Monday, Apr 02, 2007
Express needs some basic economics tuition...
Daily Express: SPRING SPARKS HOUSING BOOM
"And with prices already forced up at the start of the year by a lack of properties, the latest development adds new buoyancy to a market that continues to go from strength to strength.
Many estate agents are predicting up to a 20 per cent increase in the number of properties entering the market over the next eight weeks. Nick Salmon, director of Harrison Murray Estate Agents, said last night: “What we are seeing now will turn into an avalanche by late April and early May.”
Hmm - is that the ground I see coming up to meet us..?
Posted by bidin\'matime @ 01:11 PM (117 views) Add Comment
22 Comments
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1. taffee said...
I've always thought that a housing boom continues when a flood of supply comes to the market........NOT
who the **** wrote that article?
2. royston said...
Great! Just the kind of "boom" I like. And put in such an enticing to sellers, too.
Express, keep up the good work!
3. denzil said...
To be honest I wouldn't wipe my arse with the "Daily Express" but regardless of that the thrust of this article is exactly what I've witnessed of late in my part of Somerset. I'd almost be prepared to put money on it that the first two quarters especially the second will show strong HPI.
A cannot see any whiff of a crash during 07 and will quite confidently state nothing will happen until at least 08. HPI in some areas has slowed but slowing HPI and genuine HPC are two different beasts.
4. royston said...
Question: Can any of you seriously see this market lasting until next year?
I can't!
5. japanese uncle said...
Brain implanting rather than basic economics is highly recommended.
6. doomwatch said...
There is clearly no economic logic behind this article. It may a well have been written by an "expert" from Foxtons or the Halifax.
7. dohousescrashinthewoods said...
What the article said: "Boom blah blah predicting 20% increase in supply"
What the reader understood: "Boom blah blah predicting 20% increase in price"
Clever. Looks in keeping with policy, but delivers an opposite message to anyone who can actually read.
Amazing - is this mainstream entertainment covertly reporting the truth under the radar of the ministry of information? Big brother would be most upset if he was a) literate and b) bothered to read his minions' work
8. cyril said...
The paper that brought you endless conspiracy theories about Lady Di can now apply its high standards of journalism to the housing market.
9. sold 2 rent 1 said...
royston,
The boom will last until early 2008 IMHO.
10. The_groove_regulator said...
That's one hilarious article, average house price ~£200K....like £700 gonna make the slightest bit of difference....still you have to admire the stupidity of the writing....
11. Sonic said...
"The fee for a HIP – estimated to be up to £700"
£700 isn't really all that much when you consider that house prices are rising at £1,000 a month.
It is interesting that while the United States, France and the Republic of Ireland seem to be heading downwards now the United Kingdom's market seems remarkably robust.
While the US, France and ROI continue to decline I doubt the UK will due to the fact that the UK just doesn't have the space. We have the same population as France but they have double the land.
While those countries may crash I doubt the UK will.
I agree with Denzil, also the E Midlands used to be quite stagnated but market interest is picking up at a vast pace around here.
12. royston said...
Sonic,
"While the US, France and ROI continue to decline I doubt the UK will due to the fact that the UK just doesn't have the space. We have the same population as France but they have double the land."
We had enough space before the great wave of speculators started buying and bidding up the price of everything. Why wouldn't we have enough space when the speculators go away? - which they will as soon as they can't see ever higher prices further down the line.
We haven't had a major change population - UK population growth is a steady but minuscule 0.33% per annum.
This shortage of land argument is a myth!
13. Fasteddie said...
It might only be £700 but the Estate agents are using this as a marketing weapon and recruiting many more homes. I recently looked at the possibilty of selling my home and one of the sharper EA remnded me that really I should want to get it on before June 1st and that there would be a rush before then so the chance of finding my dream home would improve.
14. Fasteddie said...
Sonic, erm Japan?
15. paul said...
This is really desperate of the Express. When those houses go unsold, watch what starts happening to prices, then watch for the rush for the exits.
