HBOS Plc: GENERAL ELECTIONS AND HOUSE PRICES

Doc showing the average cost of things including houses, bread etc when various Governments were elected and during their reign. The not so interesting John Major did a very good job of keep bread prices under control, a loaf rising by 1p from 51p to 52p during his tenure. House prices also fell for the first 4 years he was in power, having also fallen in the last year of Mrs Thatcher. In the same year Major took power (1990) beer was only £1.14 a pint. The real Champion house price demolition expert was Harold Wilson. In real terms, he knocked 13% off house prices, and although the nominal increase was 7% at a time when wages were going up at 20%. This time wages are not going up anything like that, so expect nominal falls -ie prices lower without accounting for inflation.

Independent, The (London), Apr 23, 1995: Sellers Loosen Grip of negative equity

I have been doing a historic web search for old web articles on the last crash. My first recollection of the internet was about 1991 and I can't find anything going back that far as the web was still Geek toy then and estate agents and their media friends hadn't worked out how to use it at that stage. But I did find this nice article from 1995 reciting the history of the previous crash. Last time it took sellers 5 years to escape the negative equity trap, this time it will be longer because the boom was longer

FT: Rightmove benefits from slowing housing market

Would you believe it ?
"The property sales portal is paid by advertisers on a subscription basis per month, which means that the longer new-build property stays unsold and on its website, the more it earns."
"....revenue rose 69 per cent ..."

Posted by voiceofreason @ 09:16 PM 6 Comments

Times: Buyers who do not have 10% deposits are left out in the cold

You remember those BTL i@iots repeating the mantra "the power of the fiinnannciall llleevveragge" AAHHHAHAH now it is the curse!! Divide a large number by a small number, what you get is a mess! Prices will fall like leaves in autumn!

Times: Quantum's Jim Rogers says US 'out of control'

Investment biker Jim Rogers says America is “completely out of control”, there will be a 20-year bull market in commodities, and that prices will be in turmoil. "In a blistering attack on US monetary policy and the “helicopter cash drop” responses of the Federal Reserve, Mr Rogers described the American dollar as a “terribly flawed currency”...The dollar may have declined recently, he added, “but you ain’t seen nothing yet”. Gold would continue to rise, the analyst Christopher Wood told fund managers, “because it is the exact opposite of a structured finance product”." recons it will go to $3,500

Posted by happyrenterz @ 06:24 PM 11 Comments

Telegraph: US stocks fall as credit 'cancer' fears grow

''Insurance giant AIG was among the hardest hit after revealing its biggest-ever quarterly loss as a public company after taking an $11.12bn (£5.63bn) write-down on investments linked to US sub-prime mortgages. Those fears were exacerbated after analysts at UBS estimated that losses in the credit markets may soar to $600bn from $160bn.''

BBC News: Inflation rise hits US customers

US consumer spending rose more than expected in January, but much of the gain was down to rising prices. The Commerce Department said personal spending rose 0.4% last month, a bigger rise than economists were expecting. But the report showed that a key gauge of inflation rose 0.4%, with shoppers spending more on food and fuel.

Safe Haven: Gold Investments Market Update

Interesting article on Safe Haven regarding the precious metal markets and there is a chart showing the surging price of gold in GBP. Showing that gold's strength is not just a function of dollar weakness as some would have you believe. The FT reported today that Barclays said "Commodity prices are going up in all currencies. Supply losses, strong demand and low inventory levels are the key drivers, not exchange rates." Gold and precious metals are the primary asset class that will protect rich and poor in the coming years.

vnunet.com: Internet facing 'meltdown' by 2010

Being privilieged to visit the HPC website. It has taught me a lot, opened my eyes to many things. Being able to read various views in relation to house market conditions and all the relative evidence to support various points of view. The reason for this submission, was due to reading opinions expressed on HPC. And by pure chance, a simple conversation, the answer to a question was glearingly obvious. What if the consumer using the expanded data volumes (excessive MB's) and as a consequence intentional or otherwise. Imagine switching on your PC, to find that you & everyone could not connect to the world wide web. It would be instantanious, and would effect all, a short period of darkness would descend, this situation is in my view very real.

Posted by stevie dee @ 02:32 PM 12 Comments

CNN: Furniture company - or hedge fund?

Now we have DFS, CSL and Land of Leather in the UK who are so reliant on the housing market. I wonder how this will play out....?

Citywire: Mortgage lending at same level as 1995, Bank of England says

Mortgage lending picked up by 2.7% in January but the number of approvals is at the same level as September 1995, according to the Bank of England. Approvals for house purchase mortgages rose to 74,000 in January from 72,000 in December, but are still close to historic lows of 71,000 approvals in May 1995. The 74,000 approvals granted to home buyers during the month still remains close to historic lows and represents a 40% decline compared with January a year ago,

MoneyMarketing: When the going gets tough

"Woolwich announce it will be cutting buy to let loan to values to 75 per cent. In an email to brokers, the lender says it was to withdraw its 85 per cent LTV BTL. range so that is can effectively manage the flow of business it has received" This means an immediate drop of 40% in the house price (just do 100/85% compared to 100/75%) what a crash AAHHAH AHHAHAAHA AHHAH reported by a broker so situation must be worse AHAHH AHHAHHAH

Posted by confused76 @ 11:56 AM 17 Comments

icWales: Tenants at risk after collapse of buy-to-let firm

AHHA HHA HAHAHHAHHA. I m preparing to laugh very hard at the increasingly common stories of failed BTL ventures. From BBC: "A & A Property has been by hit by serious financial difficulties and administrator Grant Thornton has been called in. Michael Jones, director of the Michael Jones Estate Agents in Cardiff, said the news came as no surprise. "People who've bought at the top of the market and suddenly find that prices are falling, and of course there is a hole in their funding and the banks are starting to get very nervous about it" banks are getting nervous AHAHAH HAHHAH

Posted by confused76 @ 11:48 AM 21 Comments

MoneyWeek: Are we seeing the return of stagflation?

