Wednesday, Nov 28, 2007
London crashing
Times: London house price slump sparks UK market fears
The capital's house prices fell at the fatest rate in two years, raising the prospect a slowdown will spread to the rest of the UK
Posted by confused76 @ 03:15 PM (800 views) Add Comment
10 Comments
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1. confused76 said...
But still not on the BBC!!
2. Smurf said...
"The report is expected to point to a sharp decline in the annual rate of house price inflation, to 8.5 per cent in November from 9.7 per cent the month before on its figures. "
That's still 4+ times what the ministry of truth says inflation should be for the UK. So....
let's wait for the annual house price inflation to hit negative numbers. Before that, I think I'll just watch the show from the sidelines. Got popcorn?
3. enuii said...
Not London but II have been puzzling over the drop in price of a property across the road which suddenly dropped from 299K to 200K last week, a little digging revealed that it had also been put up for auction with a reserve of 220K but there were no takers. At this point it was repossessed and put up for sale again at the more realistic price.
One wonders how many other vendors are or will be in the same situation over the winter.
4. maddison said...
If you look at the figures from the Land registry I am not sure how they can say there was a general drop of 0.6% given that virtually all of london boroughs showed an increase....
5. Growler said...
@ maddison: It's probably those properties most likely to be bought at the upper end of the market. A few £5M houses will cause a change in the stats that many smaller proeprties at £300k won't show. It's also usually these properties that start the fall, since they started the rise. Look at the London-money places like Poole, Bucks, etc etc. They are seeing price erosion.
6. confused76 said...
maddison
I think the answer is that the market has stopped and there is virtually no transactions in the most expensive post codes
7. Mj said...
Confused. Surely if the market has stopped then the transactions have fallen, not the price?
8. Mj said...
enuii, i'd be interested to know what the realistic price is for a house with marketed value of £299k.
9. denzil said...
>>London house price slump sparks UK market fears
The fact that the UK market is fearful of house price slump is indicative of an economy built around house price inflation.
10. Willsmith said...
Interestingly, if you look at the small print of the Land Registry report (http://www.landreg.gov.uk/assets/library/documents/hpir1107.pdf), it says (page 14) that 'Monthly .. percentage changes ... represent rolling four-monthly averages for the price changes over 1 month."
It's the same principle as the way the yearly figures lag what's happening, even the monthly figures have this 4-month bias.
In other words, the downturn in October is being averaged out by 3 less bad months (July, August, September). Imagine what the figures for December etc will say, when we only have the post-Northern Rock months of September, October, November and December averaged.