Monday, Dec 29, 2008
December 2008 Comedy Club Classic featured in today's FT
FT: 2009 house price bounce could be as steep as fall: NAEA
House prices could bounce back over the next 12 months just as strongly as the dramatic falls seen in recent months, the National Association of Estate Agents (NAEA) has predicted. Chief executive Peter Bolton King said strong market recovery in certain sectors could be seen during 2009, but only if three critical indicators occurred.
These include major lenders beginning to make money available to potential buyers, lenders passing cuts in interest rates on to the market and consumers regaining confidence in the state of the housing market if the market is to bounce back.
Posted by jack c @ 02:11 PM (2974 views) Add Comment
36 Comments
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1. inbreda said...
not to mention hell freezing over...
2. alan said...
Halifax have just improved their range of offers on Fixed Term. Offers are now including mortgages up to 95% LTV (up from 90% LTV).
Cosmetically, the Halifax situation indicates a brightening situation. Whether they actually lend out serious money in 2009 remains to be seen,
3. last_days_of_disco said...
@alan
Now that is interesting. This is the big push of the government, they are going for broke. Dropping LTVs is serious stuff in an environment like this, as discussed before here. It will be interesting to see the terms. Is that FTBs only? People re-mortgaging will need this just to stay alive next year. How long will HBOS last under the strain of the massive demand, or is this all part of the master plan to get everyone well and truly on the government teat.
4. Chilli said...
So in summary; Peter King is suggesting banks start loaning in the same spirit as the height of the boom in order to save estate agent jobs and therefore save the economy.
I would like to suggest that those estate agents get a real job. I fail to see how these guys can justify only selling one house a month or a week or whatever.
5. Maltesers said...
Yes , of course Mr P. Bolton ............this time next year i might be a millionaire.......mmmmmmmmmmmm
as inbrida said hell freezing over and Gordo could become a saint .ha ha ha ha ha ha
6. Ilejustwait said...
they must be dreaming, but then estate agents are fadeing away in the high streets, perhaps they fell asleep with no sales to deal with and woke up and thought this was all a nightmere,
( BUT THE TRUTH IS ITS FOR REAL ) HPC here we come big time 40% drop in next 2years,
7. Fly By Night said...
Is this some kind of competition where whoever tells the tallest tale gets a prize?
I could see pigs flying in 2009. I'm serious. Honest!
8. Andy said...
With inflation set to blow it's top with the weakened pound and quantative easing, then in monetary terms alone such a bounce might happen! I'm fearful that my hard earned deposit might be whittled away into inflationary oblivion.
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10. bystander said...
I hope they are wrong, as I need prices to fall by at least another 10% to make even the most basic accomodation affordable, and if the NAEA, RICS etc. keep on like this the vendors who may have been willing to accept lower offers may well bury their heads in the sand again, removing the chance of property transactions, causing a prolonging of the stalemate. This is hardl;y going to scare FTB's etc. into paying top dollar for a falling asset.
11. paul said...
Dead right, disco.
This is the government attempting to turn the ship into the prevailing wind, against the storm of repriced risk. When the whole world is taking a more realistic view of the risk presented by the UK housing market and the ability of its residents to repay, Brown is getting more and more out of it on a credit binge.
Debt is credit given by someone - it does not issue forth from some magical tap.
12. Browneconomy said...
If anyone from the NAEA reads this blog could I point out the (bleedin) obvious:
House prices are falling - the average should be around £120k (down from Nationwide's peak of £185k) a fall of 35% from peak to around 4.8x average earnings. When prices are at this level and FTB can see the bottom of the market then they will start buying again. Simple.
From the perspective of an EA trying to ramp a falling market results in (at best) some poor sucker catching (by buying) a falling knife. Or in reality as all the former (unemployed) EA's know too well NO sales, NO commission and NO jobs.
The NAEA would do better to act together and tell sellers the truth about where property is going and value property accordingly. Realistically priced properties are still selling (auctioned properties according to the media down 40%). Its just that sellers are deluding themseves about THEIR properties value because EA's are not telling them the score. The more the industry denies the harsh reality of todays market the harder the fall and the longer the recovery will be. In denying the truth EA's are ensuring a greater undershoot.