Forget the recession debate – the question now is 'how hard the landing will be'. And given the latest miserable data from the US, it’s hard to disagree.

FT: Peloton Partners in $2bn assets sale

“It is the classic story of when leverage goes wrong,” one investor said. “But I can’t believe this problem is confined to these guys alone.” No I can't either. This WAS one of London's most successful funds, which only LAST MONTH was named 'best new fixed income hedge fund'.

BBC News: Credit crisis claims hedge fund

A London-based hedge fund has become the latest victim of the credit crisis after Peloton Partners began shutting a $2bn (£1bn) fund due to severe losses. Peloton's fund, known as ABS Master Fund, had bet that sub-prime mortgages would decline in value and instead had focused on better quality US home loans. But these investments have also become tainted by the problems in the sub-prime market, resulting in a steep decline in their value.

MoneyWeek: Why banks may regret hiking their dividends

Royal Bank of Scotland has hiked its dividend, just to prove it still can. But with the future of the mortgage market far from certain, that might be something it comes to regret at a later date…

Independent: Inflation makes an unwelcome return

(See 3rd section of this article.) Interesting analysis of factors pointing to higher prices: "This sort of inflation is likely to prove sustained and must eventually result in higher wage demands." Looks like the core inflation index is going to have to exclude more of these pesky volatile items.

Seeking Alpha: A Misleading Chart on Credit Default Swaps

Apologies to Harry Hill! This is about the graphics that were posted onto this site earlier this month. This jorno basically says that the CDS values are not as big because they are notional amounts not actual. A Corrorally is the S&P futures and the stock market. The stockmarket is the actual physical value of the shares were traders trade the S&P based on $250 thimes the index (used to be $500 times the index) - so the notional value of contracts traded is huge. Hes comparing the CDS value used of $45m - in effect with the notional value of the S&P futures (at least thats what i think he's saying!!).

Telegraph: UK house prices drop for fourth straight month

''..There is currently an unprecedented amount of uncertainty about future economic conditions, but if the Bank of England's central projection that the economy continues to grow is correct, conditions for the UK housing market are perhaps less gloomy than some would have us believe...''

Posted by hpwatcher @ 08:04 AM 16 Comments

Nationwide [pdf]: Prices -0.5% in Feb, annual rate now just +2.7%

I'm sure there'll be a zillion articles posted on these same set of figures, but here it it straight from the source. In Feb, prices fell for the 4th month in a row, by 0.5%. The average house price fell by £38 per day in Feb. The annual rate of HPI is now less than even the official govt inflation measure, at just 2.7%. The average price was £186,723 in October, but is now just £179,358.

Posted by little professor @ 07:21 AM 19 Comments

Market Oracle: Gold Accelerating Towards Blow off Top

Current price of GLD is 95.99. He sees the top of the channel as 96.5

Posted by sold 2 rent 1 @ 06:51 AM 10 Comments

The Telegraph: Stiglitz: $3tn Iraq legacy to hit next President

In 16-years time, the US will face a $4bn annual bill for disabled servicemen, said Mr Stiglitz, who estimated that around 40pc of the 2m currently fighting in Iraq will return home severely disabled.

BBC News: Property prices fall in February 0.5%

The fourth consecutive monthly fall in property prices puts the cost of the average UK home at £179,358.

Posted by wdbeast @ 05:50 AM 8 Comments

BBC News: Branded build-to-let plan on show

There is an "insatiable demand" for rented property in London from residents in the £20,000 to £50,000 wage bracket, the group says. It wants incentives for large companies to enter the residential rental market and build-up a recognised brands. I hope this will make all the small buy to let investors packing!!

The Australian: Iraq war 'caused slowdown in the US'

HE Iraq war has cost the US 50-60 times more than the Bush administration predicted and was a central cause of the sub-prime banking crisis threatening the world economy, according to Nobel Prize-winning economist Joseph Stiglitz. The former World Bank vice-president yesterday said the war had, so far, cost the US something like $US3trillion ($3.3 trillion) compared with the $US50-$US60-billion predicted in 2003. Australia also faced a real bill much greater than the $2.2billion in military spending reported last week by Australian Defence Force chief Angus Houston, Professor Stiglitz said, pointing to higher oil prices and other indirect costs of the wars.

Huffington Post: Bush On $4 Gas: "I Hadn't Heard That"

In the US, petrol prices are predicted to reach $4 a gallon this spring. The increases could not come at a worse time for the economy. With growth slowing, energy increases that were once easily absorbed by consumers are now more likely to act as a drag on household budgets, leaving people with less money to spend elsewhere. These costs could worsen the nation's economic woes, piling a fresh energy shock on top of the turmoil in credit and housing. When quizzed at a press conference, Bush responded: "$4 gasoline? That's interesting. I hadn't heard about that." --- Is this a 1970s-style oil shock being played out in slow motion? Or peak oil? Either way it can only lead to one thing: recession.

Times: Tax crackdown on landlords

Tough times for landlords.. AHA H AHA HAHAH HAHHA HA. Just reported mine to the IR, anonymously of course. Hope they find some problems with his tax return, who does not have issues with the taxman?!?

Posted by confused76 @ 09:37 PM 9 Comments

Times: Soaring inflation, Russia and Kazakhstan

Council tax and water bills grow at double the inflation, and "wish we could be more upbeat about the house prices, but unfortunately these are growing below inflation". "The money Brits spent on overseas property grew by 229% last year" This is a sick country!

