes pound back to top level since Black Wednesday
The prospect of a return to the $2 pound for the first time since 1980 was raised in the City yesterday after currency markets stepped up their assault on the dollar, driving sterling to a 14-year peak.
King warning on asset prices
The times: Boom at risk from rapid end to cheap money, Bank warns
“If they were to adjust quickly then you might see quite sharp movements in asset prices overall and that would have some impact on the world economy.