Thursday, Jan 04, 2007
Changing tide: Property price panic
Daily Mail: Property price panic
I don't trust the Mail or EA's, but the sentiment of the article looks promising:
"The first signs of panic in the property market were reported today by a leading estate agent.
Henry Pryor, founder of one of the UK's biggest property websites, says a rush of sellers among home owners who believe the boom has passed its peak is threatening to produce a glut that will push prices down."
Posted by millard @ 12:00 PM (258 views) Add Comment
22 Comments
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1. millard said...
bloody link, this should work, click on "Property price panic" for full article
http://www.dailymail.co.uk/pages/dmstandard/frame.html?in_bottom=http://www.thisismoney.com/news
2. denzil said...
I walked past a newspaper stand yesterday and I'm sure the front page of the Mail stated that house prices will rise by 17% this year.
3. millard said...
Denzil, I saw the article as well, it's funny how one gets front page and the other doesn't.
What it does highlight is the current uncertainty within the market.
4. This comment has been removed as it was found to be in breach of our Blog Policies.
5. David20040_0 said...
It was the Express yesterday that said property prices would rise 15% this year.
6. paul said...
I liked the Daily Express headline, yes.
"HOUSE PRICES UP 15% MORE!"
then in small writing
"in 2007 (maybe)"
Seriously though, the media are playing a game called "keeping a lid on it". Armed with the knowledge that a reported 5% increase in prices will prompt a 10% rise in the number of investors, they publish house price rises by disguising house price drops. If there is a real drop in prices in the coming months, the media will simply go quiet for a while on house prices - nothing new there.
7. sirgoogle said...
Paul
Interesting point. However this is true forthe tabloids - for the Torygraph it is pushing a different agenda - its trying to trigger a crash so it can have a field day with Crash Gordon
8. Nasha said...
I've stopped reading, or at least I only read factual information with a pinch of salt these days (even scientific journals), everyone has a vested interest in something and its far to easy to push your point accross using the vast array of mass market media that is now available.
Whatever is said the sheeple, will follow whatever is pushed in there face the hardest. So if enough forms of media start reporting negative outlook on houses prices, the sheeple will respond with a negative attitudes and outlook, and some of those sheeple will work for the media and so it becomes a self for filling prophecy. This is I'm sure one of the reasons why everything has looked so rosy for so long to most people, and then suddenly everything changes.
9. Bangybongo said...
look on rightmove for properties put up for sale in the past week or so. in my areas, crystal palace and nearby places in south east london, there are more new ones than there have been in ages. the foreigners coming won't necessarily want to buy, because you wouldn't necessarily want to be lumbered with a property (and negative equity for some) in a place where you don't want to settle in the long run.
10. harold said...
A glut of property won't in itself force prices down as vendors will cling on until a golden idiot shows up. Prices will only be forced down by banks that have repossessed and are eager to shift stock pronto - this was the scenario in the last crash, i.e., the Banks led the way.
11. Mjchum said...
I do not believe this. Every sales board I see (in and around Maidstone where I work and around Weston-super-Mare where I live) either says:
For Sale - I'd say 5%
Under Offer - say 20%
SOLD - 75%
Very few properties for sale. I think HPI will be 15% over the next 12 months, seems it could be the 'Winners Curse' phase of the cycle as predicted by Fred Harrison starting now and ending late 2007 early 2008 going into one mother of a recession/depression.
Hate to ramble on, but if you consider the mess Labour have made of everything else, cannot the same be said for the economy.
It is also likely that Sterling will fail (not just fall) and since everything is imported, inflation will go wild. I think those of the lost generation who had not bought by 2001/2002 will probably be consigned to a life of non-home ownership as when the crash comes it's curtains for the UK as a 1st World economic power.
12. Mjchum said...
And to end the night in poetry . . .
Anyway, I've got to leave Britain now . . . because of,
My New Inflatable Bed
My new inflatable bed,
The only comfort I own,
Instead of a home,
Upon which I lie at night,
On this old construction site,
Has heaved a sigh of relief,
And dropped me in my sleep,
Onto the cold hard heath,
Oh what fucking grief!!!!
MJCHUM, 2007
13. Rimmer said...
Mjchum
Must be a local thing and cyclic, in Guildford where i am i would say 50% sold and 50% for sale, some of the 50% for sale have been for many months as well, dont forget when a property sells it can be a few months completing and Estate agents like to keep the boards up.
Its also seems at the moments flats etc are selling better than 3 Beds!
Depends entirely on the ability and willingness of the public to " Keep Borrowing Money" and the eagerness of our leaders to keep endorsing it.
14. Rimmer said...
Mjchum
Quote "It is also likely that Sterling will fail (not just fall) and since everything is imported, inflation will go wild. I think those of the lost generation who had not bought by 2001/2002 will probably be consigned to a life of non-home ownership as when the crash comes it's curtains for the UK as a 1st World economic power."
well that statement doesnt ring true sorry
If sterling looks to plummit the B of E will up interest rates to support it, if you want evidence of that ask Mr Lamont Number 11s Ex, Inflation wont go wild they cant and wont let it.
