Wednesday, Apr 01, 2009
It's not over yet
Daily Mail: Homeowners face further falls in prices
House prices in Britain have nowhere near bottomed out even after a 20 per cent dive, the Organisation for Economic Cooperation and Development warned yesterday.
Property values are still 140 per cent of their historic averages, suggesting further declines are unavoidable, the Paris forecaster warned.
Economist Petar Vujanovic of the OECD said: 'Affordability is still nowhere near back at what it has been historically. So we think it has got a way to go."
Posted by little professor @ 02:21 AM (1900 views) Add Comment
18 Comments
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1. magnifico said...
Why are Nationwide dragging their feet with the HPI figures for march?
2. george monsoon said...
Quote ~ "property values are still 140% of historic values" - The sellers really need to wake up to this.
I still can't understand why houses are being valued at 2007 prices ??? In this climate you would imagine that Estate Agents would be chasing the market down, not putting up the blinkers and wondering why their business is going down the toilet.. (It looks like its not just monetary policy that has a period of lagg, its the V.I. spin from 2007.. still waiting to filter through those tiny E.A. brains)
Does anyone know if the FSA are pushing ahead with the cap on 3 x salary lending ? We need this to force the V.I.s hand.
3. Sybil13 said...
2 Questions above
Magnifico - someone said on the forum that the government had given Nationwide 1.6 billion this week with Dumferline to lie about the figures!
George Monsoon - Lord Turner said he would cap at 3'x's to stop property prices inflating if lenders started to lend irresponsibly . He said it was a better measure of sustainability. But a thread today about G20 said they were talking about capping LTVs if and when prices start to inflate, clearly loan to incomes is, as Lord Turner said, a better measure. CML said that the current average is 3x's and it seems to be working. I clicked 100 pages of Rightmove last night and not ONE "under offer" let alone "sale agreed".
4. matt_the_hat said...
oes anyone know if the FSA are pushing ahead with the cap on 3 x salary lending ? We need this to force the V.I.s hand.
I think GB or one of his cronies will write a report for Sept/Oct, then with the money wasted writing that it will be shelved
5. mander said...
I agree with George. Estate agents are the problem. When will they finally understand that there is no going back to 2007.
Soon we may see buy one get one free offer from them.
6. waitingfor hpc said...
i agree i looked at a house up for £695K, in 2007 they mortaged @£605K, I offered them £495K for a quick cash sales ...... and the agent said it was too low, they have since had 3 open days at the house and it is still not sold and have dropped the price to £660K.
I have decided to hold my money and wait 1/2 years before entering the market when agents get real!! The agent took the p*ss out of me on the phone saying ' oh - your the guy who thinks the housing market is going to crash and so are making stupid offers'!!!
He then refused to show me around any other homes as 'i would make silly offers that would not be accepted'.
Not to name names but Location Chelmsford ... you need to get in the REAL world.
http://www.location-chelmsford.com/
7. will said...
and once the indexes have fallen, then just maybe folk will realise that the falls apply to them too, and estate agents who live in denial will have to force their client's property down, rather than letting them advertise at 2007 peak prices.
8. tyrellcorporation said...
I went into an EA a few months ago and asked about the market in Exeter. As tumbleweed blew across the carpet one dizzy girl piped up and started to give me a reasonable assessment of the market by saying it was worth just putting in some low offers on things I liked (incredible strategy I'd never even comtemplated!). She was quickly interrupted by a gnarled old battleaxe who appeared from knowhere who rather aggresivley stated that the market was booming and 'they'd even had a recent gazumping' (as if that's a good thing!!!).
EAs are still not of this World and the vast majority need to go out of business.
9. little professor said...
OECD in 2006:
Homeowners can breathe a sigh of relief - the UK housing market is now less likely to crash than most other Western countries, according to authoritative new research.
The probability of a house price correction in Britain is now barely one-in-twenty, even if the Bank of England hikes up interest rates in the coming years.
