Monday, Aug 27, 2007
This is for you David!
CNN NEWS: Mortgage applications slip
Mortgage Bankers Association index falls 5.5 percent on lower demand for home-purchase and refinancing loans.
Is this a recovery????
Posted by waitingfor hpc @ 11:56 AM (1443 views) Add Comment
39 Comments
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1. waitingfor hpc said...
also check out the foreclosures -no relief in site link. Bit early to be siting back yet I think.
2. david20040_0 said...
http://news.bbc.co.uk/1/hi/business/6961602.stm
US shares reversed opening falls to close up strongly on Friday, after official figures showed an unexpected increase in new home sales in July.
The Commerce Department said sales of new properties rose 2.8% to 870,000 in the year to July. The news saw the Dow Jones finish up 143 points to 13,379.
The rise in sales was unexpected, as the dip in the housing market has been behind the recent stock market turmoil.
3. david20040_0 said...
Waiting for HPC, you are wrong, house sales in the US are picking up and so is their economy.
4. Bloo Loo said...
David, I'm not sure why you put so much store on stocks and shares in relation to houseprices: the point is, credit, (mortgages) is going to get more expensive as banks are forced to price the risk correctly, - this will affect the borrowing capacity of housebuyers, and therefore the difference in price between the rungs of the house price ladder.
5. waitingfor hpc said...
there is a similar article on CNN David, but they add at the bottom that the lift is short lived due to builders offering discounts to shift houses. And the experts do not expect it to continue.
http://money.cnn.com/2007/08/16/real_estate/home_prices_fall_again/index.htm
house prices not looking rosy in the US - even after all the money poured in by the fed to stabilise the market.
one month is not a pick up. If these figures continue for the next three months then it is a pick up. At the moment it is nothing more than one months figures.
6. david20040_0 said...
Have you seen the Dow Jones today, it is up over 140 points.
The sub prime crisis has passed. OLD NEWS!
7. Scott said...
David,
I am curious as to your longer term views. If sub prime is old news to you, what do you think will happen next? You must agree that if prices don't drop, people will not be able to afford them, so what will this lead to?
Will large home owners be above the law because most police will be living in cabins and low on money? Will you be able to get your kids all A grades because the teachers will also be in cabins? Will vulnerable property owners (little old ladies) go missing with rapid changes of ownership, as happened in Russia.
Admin, do not wait until midnight or tomorrow to post this comment as you usually do because I want David to answer my question for me and for everyone else.
8. Dave Lammi said...
179,599 foreclosure filings, which include default notices, auction sale notices and bank repossessions, were reported nationwide for a 9 percent rise over the previous month and a 93 percent jump compared with July, 2006.
sales of new properties rose 2.8% to 870,000 in the year to July. This is an increae in volume not value.
This figures are for july and before the impact of the credit squeeze. This itself forced the lender's rates up making it harder to borrow money. It does appear that more new homes are being sold, but with increases in repossessions why?
Are people taking advantage of lower prices?
Are builders using heavier discounts to sell stock? What are the profit reports for these companies?
9. paul said...
"The sub prime crisis has passed. OLD NEWS!"
That's either deluded or wildly optimistic.
10. Narrowescape said...
david - time will tell if you're right about the sub-prime crisis although I suspect it most definitely is NOT old news. Before getting too excited about the figures from the DOW today, it might be a good idea to wait for it to actually open...
11. david20040_0 said...
Dow up 150, it's pretty much over.
12. enuii said...
Dave, keep your head in that bucket of sand.
Some headlines from the states/canada today:-
Bad Credit Biggest Risk to Economy (Forbes)
Debt crisis tops terrorism as threat to U.S. growth - Economist Shift Chief Worry To Subprime Disaster (Financial Post Canada)
Debt Issues Top Economists' Fears (Wall Street Journal)
This is not about the stock markets or one months house sale figures it's about real (ordinary) people loaded with excessive debt levels, the whole lending market has been behaving like the Sheriff of Nottingham bleeding the long term financial well being from working class people. The whole thing is also deeply tied into the pensions crisis as well and if people cannot afford to pay into a pension due to them servicing unsustainable levels of mortgage/loan debts then a huge amount of trouble is being stored up for the future.
Current economic growth levels are being funded by debt at the expense of a secure future.
13. planning4acrash said...
David, its not what you say, everybody has a right to their own opinion, its how you say it, everything from you is a put down, like "I told you so", "look how clever I am". You come over as totally obnoxious. You also look ignorant calling trends from bite size bits of data when you combine that with absolute confidence.
Its reasonable to say something like, "oh, if this Dow rally continues, then the credit crisis may blow over", or something like that, because there are a lot of if's and a lot of buts, and some people may actually agree with statements like and discuss with you the possibility of the rally being sustained. However, to call a turn in the market from one bit of data is plainly rediculous, unless of course if you are the chosen one David?!