The problem is one of bvllsh1t, as an estate agent you can BS the media, BS the client, BS prospective buyers, BS the government BS everyone in fact - but with just one exception: you can't BS yourself. Their professional body and those with a vested interest in their industry must learn to understand this.
13. will said...
pigs might --- perhaps they meant the number of sales would rise, not prices.
14. jack c said...
@ alan ...Monday, December 29, 2008 02:31PM - just picking up on the point you made regarding Halifax - the only deals currently available at 95% LTV are for existing borrowers who are seeking a further advance or those wishing to take advantage of the Halifax product transfer option ie move from an existing Halifax deal which is expiring to another inhouse product - Tracker rates are 4.29% (£1499 arrangement fee) & 4.39% (£999 arrangement fee) to 30/04/2012 or Fixed rates 4.59% (£2499 arrangement fee) 4.99% (£1249 arrangement fee) again generally to 30/04/2012.
Lots of hot air and spin currently doing the rounds to try and re-inflate the market but IMO it simply wont happen despite Assetz, NAEA, Government and uncle tom cobbley all trying to dictate otherwise.
15. Mountain Goat said...
Mortgage securitisation is broken, so banks can't take loans off their balance sheets to free up capital. If this can be fixed then house prices might bounce back. I suspect this is the next rabbit to be pulled out of Central Bankers' hats, when they move on from trying to prevent the global financial system imploding. They will try use taxpayer money to prop up the housing market. As long as house prices keep falling we will have a guaranteed long-term recession IMO.
16. growler said...
Peter Bolton King: How do you figure this? who will sell the houses? 35,000 EAs have already lost their jobs? If the banks are in the middle of a major financial restructuring, do you think they'll lend money as carlessless as before - or more like ever again? Won't borrowers realise that interest rates can really only go up after 2010 - thus massively increasing the debt? And if people are so confident in houses "only going up" from now on, pray tell why we've moved from 11bn net equity withrawal to 5bn net equity repayment? Please don't insult the intelligence of your colleagues: People are skint, banks mauled, UK on the verge of unpredecented unemployment, holidays unaffordable until sterling recovers, UK economic growth will be at least -2% in 2009, wages will fall in real terms for those luky enough not to be made redundant - and we've got a huge stock of starter homes noone wants. Let alone all the legal action that's not even started re some of the more dubious property investment plans that have gone on!
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18. yorkshireman said...
Beautifully put Growler.
19. new user 2007 said...
I could get a 6.2-6.8 with a 20% deposit and a 4.3 income multiple.
The rates are uncompetitive.
The income multiple will not sustain the prices that followed after mid-2005 i.e. only ever higher multiples sustained prices after that.
Most people who entered the market since 2005 also no longer have equity of 20%.
20. new user 2007 said...
p.s. that was the largest possible income multiple on Halifax's mainstream products.
If a number of impossible events take place NAEA will be correct:)
21. gone-to-colombia said...
If I were the chief exec of the EA's I'd shut my mouth, retire to my shelter and quietly close the hatch.
22. crunchy said...
Yeah, I want a cheap house in a country which has been sold down the river.
Well done Gordo
Cheap house, Cheap country. Keep up the good work. Yeah Yeah!!!!!
Dont care where I live CHEAP HOUSE Yeah.
So cheap I can pay with my dole money.
Oh dear.
23. crunchy said...
I think most people here are going to and have already payed a lot more than money for your next home.
If prices went to zero you would not be compansated for the turmoil that awaits us.
24. crunchy said...
Keep juggling the figures guys while the take over moves on at a relentless pace.
Most of you will not even see it. Do you really think things will return to normal after this plays out.
It never does.
25. Yoss said...
Hey paying the mortgage with benefits is easy, my sisters mortgage is paid by the social and they aren't half as quick to realise interest rates have dropped!.
