Tuesday, May 01, 2007
Volumes up, prices up, crash cancelled for 2007-2008?
Firstrung: House prices show biggest rises for almost two years - Land Registry
House prices continue their recent strong run (March 2007 average price increases 1.0 per cent to £178,423). House prices in England and Wales have continued their recent strong run with an annual increase of 8.3 per cent in March 2007. The monthly change in house prices of 1.0% raises the average house price to £178,423 in this month. The data for this month shows one of the highest annual increases in almost two years. A year ago, in March 2006, the annual price change was 4.3 per cent, almost half the 8.3 per cent annual price change in March 2007
Posted by converted lurker @ 12:04 PM (170 views) Add Comment
14 Comments
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1. Scott said...
For God's sake. Asking prices are going up but who is buying? This is just the last squeeze of the big tit before it is completely dry. We are heading for a recession. It is a mathematical certainty.
2. dohousescrashinthewoods said...
I still think we're on, but can't justify it in this context.
I'm sure this can be explained any number of ways (averaging effects, race to the peak, etc.) but I think it's best to keep watch.
I wonder how the FT index will compare.
3. converted lurker said...
Ft Index prepared by Calnea, Land Reg. data partly compiled by Calnea
4. Sam said...
Am sure GS is about to jump out and say something.
But I don't think so, looks like we're still on for this year, with a crash hitting home (pun intended) in 2009/10
However looking at the actual document, lambeth and Enfield saw a dip. Nationally, Solihull, Manchester, Dudley, Barnsley, and Newcastle-upon-tyne also saw dips.
Also london properties are sqewed by the large number of £2m+ properties. (I wonder how much that 100m flat effects these figures)
House price inflation over the last 12-18 months has happened - I do not disagree with that. ask anyone where this extra cash comes from and the response will is always a bit vague. - it's mostly from large multiple loans being offered by the banks, and very little else (bonuses for bankers don't count for everyday people like me).
when the credit crunch comes, it's going to be a lot harder to people. how they/we deal with it will decide what will happen in the next few years. whatever it is, HPI will revert to it's norm. that I'd put my cold hard earned cash on.
5. uncle chris said...
Hmmm - average wage £23,200 and average house price £178,423, or 7.7 times average wage. Using A&L SVR rate you would need to fork out £1,100 from your £1,450 per month take home pay to service that INTEREST ONLY (renting from the bank) mortgage - totally sustainable in my book. Boy I'm glad to be renting my 2-bed barn conversion for £400 per month - come on you BTL'ers .... buy a few more houses so that we can drive the rental costs down a bit more.
6. Davros said...
Still, I reckon the balance of the past week's news has been negative hasn't it?
7. David20040_0 said...
Oh at last, are people finally starting to realise that property will not crash in the UK.
It took you long enough.
Yes we are really heading for a slowdown when prices rise the niggest amount in 2 years.
8. Ticktock said...
Well, Its not that hard to explain really. Its called inflation (sorry MPC but it is)
The average wage to earnings is not that relevant because the government does not want you to live here anymore. It is important to understand this. Home owners are considered to be less economicaly mobile and so therefore encouraging this 'mobility' will allow you to go and live in a poorer part of the EU and raise prices there by doing so. I'm sure everyone can see why the Government might like to keep this policy quiet (as it is a total betrayal of the British people at the request of foreign capitalists) but it is the truth.
They would much rather have foriegn gangsters and cheap 'labour' own the homes of blighty. An entire generation sold into slavery by their parents upon the say so of US Investment banks. Thats what they call 'freedom'.
Still love capitalism?
9. dugmug said...
From article posted earlier, "Grantham admits that the tricky part of his bearish analysis is timing. Most bubbles go through an exponential stage before they burst, turning left and heading straight up the page."
10. denzil said...
No real surprise!
Market is still red hot in my patch of the south-west as I've been stating on here for the last 4 months. For the last 4-5 months the market has been booming!
All the old stock that was lying around has sold. From the look of things around 80%+ of properties that are coming on the market are "sale agreed" within a month. I'm talking property from across the price spectrum too; not just BTL or high-end.
Prior to base rate increases the market had been stagnant for 18-24 months. So rates go up and property goes wild again. Crazy, crazy. Some people have started "trying" the market by advertising at prices that redefine the word silly.
Completely concur with Chris's point above. The metrics are all over the place.
11. harold said...
dugmug, in relation to "an exponential stage before they burst" you might like to have a look at this article from MSNmoney (see link below). Basically, the author thinks that the Dow is in the exponential stage. It would seem plausible to suggest from the comments above, the the same could be said of the UK housing market.
http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/BadNewsThisBubbleIsWorldwide.aspx
Denzil, I guess that it is the exponential stage of the boom that 'shakes out' the remaining bears, before it all goes pear-shaped. Hang on in there.
12. C'mon Correction said...
Not in my town ! Annual house price inflation is 3% which is less than both CPI and RPI. Still by far cheaper to rent than buy.
13. Deadspider said...
What I find interesting about this new "Apples for apples" model the Land Registry started to use in September 2006 is that it makes no account of refurbishments , upgrades , extensions , conservatories etc . Also , have you noticed how most houses sold at repo auctions since late 2005 haven't appeared on the "prices sold" websites ? The Halifax repo's which generally sold for far less than previously are being held back from LR for the 2 year maximum so their effect on averages is delayed . Very underhand , but when you have up to 150 UK streets per auction showing year on year reductions , as a lender and estate agent , wouldn't you want to hide this . Nuts, just noticed , they've changed their link so you can't get to older auction results .
14. David said...
can anyone supply data on how many buy-to-let flats are actually occupied. this will be the weak point if the housing market does fall