CNN: Filthy house beyond hope

Just watch it.

Mortgagestrategy: Still no end in sight to credit meltdown

Ratings agency Standards & Poors warns there's still no end in sight to the UK's credit meltdown and that it expects life to get harder for sub-prime borrowers in 2008. With falling house prices and a widening disclocation between LIBOR and the Bank base rate, it says UK borrowers are currently in a much tougher credit environment.

Times: Bush says no recession, Wall Street disagrees

''Wall Street yesterday derided President Bush for insisting that America had not fallen into a recession just as Washington published appalling economic growth and jobless numbers.''

CNBC: Bernanke's Bank Comment Rattles Stocks

"I expect there will be some failures''

Posted by alan @ 04:49 PM 17 Comments

Telegraph: Northern Rock bought rugby fields three weeks before crisis

Northern Rock bought the grounds of Newcastle Falcons rugby club for almost £15m three weeks before the bank had to appeal to the Bank of England for an emergency loan. The transaction has come to light because it was recorded in the accounts of the Falcons, which sold its grounds at Kingston Park to Northern Rock on August 17 after struggling to meet its mortgage repayments to the bank. It has been seized on by critics as more evidence of the bank's increasingly desperate acts to bolster its 2007 results. The transaction - said by analysts to have been at a high price - may also raise eyebrows among the bank's investors, who face getting nothing now Northern Rock has been nationalised, and the Government, which is liable for any losses the bank incurs.

Associated Press: Bush: US is not headed into recession

WASHINGTON (AP) -- President Bush said Thursday that the country is not headed into a recession and, despite expressing concern about slowing economic growth, rejected for now any additional stimulus efforts. "We've acted robustly," he said. "We'll see the effects of this pro-growth package," Bush told reporters at a White House news conference. "I know there's a lot of, here in Washington people are trying to - stimulus package two - and all that stuff. Why don't we let stimulus package one, which seemed like a good idea at the time, have a chance to kick in?" Bush's view of the economy was decidedly rosier than that of many economists, who say the country is nearing recession territory or may already be there.

Sky News: 12,000 Jobs Cut In Work And Pensions

Massive job cuts have been announced at the Department for Work and Pensions - with some 12,000 positions to be axed over the next three years.The news came just hours after the department signalled a bigger role for the private and voluntary sectors in helping people find work.Work and Pensions Secretary James Purnell said he wanted a "step change" in the benefits system, giving the private and voluntary sectors more freedom. Unions had already expressed concern the move could lead to job losses among DWP staff.

Posted by jack c @ 02:56 PM 6 Comments

tIMES: House sales down by a fifth

''...The number of houses sold in November last year fell by 22 per cent compared with November 2006. Figures from the Land Registry show that 90,581 properties were sold last November, down from 115,873 in the previous year. ...''

BBC NEWS: House prices still slowing down

Oh Dear!!

Boston Herald: Frank wants state to buy foreclosed homes

Barney Frank (Rep) wants Uncle Sam to loan some $5 billion to buy foreclosed homes on the cheap and turn properties into affordable housing.

Times: Redrow profits crash 35% on house sales slump

''Redrow, the Midlands-based housebuilder, became the first high-profile victim of the falling housing market as it reported a 34.5 per cent fall in first-half profits and gave warning of worse to come. ''

BBC News: Buy-to-let firm in administration

One of the biggest buy-to-let investment companies in Wales has gone into administration. Cardiff-based A & A Property had more than 250 houses and flats on its books in different areas throughout Wales.

Firstrung: UK House prices increase by 6.4% year on year - Land Registry

House prices in England and Wales have increased by 0.9 per cent according to the latest monthly figures from Land Registry. The increase takes the average house price to £186,045. However, the data shows a decline in annual house price changes, from 6.7 per cent last month to 6.4 per cent this month. London experienced annual price growth of 13.1 per cent, with the average house price for January standing at £357,976. The largest monthly growth was seen in the North West with an increase of 2.0 per cent, taking the average house price there to £139,362. The volume of transactions was down on the same period last year, with an average of 100,648 per month in the months August to November 2007, compared with 117,173 per month from August to November 2006

Posted by converted lurker @ 12:17 PM 18 Comments

bigpicture blog: Why The Fed is Compelled to Lie to Congress

Opening statement of the FOMC Chair, Senate Testimony February 27, 2008: Senators, we find ourselves in a very challenging situation. Following the dot com implosion, my predecessor at the Fed slashed rates to a generational low of 1%; the FOMC then kept rates at 1% for over a year. While that re-inflated the economy, it also set off a shock wave of inflation unseen since the 1970s. Houses doubled in price, Oil is up 5 fold, food stuffs have tripled, and the dollar has collapsed. Gold is at multi-decade highs. ... The credit crunch is unprecedented, far worse than the S&:L collapse and Long Term Capital Management -- combined....

Property Week: OFT seeks injunction against estate agents Foxtons

Most people have to earn their money, except for inverstors who have to risk their own cash and use their own skill, which is sort of working for yourself. Estate Agent are the target again, nobody has any sympathy for people who just sit there and demand money for no (or very little) work. Any landlord can then avoid putting up the rent on the next annual review if the Estate Agents fees are removed.

"The OFT objects to Foxtons' letting agreements which can potentially require landlords to pay it substantial sums in commission, where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired."

MoneyWeek: Ignore the pundits – stay out of banking shares

While equity analysts are messing about, dithering over whether banks are worth buying, the rest of the world’s asset markets are screaming about the end of the world. We’ve been living through a credit bubble – banks sell credit, and so they’ve prospered. But now the bubble has burst. That means the hard times for the banks are just beginning. Just as when the tech bubble burst, people will have a hard time coming round to believing it’s all over, and will keep buying on the dips. But ignore those tasty dividend yields...