14. enuii said...
Dave, P4C has a good point, you seem to use data like a New-Labour Politician would.
15. Alex1810 said...
Both of you are being silly. The recent slowdown in house prices is down to the fact that prices are now reaching the limit of affordability, despite lack of supply. Economic theory suggests prices will grow in line with wage inflation from now on, unless something happens to our economy.
There is no reason to suspect that a price adjustment will occur in the next 12 months unless economic migration to the uk (and particularly london) slows down or unless the wider uk economy suffers. This will largely depend on the performance of banking and financial services (really our only export) - which in turn depends on relatively low yeilds on corporate bonds and good liquidity in the debt markets.
Now in case you hadn't noticed - the bonds markets are f**ked. It doesn't matter what happens to US house prices, it doesn't even really matter what happens to the wider US economy, which is far less reliant on financial services / banking compared with the UK - just follow the city.
Some of us think that just as London (and therefore the UK) has become the global M&A, private equity, spinoff and other transaction center of the world over the last 10 years - it could just as easily loose that status. When the underwriters, advisors and financiers move to another country - what will we be left with ...... a lot of people in service jobs with no money to service.
That will be a good time to buy a house.. reminds me of 1991!!!
16. Bloo Loo said...
its not stocks and shares that determine houseprices- its the ability to raise thecash, and this latest crises has forced banks to reassess their credit risks and therefore they are being forced to raise loan costs, this means the difference in price betwen the rungs of the housing ladder will need to decrease due to the increased cost of finance.
17. Ihopeitgoeswithabang said...
David 2007
Have you seen the Dow Jones today, it is up over 140 points.
The sub prime crisis has passed. OLD NEWS!"
Gordon Brown, 1997 Budget Statement.
"I will not allow house prices to get out of control and put at risk the sustainability of the recovery."
LOL. Now there are two people that you really should not listen to!
18. su said...
Or David may be suffering from depression. ( often demonstrated by feeling irritable or discouraged)
The two most significant symptoms of depression are:
*Sadness or hopelessness
*Loss of interest in or pleasure from most daily activities
If David has been hoping for a crash for a long time and never seeing it despite frequent predictions that it is just around the corner - well, that's enough to depress anyone!
19. david20040_0 said...
I have become depressed by it.
I am fed up of banks saying that this heralds a 'slowdown' and then prices rocket again and this happens every month when house price figures come out.
I want a real crash, but every dawn is always a false one.
20. su said...
David, just try to concentrate on the positives. If you not convinced a HPC is just around the corner this time, then at least be encouraged that house prices are stalling. If they stall for long enough and perhaps dip a little every now and again then you may actually be able to but a decent property eventually.
21. su said...
Oops, typing error. "you may actually be able to but a decent property eventually." should read: "you may actually be able to BUY a decent property eventually"
22. david20040_0 said...
When house prices do stall they only do so for a very small period of time. They stalled in London in 2005, then looked what happened. Some people there are making 50k every year just by having a house it is insanity.
With the CPI dropping I can forsee an interest rate cut a la 2005 causing another boom after a slowdown.
23. planning4acrash said...
David, if that is the case, then you should know that there's more to life. Find a decent value rental flat/room in an area you like, use this time to save up for a deposit, or to blow it all on a round the world trip, spend your resources re-training, instead of buying a house. I've put my money and time into getting two postgrad qualifications, got the job of my dreams, and am now saving like billyo to travel the world, and can do that because I pay a fraction that I would on a mortgage. If you see markets as cycles and just position yourself properly then you benefit whatever happens. The whole point of these debates we have is deciding when the right time will be to change tack and re-position ourselves into being homeowners. I personally think I'll look back at these times with rose tinted spectacles, so, Su, your spot on. Grass aint allways greener.
24. captain sensible said...
Stats are meaningless at the moment as it is far too soon for a consistent downward pattern to have emerged. After the event, the average price fall in the 1990s bust was said to be about 15 per cent. That was the average, but I have seen examples of properties which fell at that time by 50 per cent or more. That obviously means that at the same time some properties were falling by much less than 15 per cent, others may even have been rising. Selective reporting could then (at least in the early stages) have thrown up stats which suggested things were better than they really were. I don't think that even the most deranged estate agent would try to deny the 1990s crash now, but as it happened evidence could have been found to argue against it. The only evidence I accept at the moment is that right in front of me, and in my part of the SE properties have been sticking for ages, even after significant percentage drops in asking prices, and those that eventually sell have done so for well under the asking price. Agents are trying to deny the obvious by reporting very selectively (eg on the front of last week's local property news was the headline, 'houses rise in value by £5 per hour'). I hope they keep this up, as are just making themselves look stupid and (if they need this) untrustworthy.
25. planning4acrash said...
Mr Sensible, I hope you are right and the property of my dreams pops up as soon as I get off the plane from my round the world trip!!! :)
26. su said...