They are still paying the high rates even though the lenders rates have dropped base rates. So instead of paying the interest they are clearing the capital! At this rate she will be mortgage free in 8years a fact she's very proud of...Hell she might take 3 holidays next year rather than the usual 2!
26. paul said...
Not quite sure what the point you're trying to make is crunchy, the credit boom which just went past us represented a massive temporary transferral of wealth from the young and poor to the old and rich - a kind of icing-on-top supplement the pensions they've already stolen from future generations.
Things will almost certainly not reurn to what you might think of as normal - on that I can agree. The days of soaring property values and property pornstars gushing about marble worktops and alabaster alcoves are almost certainly gone.
The property market recovery is being bungled in a haze of estate agent incompetence, government self-interest, seller risk aversion and good old fashioned denial.
Welcome to the new reality, crunchy!
27. crunchy said...
23. paul
I agree to a degree, but I feel the change will be more profound. The "marble worktops and alabaster alcoves" I dont think will go completely It has been a very effective carrot and now a very established look. I cannot see an alternative that most would aspire too.
The change I think will come from the financial industry. Money expansion has almost ran its course. A cashless system must be on the cards soon which will take fiat money to a different level. That is why Global this and that is all we are hearing from Brown and Co.
You state that "the credit boom which just went past us represented a massive temporary transferral of wealth from the young and poor to the old and rich - a kind of icing-on-top supplement the pensions they've already stolen from future generations."
This part I cant work out yet. Surely this will have to be addressed in the near future for our economy to eventally move forward.
I think the answer is hidden somewhere in this new cashless system.
I agree strongly with Fred Harrisons slow but sure wins the race all round, however I dont think it is acceptable to most of the electorate or
the financial industry. I dont think the big banks have been hit as hard as most are led to believe.
I also do not see the bubble economy cycle being resolved just yet. I think that banks will just adapt. That is where the rub is.
28. growler said...
thanks Yorkshireman.
It just amazes me how the organisation representing estate agents allow a statement in their name no better than the researched and archived opinion of a school of babble fish. I would imagine the next thing we'll hear is a rewrite of "puff the magic dragon" just to show great social awareness!
29. Deeplyblue said...
Paul said:
"Not quite sure what the point you're trying to make is crunchy, the credit boom which just went past us represented a massive temporary transferral of wealth from the young and poor to the old and rich - a kind of icing-on-top supplement the pensions they've already stolen from future generations"
Yep, the old should remember that "the years of man are three score and ten." That doesn't mean you should live until you're 70, it means that if you do reach 70 you should damn well die (and without any expensive care bills, if you please) and let the state have all your pension rights and your children have all your cash.
db
30. crunchy said...
Paul, here is a link but there are lots more http://www.prophecynews.co.uk/content/view/272/2/
I dont think this system is that far away or outlandish. The finer points are another issue altogether.
31. beartil2010 said...
Crunchy - to understand the 'wealth transfer' aspects, you need to know about inflation and monetary supply, and how the central banks control them, causing the business/economic cycle of boom and bust.
It's well worth researching and understanding, it opened my eyes enormously!
32. crunchy said...
27. beartil2010
Thanks. I have done it. That is why I am so bloody cynical and doing cart wheels to keep my money.
33. Danhilt said...
Anyone see the last series of Alan Partidge he wrote a book called "bouncing back" I think he may of also writen this artical, his book ended up in a pulp !
34. Mr Messy said...
are these people on drugs ?????????? what planet are they on
35. Uncle Fargas said...
crunchy - what??? If you believe that revelations stuff - why are you bothering to hang on to your money?
36. crunchy said...
35. Uncle Fargas said...crunchy - what??? If you believe that revelations stuff - why are you bothering to hang on to your money?
Tuesday, December 30, 2008 09:26AM
I did not say that I believed in revelation, but I do believe that we are not that far away from a cashless system.
You need to do some more research Uncle Fargas and open that mind of yours a little.
Mastercard, veri chip. should get you started. Once you start to find "hard truths" your skin may start to crawl.
Oh Uncle, I like money!