Independent: Banking gets back to normal after years of excess

The other alarmist speech came from Hector Sants, FSA CEO. "I don't think markets are ever going to return to the way they were. The idea that at some point they will go back to normal, I think, is a misnomer." The era of cheap borrowing, he added, was over. That cannot be right either – or rather it is only right if you assume that the past three or four years were normal. By historical standards they were most abnormal for two reasons. The primary cause was abnormally low real interest rates, as you can see from the first graph. This shows real short-term interest rates in the developed countries. That dip of real rates to below 1 per cent for five years was the result of flawed central banking policies. YEESSSSSSSS!!

Posted by confused76 @ 08:40 AM 25 Comments

The Telegraph: Soaring euro threatens European jobs exodus

The euro has surged to an all-time high of $1.51 against the dollar, prompting bitter complaints from European industry and setting off a sharp sell-off in sovereign bonds from southern states deemed least able to withstand a super-strong currency.

Posted by sold 2 rent 1 @ 07:29 AM 31 Comments

Telegraph: Alistair Darling to threaten gas firms with tax

Alistair Darling is threatening to land gas companies with a windfall tax unless they cut bills for their customers.

Posted by tyrellcorporation @ 07:02 AM 10 Comments

BBC: Wales' tallest building approved

Scroll down to the end of the article for this blinding insight ... ... Michael Jones, from Michael Jones Estate Agents in Cardiff, said the housing market in the city was slowing down. "With the development of the bay, there have been a lot of people buying and speculating, and that bubble does appear to have burst," he told BBC Wales."... We've overdeveloped certain areas and built the wrong type of properties."

Posted by mark wadsworth @ 06:00 AM 6 Comments

FT.com: Insight: China unable to breathe easy over Olympics

While global financial markets remain focused on the ongoing credit crunch in the US, another market-rattling problem could be brewing thousands of miles away – in China.

Guardian: Huge bonuses for bankers encourage too much risk-taking, watchdog warns

The boss of the Financial Services Authority this morning launched an attack on the culture of big City bonuses, warning that they could encourage too much risk taking. Hector Sants also said the markets would never go back to "normal" following the credit crunch and that the days of easy credit for customers may be over.

The Sun: Solid foundations - viewings are on the rise.

Persimmon chairman John White said: "We are not calling the ‘turn’ but, as each week goes by, we have definitely seen an improving trend. “More people are visiting our sites each week and there are more reservations. While mortgage lending has tightened, people now understand the new criteria more clearly, and more are coming to look at our new homes.” THE SUN SAYS: This is the first piece of good news from this battered sector for a while. Longer term, prospects should be good, with demand for new homes outstripping supply.

Posted by little professor @ 10:42 PM 14 Comments

ConspiracyPenPal: Fun with Numbers

Hey, boys and girls! Want to have some fun? With numbers? Follow along and let's see just how much fun Mom & Dad have been having with what they call "finances."

BBC: Kids plundering parents' savings

Interesting little article if you read it, includes the hidden gem revealing that 42% of Adult Kids used money from their parents to pay debts up from 22% last year! Article also expects parents to stump up cash in the coming year for house deposits as 125% deals dry up!

Realtor: Detroit housing

A bubble deflates...

Moneynet: BORROWERS LEFT HIGH & DRY AS MORTGAGES TIGHTEN

As the credit crunch tightens its grip, one of the most telling signs of what's to come can be found in the mortgage market. With lenders increasingly turning the screw and tightening their lending criteria many borrowers will be left high and dry with expensive and inflexible mortgage deals.

BBC: Fannie Mae hit by housing gloom

US mortgage giant Fannie Mae has posted a $3.55bn (£1.8bn) loss for the three months to the end of December. It blamed rising home loan defaults and set aside $2bn to cover further bad loans, warning the US housing slump could still get worse. The quarterly loss cut into full-year earnings and the firm reported a loss for 2007 of $2.05bn, compared with a profit of $4bn for the year before. It said it expects US house prices to fall between 5% and 7% in 2008.

SOTT.net: Reading the numbers

£110 billion is more than the UK government spends in one year on the entire National Health Service. So why is the UK government doing this and where is the money going? - The UK government is desperately trying to rescue a large UK mortgage lender while the Federal Reserve is secretly funding US banks to keep them afloat. The collapse of the international banking system is imminent. For the elite it will be a bonanza while for the rest of us it spells a return to servitude in a feudal society.

BBC: Bernanke hints at more rate cuts

US Federal Reserve chief Ben Bernanke has hinted that the central bank is prepared to cut interest rates further to help ease recession fears. In his semi-annual report to the US Congress, Mr Bernanke said the Fed would continue to "act in a timely manner as needed to support growth". Analysts said his comments increased the likelihood of another rate cut at the Fed's next meeting on 18 March. US interest rates are currently at 3% after two major reductions in January.

Posted by jack c @ 03:22 PM 16 Comments

Firstrung: First time buyers priced out due to buy to let investors no reason for CML celebrations - Firstrung

As the CML proudly announced yesterday that the total buy to let mortgage number had finally passed through the one million mark Firstrung condemned firstly the insensitivity of this proclamation and secondly stated their position that (in their considered opinion) this figure actually represents one million less buying opportunities for first time buyers...

Ananova: Girl's guilt over borrowed cash

A Polish girl racked with guilt over borrowing £13 from a man on holiday in Austria travelled hundreds of miles across Europe to try and return it.

Wall Street Journal: Decline in Home Prices Accelerates

Posted by happyrenterz @ 01:24 PM 8 Comments

Bloomberg: Roubini Interview Video

Only 5 minutes but worth a watch. Roubini is a bearish economist who has been spot on about the housing bubble.