(Daily Express delivery! - fresh on your doorstep!)
16. dugmug said...
Sonic, please, if having loads of land were the key, then prices wouldn't have gone up in the first place in the US, France and Ireland, would they? Because there'd be no shortage of supply, which is the only reason for prices to go up according to your way of looking at things, see? So there must be more to house prices going up and down then just supply and demand of land. Which there is - its supply and demand of money (credit) that is the key, not land. That's why Japan, that has less available land per person than we do, had a house price crash in the 1990's from which prices have still not recovered now.
Not quite HPC but also got to comment on “Energy Performance Certificate, which will cost on average £100 or less, but will help people to cut their fuel bills and reduce carbon emissions”. It may (and I only say may here) mean that people in less energy-efficient homes either can’t sell (yeah right) or have to drop their price a little, but there will still be people living in those homes either way, so how do carbon emissions come down, exactly? New homes have to conform to building regulations to make sure they are more efficient after all. So unless these energy performance certificates are going to require that older properties, below a certain rating, are legally forced to be upgraded or literally torn down, it will make no difference to carbon emissions in and of itself, Mr Government Spin Man.
17. Fahrenheit451 said...
Not to be much of a radical, but I think that last time, but correct me if I'm wrong, there was a crash it was because:
1) Unemployment went up
2) They changed the Tax for 2 persons allowances
3) Interest rates went up (The Exchequer was setting the rates)
4) The economy went down. etc.
At the moment:
1) Employment is good
2) We are being crippled with Tax (is this to support the war?)
3) Interest is going up (Bank of England sets the rates not the Government)
4) The Economy is doing fine.
Hmm, only 2 out of 4, Ok price rises might soften but not sure about crashing. And last time whilst most areas had a severe softening or marginal 1% drop in price this was soon alleviated by inflation pushing prices up again. BUT yes there were areas where there was a 10% drop in price and deservedly so... Wasn't it the over priced new developments. And guess who was hit hardest, yes its was First Time buyers.
Here's a good game, how to loose the most, buy just over £250K and pay a whopping 3% Tax on the Whole amount then sell at just below £250K and buy somewhere cheaper (to pay the mortgage) and pay again at 1% Tax.
18. Cheekie Charlie said...
Great keep the sentiment rolling and keep interest rates rising. See whose arse falls through first! Not mine.
19. mrmickey said...
I live in a Victorian terrace like most people in this country, you think were having a house building boom now think what it was like at the start of the last century. Anyway there's nothing I like more than having a good coal fire going in my front room, don't think that would do much for my carbon footprint, this energy performance certificate is a complete waste of time it's just another make work project keep the dole numbers down.
20. paul said...
I really don't think anyone should be naiive enough to believe the "shortage of housing" myth anymore.
The Bank of England ADMITTED THAT THEY STARTED THE HOUSE PRICE BOOM - Eddie George gave evidence to a Parliamentary Committee last month - WAKE UP! You can't engineer something that is already in the pipeline.
Also, if there's such a shortage of housing, HOW COME RENTS HAVEN'T GONE UP?
Duh.
21. enuii said...
There is no shortage of housing in most of the UK north of a line drawn between Bristol and Norwich, up here many houses sit for months on end at grossly inflated prices courtesy of the distortions down south. When they eventually do sell it is often for 20% less than the estate agents board price.
That is why your average 3 Bed Semi (Britains Average House) sells for £160K not £200K.
London & the South of England has a lot to answer for especially when it comes to statistics distortion.
22. Shipbuilder said...
Fahrenheit, don't buy into this 'price softening' nonsense trotted out by the papers and EAs. It's a myth. What we have had is a boom, and booms are followed by busts. Always. Since the beginning of time. There is no 'new paradigm', no boom then plateau. Bust follows boom like night follows day - why can people not understand this?
Read the article by the fella from UCD about Irish prices - in the bust, which lasts 5-10 years, houses lose 70% of their value from the peak.
Boom-bust has NEVER not happened - you simply can't repeat this enough.