The research, from the Organisation for Economic Co-operation and Development, shows how the recent "soft landing" engineered by the Bank of England has dramatically reduced the danger of a potential crash.
Using complex economic tools, the Paris-based OECD discovered that the probability of house prices "peaking", or slumping, is currently only 4.6%
10. mark wadsworth said...
Yippee and hooray!!!
The very nice house next door but one from us that was up for sale for £795,000 for the past year was sold a few weeks ago for £600,000 (according to houseprices.co.uk). That's still up from the £515,000 they paid for it in early 2005, but hey...
Interestingly, the people in the identical house next door were holding out for £770,000 (which might just have been achievable in 2007) for nearly a year, they have now dropped this to £685,000.
How about £550,000, you st1nkers? Call it £450,000 and we might just put in an offer ...
11. george monsoon said...
The email address for the OECD is news.contact@oecd.org if anyone is interested in asking them a question about their 2006 report
12. Doomwatch said...
tyrellcorporation, was the battle axe Annie Ashworble in drag ? :)
13. stillthinking said...
Yeah it is strange that estate agents seem to be talking up the market at the expense of volumes. Maybe for many of them unless they get a slice at old prices they can't pay their costs.
14. growler said...
@ 8; Little Professor: I have to say, I laughed out loud when I read that. Well spotted.
OECD have in my mind been reasonable in the past, but now are more about appeasement reports from an agenda I don't fully understand yet.
@ 5: It's not just Chelmsford, there are blatantly useless agents here in Beaconsfield. There is a house to rent not far from me. The sign has been down for 3 months and is almost part of the muddy path. The house is empty since October and the agent STILL has it adevrtised as a flat, not a house. I think if I was the Landlord, there would be a very "frosty" conversation. Other agents are still "ramping tons" with houses marked "similar required" and "POA" when there used to be prices being stock in trade for their RightMove advertisements. I can't imagine that they've been disinstructed and are wishing to market themselves otherwise...
Houses off the market for 3 months are now coming back on at -15% asking price from before. The house-prices site is also revealign the truth about prices. If you look at it every day or two, you know exactly what house was advertised for what - and what it actually went for.
I see no sign of a bottom to the market here.
15. Puppee said...
so houses are still 40% overvalued so according to this 50 to 60% from peak is about right i said all along 50% about right back to year 2000/ 01 prices as for the 3x cap the banks are already enforcing it on their own as they will not want to risk anything like this happening again, it would just be good if it was made official so it would speed things up as if this plays out for another couple a years things could be worse as alot more jobs and companies would be lost never to return , the quicker this govt realises this the better it will turn out
16. sold out said...
watingfor hpc @11.42am
hi i am renting and looking to buy in Chelmsford.
but not in Beaulieu Park, bit too expensive for me.Who was the agent you was dealing with?
Prices are still too high but only because of their (sellers) denial phase is not over yet.
I noticed a new build in old moulsham just sold for 279k was 370k when it came on the market 18months ago.
Did you see that feature in the chronicle the other week about the housing market in Chelmsford?
Basically a load of EA tosh, i will see if i can find it online and post it for a giggle.
17. Mr Rigsby said...
waitingforhpc and sold out,
Yeah, I just checked out that house in Beaulieu Park on the site. A very nicely presented house and probbaly worth £450K to £475K of anyones money. Also sent the EA a nice long email telling him why waitingforhpc was right to offer the £495K, I wonder if I will get a reply or are they too busy showing houses......
18. Miss Ria said...
Hi All, I'm looking to buy a house in the chelmsford area within the next year or so - I am a first time buyer and was looking at houses in the beaulieu park area, found a house for 299K but as that is almost 100K over my budget thought I'de have to win the lottery first for that one :-). I am not sure what other area (nice) could be considered as I am not from the area. Any suggestions - preferably like to be in the west side of chelmsford. Thanx.