Tampa Bay Online: Mortgage Note Issues Help Debtors Avoid Foreclosure

Shortcuts taken in the rush to issue as many sub-prime mortgages as possible in the states have rendered homes impossible to foreclose

Guardian: Information tribunal rules that MPs should disclose details of expenses for second homes

MPs have lost a battle to block the detailed disclosure of expenses covering their second homes, power and telephone bills, and the furniture they buy... It should be released within 28 days, according to the ruling by an information appeal tribunal... The allowance - called the additional costs allowance (ACA) - entitles MPs to an additional £22,110 a year to cover the costs of setting up a second home if they live away from London... But MPs' addresses can be disclosed, unless there are specific security concerns, and the names of landlords and mortgage lenders would be released... John Spellar... said last night: "This decision is absurd and ridiculous. It will end with people writing about how much MPs are paying for a pint of milk." Does he pay ridiculous amounts for milk?!?!?

Posted by disillusioned @ 12:40 PM 12 Comments

BBC: Oil hits $102 for the first time

The price of oil has hit a record high for the second day running, touching $102.08 a barrel for US sweet crude. However, the figure is still surpassed in inflation-adjusted terms by the peak of $102.53 reached in 1980, the International Energy Agency says. The oil price surge is supported by traders switching their cash out of shares and currencies and into commodities, traders say. Fears that producers' cartel Opec will cut supply have also been blamed.

Posted by jack c @ 10:54 AM 14 Comments

Telegraph: Gordon Brown's long boom ending with recession is a real possibility

"Since then debt and house prices have inflated enormously to levels which, in relation to income, are now the most extreme in the developed world. The bubble is now bursting. Forward markets tell us that house prices are likely to fall 10pc on average this year. Serious people anticipate a 30pc to 40pc correction over the next few years." Is there a more level-headed and wise politician than Vince Cable? A breath of fresh air between the lamentable inanities coming from the Govt.

Posted by letthemfall @ 10:48 AM 8 Comments

MoneyWeek: Northern Rock: a lesson in how shares go down as well as up

Private shareholders are happy to take the verdict of the market when share prices are going up. They will have to take it on the chin when things go the other way. And, if they want to be taken seriously, they will have to grow up.

The Corporation: Kids plundering parents' savings

Once it was just the magic fridge that children raided, only for it to be refilled by their parents. Now a survey claims adult youngsters are plundering their parents' savings at an increasing rate. Some 55% of parents polled had given an average of £12,610 to their children or grandchildren, according to the survey by Scottish Widows Oh to have a wealthy parent... My parents ask ME for money...!!!

Times: HBOS profits hit by downturn in credit markets

''HBOS, Britain’s biggest mortgage lender, reported broadly flat annual profits for 2007 as it struggled to maintain margins in its core retail banking business. The owner of Halifax and Bank of Scotland posted a 3 per cent increase in underlying pre-tax profits to £5.71 billion in the year to December 31, compared with £5.54 billion the previous year''

Guardian: Earthquake shakes Britain

Sorry, I couldn't resist!! I wonder how many Barrat homes were destroyed in the the quake.. I bet all the new build homes in the area are dropping to bits after last nights quake!

Posted by george monsoon @ 08:01 AM 14 Comments

ThisIsMoney: BTL mortgages hit 1 million as house prices tumble

Nearly 1,000 buy-to-let mortgages were taken out every day last year, pushing the number of the loans to a record one million. The figures emerged as evidence grows that the decade-long house-price boom is over, with prices falling across the country. Britons have taken out a total of 1.04m BTL mortgages - up from fewer than 30,000 when records began in 1998. This was despite the fact that experts predict house prices have stopped climbing, and the average gross annual rental yield (rental income expressed as a percentage of a home's current value) is negative for the first time, according to ARLA.

Posted by little professor @ 07:35 AM 35 Comments

thisismoney: Cheap credit 'gone forever' - City watchdog

The era of cheap credit may be over forever, the head of City regulator the Financial Services Authority said today. Hector Sants said he believes the financial markets will never return to the practices prevailing before the global turbulence sparked by last summer's crisis in the US sub-prime mortgage market.

Posted by uncle chris @ 07:33 AM 8 Comments

Independent: What we learned from the 80s crash

Are we heading for another recession? Four experts who survived the last big crash explain why 2008 should not be the year of a similar meltdown. The estate agent, Peter Bolton King: "I'm expecting a soft landing this time, rather than a crash, with zero price growth in 2008. There is a big difference between then and now. In the early 1990s there were high interest rates, high unemployment and high inflation. We have none of those three things now. I don't think we should panic." The mortgage lender, Mark Boleat: "The turn came fairly quickly, in 1988. There were clear reasons for it - rising interest rates and soaring unemployment levels. That's the big difference between then and now."

Posted by little professor @ 07:32 AM 23 Comments

Telegraph: Dollar's slump to $1.50 raises European alarm

The dollar tumbled through the $1.50 mark against the euro for the first time today as the US Federal Reserve made clear it will slash interest rates further to head off a severe recession. The Fed's influential vice chairman, Donald Kohn, yesterday played down the inflationary threat in America, arguing instead that "the adverse dynamics of the financial markets and the economy have presented the greater threat to economic welfare in the US."

BBC Economy: FSA sees credit squeeze on banks

FSA chief executive Hector Sants said banks will never again be able to raise as much money as cheaply as they had been doing by selling off their loans. In an exclusive interview with the BBC, he said they will have to keep more of their loans on their own books. That, in turn, may permanently push up the cost of borrowing for all of us. "Banks themselves need to give consideration to how their business models will need to adapt to the changed market circumstances they have seen," said Mr Sants

cnbc: Greenback Rebound

USD Undervalue Against The Euro And Several Major Currencies

BBC News: Fashion chain in administration

Women's fashion store chain Select Retail has gone into administration. Select blamed the move into administration on a "deteriorating trading performance" since the start of the year. Yeah that's right since the START of the YEAR! Things must be bad on the high street!