As for non Home ownership, if we had a decent social infastructure like Germany we wouldnt be obsessed with home ownership and renting would be a normal thing to do, after all 50% of " The House Owners " in the Uk wont have a pension and rely on their house for it, also its the house that will fund their care in later years ...............Home ownership is no holy grail to greatness or it shouldnt be.
15. Lvmreader said...
MJChum@
Who do you think will be owning anything in this country when our currency fails? Even those golden buyers (pre 2002) will be in dire straits. I know of 3 people personally with 7 figure mortgages based off just 1 big bonus year (not likely to be repeated in their sectors for a while). We are looking at financial Armageddon.
Look up the history of Argentina in the last 5 years. Think your currency cannot fail - think again.
Switzerland seems a lot more stable. 75% of people there rent. Germany, Holland have similar renting cultures.
Who are you renting from? A private individual or the bank? What is this obsession with "owning". The only owning going on is that of your economic freedom. You play the interest rate game against the banks, you always lose.
16. Mjchum said...
Lvmreader,
Yes I'm very aware of Argentina. Saw a documentary on it once. Thought it would have been all dodgy South American banks, but no it looked like a typical British high street. People were banging on the doors of the big four. Yes, this is a possibility in the UK, although I think a little remote.
17. denzil said...
mjchum you and I live reasonably close and I'll completely backup what you have written. Even the surrounding area to W-S-M is either "Sale Agreed" or "Sold" and I would say your percentages are quite accurate too.
The most bizarre thing is that the market picked up when interest rates were increased because for at least 18 months prior to the increase the market was stagnant. I've written a few times lately on here about the possibility of rampant HPI approaching due to lack of supply around our area.
The thing is when the day comes that you can't afford a house in W-S-M things are really bad. Damn awful, rehab dump. I walked down High street a while back and it just struck me that most people seemed to have been assembled from randomly collected rejected body parts.
18. Mjchum said...
Denzil,
Thus one only visits one's bedsit type flat in daylight occassionally, perhaps once or twice a month. W-S-M is hilarious! I sometimes drive through late on a Friday night after a 12 hour working day of PURE STRESS and a 5 hour drive. All manner of degenerates falling around in the gutter, abused by various substances exhibiting varying effects, toxicity and pharmacokinetics and on OUR MONEY!! All have somewhere to live, ON OUR MONEY!!!
Next door to me is a beautiful 3 storey Victorian/Edwardian semi which should by all rights house a nice family. It sold in 2000 for £110k (now worth 325k!). It houses' drop-outs at INCREDIBLY COST to the local populus (those actually in work). The guy that owns it (a good friend) told me they receive, in addition to free acommodation and food upto £225 week cash!!!
WSM has 64 "Drug and Alcohol Rehabilitation Centres". The most of any town/city in Europe! Most are con, really they are bedsits, but being classed as a rehab centre means they can rape the local taxpayer for INSANE sums of money.
Young working people today are paying HUGE TAXES for degenerates to live in houses those young people will never be able to afford. Why can't they afford them? Because their paying for these other buggers to live in them!
WSM is a MECCA for permanently pissed! No real industry, a totally crooked council and pretty strange place now.
I cannot for the life of me understand why houses are so expensive there. It's a Sh1THolE!!!!
19. Mjchum said...
Rimmer,
Yes you are right. Most people will suffer as a result of a Sterling crash. If you look at house price to income ratios in developing world countries where currencies have failed in the past, you will find them to be much greater than the UK. It's called POVERTY and we're headed straight for it. If/when HPC does happen, the economy will go with it as will the currency. Income to house price ratio is unlikely to change (both falling). An IMF bail out is probably in coming years and Lvmreader is right in comparing the UK with the Argies banking crisis!
20. Mjchum said...
Lvmreader,
Yes we are looking at financial armagedon. That's what happens in a country that has lost touch with reality. It's the "Death throws of a decadant society". I spend very little, I'm not at all materialistic and I save (also earn well, at the moment but that won't go on forever). I think it was Sam who said on the blog about how bad he felt that he saves and other people borrow, driving inflation and making his hard work/saving worthless. I feel like this too.
21. Mjchum said...
Denzil,
The old chap (father) was a property developer in WSM in the late eighties/early nineties (last crash). He went pop. But we did manage to buy back two of the properties that were sold at the last peak. This sums it all up. Sold 1990 1 bed flat £42,500 bought back 1995 £20,000. Sold 1989 Bedroom with en-suite kitchen £34,500, bought back in 1995 £17,500. The market in WSM more than halves!
22. Mjchum said...
Lvmreader,
"Who are you renting from? A private individual or the bank? What is this obsession with "owning". The only owning going on is that of your economic freedom. You play the interest rate game against the banks, you always lose."
You don't lose if you 1. Buy in a cyclic trough (bottom of market), 2. Buy in cash, 3. Buy at a time of low relative prices and therefore low capital debt but high interest rates which come down.
We are all waiting for this bottoming out of the market. It will happen, but not in 2007, 2008, 2009, possibly 2010, 2011 ending 1212. I'll probably be dead by then anyway and don't want to own a house (I do have a flat - no mortgage) in the UK. It's over regulated, over taxed, dull, grey, miserable hole where any miniscule bit of nothing is probed and researched and regulated by ignorant, paranoid VI's and Govt androids to avoid the bigger picture of a collapsing society. I hate it here!!!