David. I prescribe a long holiday abroad - somewhere remote with no access to HPC or news websites. Chill there until the New Year and then see how the situation is. You may be fretting over something that isn't going to happen. Oh, and lay off the coffee - its bad for the nerves!
27. This comment has been removed as it was found to be in breach of our Blog Policies.
28. david20040_0 said...
Planningforacrash, what did you study and it how did it lead to the job of your dreams. I think would just push up my student loan without actually getting me any closer to buying a house.
Going away on holiday isn't going to solve anything, i'll just come back to more this year, for definite it will stall.
If the BoE does cuts rates, albeit just by 0.25% then it is very likely that the 2005 scenario will repeat itself.
29. Quiet Guy said...
@david20040_0
"If the BoE does cuts rates, albeit just by 0.25% then it is very likely that the 2005 scenario will repeat itself."
David, the economy is like an oil tanker; it takes a long time to change course when you turn the wheel. Focussing on day-to-day stock prices etc is pretty pointless. I suggest that you focus on our indebtedness.
If we can keep borrowing more and more then house prices will stay high (basically a Ponzi scheme). Eventually, prices will head down but I suspect that the house market may stay high for a year or two (yes years!!!).
If you are feeling lucky, then jump in and try to flip a property onto some sucker (there are still lots out there). You might make a quick buck or you might get caught out.
Whatever, I do not expect to be hearing about big price drops this year.
30. su said...
David. Please don't take this the wrong way, but I am concerned by your continual negative comments which could well be a symptom of depression. I don't know you personally and am therefore unable to know whether or not you are truly suffering from depression. But if you have been feeling generally down & stressed in your life for more than a week or two then I do encourage you to see a sympathetic doctor who should be able to help. Depression is a common affliction nowadays, with all the stress of modern living.
31. wiltshire said...
David, I'm sorry but I'm not falling for your "I want a HPC as much as anyone" line. I don't find you believable.
"Some people there are making 50k every year just by having a house it is insanity" - Making 50k every year! What are you on about???
As for the DOW today, you're just making yourself look stupid - http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/stockmarket/2/default.stm
32. ck one said...
Won't say much as we have all said it before...but... Enjoy history, this web site will become one of the most observed and respected sites over the next 6 to 12 months. The market is turning, a flat month in the middle of summer says it all really.. Wait till we hit mid November and the backlog of properties starts building.
We Insane ones who have stayed out of the market over the past years will be hailed as gurus with supernatural powers! All kneel and praise at the altar of housepricecrash.co.uk!
33. Realist said...
Why does anyone take this woeful troll David remotely seriously?
34. Kaitain said...
"Some people there are making 50k every year just by having a house it is insanity."
Really? Do you think these people can demonstrate this by showing you their bank statements? I'm betting not.
Imagine a scenario in which everybody is told that by getting onboard a particular scheme, you'll be able to increase your paper wealth significantly. Guaranteed. And everyone can do it. You'd be a fool not to: just look at the figures!
If somebody told me this, I'd think that one of two scenarios must be the case:
1. Pyramid scheme. The last generation in is the one who foots the bill for the increased wealth of the others. Also known as the "bigger fool principle".
2. Hyperinflation. The only way everybody's paper wealth increases by a factor of three is that the currency devalues by a factor of three.
Or some combination of the two.
35. planning4acrash said...
David, I took an MSc in Town Planning full time, then took a PGdip in Historic Conservation Part Time, spending what I would have done on a 350 a week mortgage on study, and, yes, I borrowed 5k from my folks to do the full time post grad (Paid back in 1.5yrs, 80 quid a week) and the part time course paid for itself, because I worked 4 days/week, I'm now a senior town planner in a central london borough. Basically, instead of whinging about not being able to buy a house, I thought what can I best do with my cash, piss it against a wall to drown my sorrows, or follow my dreams? Everybody thought I was a nutter re-training after a BSc in Business Studies, but I didn't want to do corporate bull, and couldn't care less what anybody said, and, as soon as house prices reach a fair price, I'll be able to buy a house. You start to realise that, if, after all that study, and after getting to a senior level on a demanding job that, if you still can't afford a studio, houses are over priced and WILL fall. In the mean time, as I said, I'm focusing on furthering my career and saving for deposit, travel and generally having a good time.
36. This comment has been removed as it was found to be in breach of our Blog Policies.
37. semi-detached-from-reality said...
That comment above, no. 34.
Where on earth did that come from?
I must have missed something there.
Damn
38. planning4acrash said...
I just reported my own comment, (36) realised in retrospect that it sounded more masogonistic than funny! (must not post after a beer, must not,,,.)
39. su said...
p4c. Don't worry, I wasn't offended. I figured you weren't serious. And it was funny! You had poor Semi-detached-from-reality really confused though! : )