YAHOO BIZ: While Wholesale Inflation Rises at Fastest Pace in 26 Years

In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food and energy left wholesale inflation rising at the fastest pace in a quarter-century..

AP - Yahoo: Banks crises bad for hearts: British researchers

Thousands of people could die from heart attacks if there was a widespread repetition of the crisis at Britain's Northern Rock bank, according to a study published by British researchers on Tuesday. A team of sociologists at Cambridge University suggested that the stress of a system-wide banking crisis could lead to a 6.4-percent surge in heart attacks in high-income countries such as Britain and the United States

IHT.com: After subprime debacle, U.S. wrestles with question of bank bailouts

US - Over
UK - Doomed
Ireland - Finished
Spain - Buried
Australia - Down and Out

IHT.com: Credit crunch reaches picturesque resort

The effects of the worldwide credit crunch reached a remote part of Idaho this month. Four-year-old Tamarack Resort said construction of its ski village near McCall, Idaho, has ground to a halt after Société Générale pulled the plug on a $118 million loan Tamarack needed to finish the complex of shops and condominiums. Tamarack is the biggest new public ski-and-golf resort built in the United States since Deer Valley, Utah, opened in 1981. Andre Agassi and Steffi Graf, the tennis champions who are husband and wife, gave the resort a lift when they agreed in 2006 to build a Fairmont hotel there.

Harpers: The next bubble: Priming the markets for tomorrow's big crash

"That the Internet and housing hyperinflations transpired within a period of ten years, each creating trillions of dollars in fake wealth, is, I believe, only the beginning. There will and must be many more such booms, for without them the economy of the United States can no longer function. The bubble cycle has replaced the business cycle." Great article, recons the next bubble is alt energy.

Posted by happyrenterz @ 06:07 PM 25 Comments

Independent: Buy-to-let landlords feel the strain

"According to new figures from the Council of Mortgage Lenders (CML), the number of landlords in arrears on their mortgage by more than three months rose to almost 7,600 during the final three months of last year, up from about 6,050 in the previous quarter. Year on year, the number of landlords in arrears was up more than 54 per cent." REPOSSESSIONS, WHATs IN A NAME!

BBC: Have the buy-to-let blues begun?

With a remarkable change of sentiment the BBC fingers Manchester, Leeds, Nottingham and Birmingham as New-Build Buy-To-Loose hot spots and features Manchesters up-market Beetham Tower as a particularly good example.

MoneyWeek: What silver's strength means for the gold price

Last week was a good one for precious metals. But although it is gold which has been hitting all-time highs, silver has actually risen the most so far this year. And that's a very important technical development.

Times: Don’t fall for the freebies offered by package home developers

an example of how the media tune is changing. but my favourite is the reader comment who sums up the lack of brain of typical BTL investor: "Simple principle in finance, the less you pay for a high value asset, the more risk you take on. You are then compensated for the additional risk by high returns. Warren Buffet Wannabe, London"

Telegraph Online: BoE fears largest ever peacetime liquidity crisis

The Bank of England's Deputy Governor today warned that the ongoing credit crunch had left the Monetary Policy Committee uncertain as to its next move as it and fellow central banks face up to what she described as the "largest ever peacetime liquidity crisis".

Guardian: France's Sarkozy tackles voters' inflation worries

Nicolas Sarkozy on Tuesday stated that his government was working to combat soaring food prices and was ready to do more to encourage overtime work to put more money in peoples' pockets.

FT: How super-rich can avoid lynching

"That sentiment has marked the US presidential election campaign as fears of recession grip the country. House prices are falling, over-stretched mortgage holders are losing their homes, banks have blown billions in the credit markets and yet disgraced financiers have walked away with millions in a perverse “heads-I-win, tails-you-lose” kind of capitalism. The two remaining Democratic candidates, Barack Obama and Hillary Clinton, have been feeding off such populist resentments. Mr Obama, in particular, has been attacking the “moral deficit” in the US that has led to such a wide divide between the super-rich and 37m poor Americans. “We have a deficit when CEOs are making more in 10 minutes than some workers make in 10 months,” he says."

The Associated Press: Home Prices Drop 8.9 Percent in 3 Months

NEW YORK (AP) — A closely watched study shows U.S. home prices falling 8.9 percent in the fourth quarter of 2007. That marks the largest drop in the index's 20-year history and a full year of declining values. The Standard & Poor's/Case Shiller home price indices reflect year-over-year declines in 17 metropolitan areas with double-digit declines in eight of them. Index architect Robert J. Shiller said "wherever you look things look bleak." The quarterly index tracks prices of existing-family homes nationwide compared with a year earlier.

Bloomberg: S&P/Case-Shiller Home Prices Fell 9.1% in December

Feb. 26 (Bloomberg) -- Home prices in 20 U.S. metropolitan areas fell in December by the most on record, reflecting the deepening housing recession, a private survey showed today. The S&P/Case-Shiller home-price index dropped 9.1 percent from December 2006, after a 7.7 percent decrease in November. Nationwide, home prices fell 8.9 percent in the fourth quarter from a year earlier, the biggest decline in 20 years of record keeping. Prices may fall further as would-be buyers hold out for bargains and foreclosures add to the glut of unsold properties, extending the worst housing slump in a quarter century. Shrinking home values and credit restrictions threaten to reduce consumer spending and push the economy into a recession.

