Monday, Feb 15, 2010
The bulls are alive with the sound of music ...
Express: HOUSE PRICES ROCKET BY £7,000 IN JUST ONE MONTH
"HOUSE prices have risen by more than £7,000 this month, but experts are cautious of suggesting the property market could be heading for another boom. February’s 3.2 per cent rise pushed a typical three bedroom semi to £229,398 – a £7,137 increase in just four weeks." They have'nt got away. We're still the economic outcasts.
Posted by quiet guy @ 02:18 AM (1998 views) Add Comment
22 Comments
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1. Sb said...
Erm, aren't we only half way through February? Have the Daily Express become psychic?!
2. taffee said...
unbelievable.....uk has some of the worst finances in the world and the most expensive property...how on earth are house prices going up?
At some point there is going to be an incredible crash imo and a slump that will feed on itself for decades
simple economics say so.
3. matt_the_hat said...
After all that has happened how can anyone think this is good news
4. mrflibble said...
Seven grand a month - sounds like a get rich quick scheme to me.
Lets look at this 'gain' another way, the average house is £160k, last month GBP/USD was 1.63, today it is 1.56, hence the global buying power of £160k has now been reduced by £6871 over the same period UK house prices have risen £7000.
There is no free lunch, our housing boom is over, we are now crashing, if house prices don't give then something else will. The UK is a fools paradise at the minute where the vast majority seem to think this country is somehow different to the rest of the world. The only difference I'm seeing is in the total number of idiots who seem to believe high house prices are a good thing.
5. Thecountofnowhere said...
Is this asking prices ?
Gotta laugh if it is, asking prices and sold prices are in two different sollar systems at the moment.
6. theboltonfury said...
this is right move asking prices?
7. Expat said...
If you look at the detailed statistics provided by Rightmove on this subject you'll see that the majority of increases occurred in poorer housing areas such as Wales, the Midlands and the North, prices in the South West actually fell!
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9. paul said...
The Bank of England will be over the moon.
10. The Baldman said...
Stuart law and rightmove ramping story total fantasy
11. layers said...
If we weren't living in Alice in Wonderland world, this would be good news in the sense that the BoE would have to raise IRs drastically and quickly to stop this new bubble forming. However, as we are, then they won't and so the BS continues and those VIs continue to sleep well at night.
12. freemanphil said...
Good gracious. If this is true, we could be seeing hyperinflation. I read this weekend about some store items going up close to 50% in price. Chain stores built on debt/sand, will have to fund higher costs for debt via higher prices. This doesn't look pretty.
13. jack c said...
The Express again with it's Grand Old Duke of York house price headline (when they are up they are up....and oh they can go down....and when they are only half way up....they are neither up nor down)
This from todays Moneyfacts to help keep things in perspective
Lenders are continuing to pick and choose their customers by reducing mortgage rates only for those with significant amounts of equity, the latest research from Moneyfacts has revealed. Although fixed mortgage rates were found to be falling, they were only doing so for those with decent deposits. By contrast, the rates available to those borrowers with small deposits were actually increasing. The average two year fixed rate for a borrower with a 10% deposit has increased steadily since April 2009, now standing at 6.48%, the highest level since December 2008. However, the average rate for a borrower with a 25% deposit now stands is 4.27%, the lowest level since July 2009. Over a term of two years, this means that a borrower with a 10% down payment will pay £4,728 more than one with 25%. "While lenders are slowly increasing the number of deals available to those with a small deposit, which should be good news for first time buyers, they continue to make them pay a heavy price," said Michelle Slade, spokesperson for Moneyfacts. "Lenders continue to cherry pick the best customers and appear to be actively discouraging borrowers with a small deposit from remortgaging. First time buyers are being offered little incentive to enter the market and there are no real signs of things getting better for them anytime soon."
14. mark wadsworth said...
Hurray! We are all saved and we can all be rich again without having to work or save! Because as we know, Home-Owner-Ism is fundamentally opposed to the idea of working and creating wealth and saving and investing (and investing in turn increases output capacity, so there's more work and more wealth creation and more money to be saved and so on in a virtuous circle). In its end result, Home-Owner-Ism is a bit like Socialism, only without the good bits*.
Re what Jack C says, here's me favourite calculation again, assuming house costs £100,000.
Buyer 1, has deposit £25,000, borrows £75,000, pays 4.27% interest = £3,202 a year interest.
Buyer 2, has deposit £10,000, borrows £90,000 pays 6.48% interest = £5,832 a year interest.
So subtracting 1 from 2, that extra £15,000 borrowing costs Buyer 2 an extra £1,821 a year in interest, an effective marginal rate of just over 12%.
If anybody genuinely believes that house prices will go up by more than 12% year on year, they need their heads examining (even if paper capital gains were a source of income, which they aren't).
* The best thing about Socialism is that it tends to go bankrupt (morally and financially) and collapse after a few decades - Home-Owner-Ism is self-perpetuating down the centuries and if anything it's getting worse, not better. It's the perfect self-perpetuating system, just like in "1984".
15. mark wadsworth said...
"my", not "me", obviously.
16. This comment has been removed as it was found to be in breach of our Blog Policies.
17. matt_the_hat said...
9. mark wadsworth - yes but prices don't just go up on the marginal borrowing part - maybe you need to get another favourite
18. mark wadsworth said...
MTH, that thought occurred to me as soon as I'd posted. So ignore that bit. The 12% effective rate still stands though.
19. maddison said...
It still goes to show that house ownership is for the well off. In case you hadn't noticed it is the well off that have been least affected by this recession.
20. icarus said...
layers 6 said "if we weren't living in an Alice in Wonderland world". Ah, but we are. Remember the caucus race - everybody wins so everybody gets a sugar-coated sweet. In the end, though, Alice realises everybody is a playing card and the whole thing was just a dream.
21. Luvit said...
usual clique moaning about house prices!!
22. icarus said...
Luvit - would you expect a discussion of baroque music instead on housepricecrash.co.uk?