BBC News Website: US foreclosures up 57% in January

This is amazing. At the moment the US problems seem to be accelerating. The UK is probably 18 months behind the US, so we have just seen the start here, but by this time nex year all will be apparent.

USA Today: US house prices drop 8.9%

Steepest drop in the 20 year history of the Standard and Poor US house index

Market Oracle: Subprime Mortgage Scam Lands US Tax Payer $739 Billion Bailout Bill

"Why on earth would the taxpayer want to buy 600,000 subprime mortgages at “current value” when housing prices are falling, inventory is soaring, sales are sagging, foreclosures are at historic highs, and millions of homeowners are expected to simply “walkaway” from their loans?"

BBC: Bank warns of more economic risks

Rachel Lomax said there was uncertainty over the full impact of "the largest ever peacetime liquidity crisis". The deputy governor believes the credit crisis will significantly reduce demand over the next two years.Inflation is also forecast to rise more sharply. Ms Lomax warned this may lead to higher interest rates than expected if prices and wages rise further.

Posted by jack c @ 01:34 PM 9 Comments

Bloomberg: Producer Prices in U.S. Increase More Than Forecast

Prices paid to U.S. producers rose more than twice as much as forecast in January, pushed up by higher fuel, food and drug costs, signaling inflation may keep accelerating even as growth slows. The 1 percent increase followed a 0.3 percent drop in December, the Labor Department said in Washington. The median forecast in a Bloomberg News survey of economists was for a 0.4 percent gain. Excluding food and energy, so-called core wholesale prices climbed 0.4 percent, the most in almost a year. Combined with figures showing consumer prices also rose more than forecast, today's report may prompt the Federal Reserve to consider raising interest rates as soon as the economy stabilizes.

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset (Update2)

Feb. 26 (Bloomberg) -- Bank seizures of U.S. homes almost doubled in January as property owners failed to make higher payments on adjustable-rate mortgages. Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent. ``The most troubling thing is that we are seeing more and more of these properties actually going all the way through the process and going back to the banks,'' Rick Sharga, executive vice president of Irvine, California-based RealtyTrac, said in an interview.

BBC: London Scottish Bank scraps dividend as losses hit £16m

London Scottish, which has been in discussions with the City's top watchdog the Financial Services Authority (FSA) over its capital base for five months, said that it had a capital shortfall of £12.7 million on January 1. It has been ordered by the FSA to increase reserves dramatically, but said today that it has agreed a plan, which will mean selling parts of the business, reducing lending volumes, scrapping the dividend and seeking alternative funding

BBC: Buy-to-let market still thriving

"None of this is surprising, this is the most prime sort of lending," said Malcolm Harrison of the Association of Residential Letting Agents (ARLA).

BBC Evanomics: Flat Market

Excellent article showing an understanding of the lies and half-truths told by pyramid groups in collaboration with surveyors and authorities to dupe the greedy and desperate.

sky news: Iraq Cabinet Discussions To Be Revealed

The Government has been ordered to release the minutes of Cabinet meetings where military action against Iraq was discussed.

BBC: Lender moves to debt collection

Mortgage and loan firm London Scottish Bank has said it is to end its lending business to focus on debt collection.

Firstrung: The OFT has issued High Court proceedings against Foxtons estate agents

The OFT has issued High Court proceedings against Foxtons Limited seeking a declaration on the application of the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs) to certain terms in Foxtons' lettings agreements with landlords. The OFT is also seeking an injunction against Foxtons preventing it from using the terms...

FT: Buy-to-let lending up in 2007

"Michael Coogan, CML director general, commented: "Tenant demand for private rented property remains strong and buy-to-let is fulfilling an important role in helping to deliver an increased flow of high quality homes to rent. " - Waffle. what's the high quality bit got to do with it? Some are bogging. "The proportion of buy-to-let mortgages taken into possession was also smaller than in the wider market" - Only just, so far & the trend is massively up. "We expect to see a continuing healthy appetite for buy-to-let finance this year, in line with continuing expected consumer demand for private rental property." - only from naive investors with deep pockets. Risky - Rent will barely cover costs, no cushion for contingencies and why buy a capital asset at the top of the market?

The Telegraph: Anti-depressants 'no better than dummy pills'

Seeing as we already discuss corruption and fraud in financial/political areas, is this article saying that the big pharma companies have been selling us a lie for decades, or did they really not know their drugs were not necessary.

Posted by sold 2 rent 1 @ 10:40 AM 11 Comments

Firstrung: Buy to let investment now over as Nationwide raises deposit requirements to 25%

Nationwide has signalled the death knell to buy to let investors by announcing that is was effectively 'shutting the door' on buy to investment as it raised its deposit requirements (for its best mortgage rates) to 25%. Buy to let investors, who typically revolve their credit agreements and flex more equity out of each property with each 'new deal' to increase their portfolio will be left stunned by this development...

Dan Amerman: Turning Inflation into Wealth

Chilling dissertation about the impossible pension and healthcare liabilities of Western Governments and how they will be solved with inflation. Thought provoking for anyone who has sold to rent and is wanting to look after their stash in the mean time...

Posted by cornishman @ 10:23 AM 19 Comments

MoneyWeek: The housing slump is here to stay

The UK housing market is looking more sickly than at any point since the housing crash of the early 90s. The optimists are still clinging desperately to the hope that falling interest rates will save the market. But those hopes look like being dashed, now that one of the country’s top mortgage lenders has admitted that it would rather turn away business than dish out any more risky loans…

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset

Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent.

Times: Persimmon profits flat as order book drops 20%

Visitor levels have been increasing week by week since the start of 2008, but conversion to sales ratios remain "challenging," the company's trading statement says

Bloomberg: Goldman, Lehman May Not Have Dodged Credit Crisis

* Variable interest entities (VIEs) may contribute another $88bn in losses for banks roiled by the collapse of the housing market - CreditSights Inc. * A fire-sale of VIEs has "Always been our greatest fear," Gregory Peters - Morgan Stanley * Wall Street firms may be forced to return those assets to their books, recording the declining value as losses. * VIEs, aka conduits, had $784 billion in commercial paper outstanding as of last week - Moody's Investors Service & the Federal Reserve. * "Predictions for losses vary widely because banks aren't required to specify the type of assets being held in VIEs or how much they are worth," Tanya Azarchs - S&P

FT: Mervyn King predicts 4 years of falling house prices

In yet another blow for the housing market, Mervyn King, the Governor of the Bank of England, has issued a sober assessment of UK house prices. The Governor warned that UK house prices may fall in real terms for as long as the next four years, as prices largely stayed the same or fell. He was speaking following the release of the Bank's quarterly inflation report, in which he dampened market hopes of a series of interest rate cuts.

Posted by jack c @ 08:05 AM 19 Comments

FT: Scot property market 'stopping to get breath'

The average price of a house in Scotland has fallen by £411 a week - or nearly £60 a day - in the last three months, according to a report by Lloyds TSB. But despite the quarterly fall, all areas of the country are still showing healthy annual price increases of up to 30 per cent, with Aberdeen remaining Scotland's top property hot spot.The latest Lloyds TSB Scotland Scottish House Price Monitor said there is no cause for panic despite the boom in prices coming to an end. The bank said that property prices in Scotland will "plateau" with the country avoiding a damaging boom-bust scenario.

Guardian: Banks are kicking away the bottom rung of the property ladder

"As a consequence of the credit crunch and sub-prime mortgage concerns, lenders have become much more careful about who they lend to, and on what terms. What we're seeing now is lenders leapfrogging each other to pull deals or raise rates, effectively chasing each other down the best-buy tables. The big mortgage lenders are in competition with each other - but this time it's to be nowhere near the top of the table"

Posted by little professor @ 07:42 AM 7 Comments

Telegraph: Interest rate cuts are helping house prices

Persimmon, Britain's biggest housebuilder, said that the two interest rate cuts since November are slowly starting to improve consumer sentiment, although it revealed its reservations were 19pc lower than this time last year. The Persimmon chairman said that while many were still adopting a "wait and see" approach to buying a new home, Persimmon was seeing more customers come through its doors every week since the new year. However, converting those visitors into buyers "remained challenging", he said.

Posted by little professor @ 07:39 AM 6 Comments

FT.com: Wheat prices in biggest one-day rise

Prices of top-quality wheat jumped 25 per cent to a record high on Monday in their largest one-day increase as Kazakhstan, one of the largest grain exporters, said it would impose export tariffs to curb sales. The move, which follows similar export restrictions in Russia and Argentina, is likely to put further pressure on already tight global wheat supplies, analysts said.

Posted by uncle chris @ 07:27 AM 7 Comments

The Times: Ten tips to survive a property downturn

These tips seem designed to avert panic thereby preventing in the short term on run on houses. Equally they looked designed to lure in innocent first time buyers. Meanwhile the so called smart money that has been extracting itself will be given more time to get out.

Firstrung: 95% FTB mortgage

Not all mortgage companies are restricting lending, as i said the competition for business is still there...

Posted by greenbay @ 06:35 AM 6 Comments

wikipedia: Monopoly (game)

Our Banks need your help with the Credit Crunch, so do your bit by sending £1,000 notes to these distressed institutions. (Northern Rock are not accepted).

FT: UBS on a Trillion Dollar Meltdown

George Magnus was one of the first to speak of a Minsky Moment last year. Recons the US economy won't bounce back so quickly later this year. The only solution to this crisis is regulatory not liquidty. This guy seems to see things clearly, it is a pity UBS don't listen to their own advisers!

Posted by happyrenterz @ 09:48 PM 8 Comments

Chicago Tribune: This house was a steal

"The new buyers of a rundown graystone on the South Side showed up Jan. 9 to look at the house they won at a foreclosure auction. They took the plywood off the front door and went inside to make sure the utilities had been shut off. Then they called the police. Sitting upright in the corner of a bedroom off the kitchen was a human skeleton in a red tracksuit. Next to him lay a dead dog. Neighbors told police the corpse was almost certainly Randy Johnson, a middle-age man who lived alone in the North Kenwood house."

Times: Nationwide blow to first-time buyers

The Nationwide knows the market is on the way down and is increasing it's degree of comfort accordingly. "We have altered the tier structure for loans as part of our commitment to being a prudent and responsible lender and in response to the high cost of funding and a cooling housing market."

Posted by enuii @ 07:18 PM 8 Comments

Bloomberg.com: Stocks in U.S. Rally After S&P Affirms AAA Credit Ratings on MBIA, Ambac

Firesale of assets averted, for now. I wonder what it took to swing S&P around?? Was the deal struck with Washington to drop any inquiry into credit rating agencies' role in the sub-prime debacle in exchange for that politically and economically very precious AAA??

Posted by trough2010 @ 07:11 PM 7 Comments

Assetz: Buy to let looking bright for 2008

Buy-to-let investment in the UK is set to go from strength to strength in 2008, it has been suggested. Rental demand is increasing all the time, according to Mr Harrison of ARLA, who said the reasons behind this trend are "demographic". These factors include things such as increasing migration and rising divorce rates. "Traditionally, every time you have house price softening you get increased rental demand," Mr Harrison said. Last year saw the typical buy-to-let property rise by 10.9% to reach an average of £154,795, and Mr Harrison believes that this price will edge upwards.

Posted by little professor @ 05:49 PM 19 Comments