Saturday, May 27, 2017

... But but but... Enfield still looking good ??

Business Insider: House prices in London are being cut as the once-crazy market continues to cool

The number of asking-price reductions is growing fastest in outer London boroughs like Barking & Dagenham, where 28% of homes were discounted compared to 21% in January, and Newham, where 24.5% had reductions compared to 20% in January.

Posted by techieman @ 06:16 PM (7565 views) Add Comment


1. libertas said...

YES indeed. Enfield is looking GREAT right now, particularly east Enfield.

Most recent ONS statistics put it at 5.7% annual growth. Should breach the £400k average barrier some time this year. The lion's share of the growth appears to be in the east of the borough and Enfield Town, where London Overground put it on the Central London Tube Map for the first time in May 2015. Still playing catchup, because that line takes people through Hackney and Tottenham where may are being priced out. Other parts in the west like Southgate, Oakwood, Palmers Green, Winchmore Hill already have mature, middle to upper class housing markets that nonetheless are strengthening due also to overspill from more expensive Hackney, Haringey, Islington and Barnet.

The previous Hackney and City exodus from young professionals seeking lower rents or their first home was to Walthamstow due to the Victoria Line, but that has already become unaffordable, whereas the north of Tottenham and the whole of Edmonton remains the sole affordable part of north east London. These parts do not require general house price inflation to rise because they are in the process of an upwards correction as they come into the consciousness of those who seek to be in London but want a lower cost of living. The same process happened to Hackney in 2008 when London Overground took over Silverlink's North London Line, and you saw it happen to Peckham and the line between Canada Water and Croydon / Crystal Palace also.

Crossrail 2 is looking dead in the water and London Overground is enough, so Edmonton, Tottenham, Enfield, Walthamstow and Chingford do not need it, but if it gets approved later this year, expect a massive surge in interest because, for example, a place like Ponders End, presently, which will also be a feeder station for Chingford, is 30mins from Oxford Circus with 2 trains per hour, which will be reduced to a 20mins journey with no changes and 16 trains per hour.

Monday, May 29, 2017 10:24AM Report Comment

2. techieman said...

Great Libby, enjoy those unrealised gains.

I often use Highams Park when the central line is farquaharsened, I was rummaging through connault waters the other day when I spotted the very rare Septum absent Westbrook frolicking in the bushes, close to the QE lodge,

Nothing can hold enfield back now... 20 / 30 times average earnings in plain sight.... "upwards correction"... only you could come outwith that one :). Good luck.

Monday, May 29, 2017 04:43PM Report Comment

3. libertas said...

To quantify it, the average house in Edmonton is heading towards about £600k to equal that around places like Forest Hill, also on London Overground and in a similar zone. Chingford and Highams Park have done very well also and are rising to close the gap with areas around the Central Line, again, due to London Overground.

This phenomenon is well documented everywhere else TfL took over train lines putting places on the Central London Tube Map.

Monday, May 29, 2017 09:30PM Report Comment

4. icarus said...

If most of NE London is unaffordable (para 3 @1) the pressure must be for a downward correction for NE London as a whole, not pressure for an 'upwards correction' to those parts of the NE which are still affordable. And you'd think they'd be only barely affordable if they are surrounded by unaffordable areas.

Monday, May 29, 2017 09:54PM Report Comment

5. libertas said...

icarus, that would be true, but for the fact that when West Anglia rail got taken over by TFL, it gained the most coveted real estate marketing tool in London, a place on the Central London Tube Map, that previously in this area had been limited to areas adjacent to the Picadilly and Victoria Line. Furthermore, fares were slashed and London Overground has a long history of vastly enhancing services. New trains and additional services come online in 2018 in these areas and service levels will be progressively enhanced.

Every time this has ever happened so far, the area has risen to close gaps with other areas. Peckham is a great example, because its prices were low before London Overground reached there, but it is now not a million miles away from prices in places like Clapham, whereas Clapham used to be more than double the cost of Peckham. Same is happening with Tottenham, Edmonton, Enfield Town and Chingford right now, where Tottenham is playing catch up with north Hackney, with Edmonton following swiftly behind, Enfield Town is catching up with places like Southgate and Chingford is playing catchup with Woodford.

BTW, whereas house price inflation has slowed, it has not reversed. Prices are still rising. How else can London accommodate another 1.5 million people, which is what is being planned? No, rather than get more affordable, people are reducing their expectations, buying a 1 bed rather than a 2 bed flat. We are returning in some way to Victorian overcrowding, particularly for illegal immigrants who cannot get legitimate housing now.

Monday, May 29, 2017 11:30PM Report Comment

6. icarus said...

libertas - But then see britishblue's comments to sneaker's post of 24th May @9.59am.

Tuesday, May 30, 2017 08:22AM Report Comment

7. techieman said...

Icarus. ... I'm not sure they are still affordable , more likely less unaffordable.

Tuesday, May 30, 2017 08:42AM Report Comment

8. libertas said...

I only saw posts about commercial real estate.

Look, if you cannot accept that there are markets within markets and are not aware of the impact infrastructure has on house prices, I really cannot help you. As a tip, next places too soar are those on the Crossrail route not yet on the Central London Tube Map, including Abbey Wood and places east of Padding such as Hayes and Harlington, Slough, etc. Because whereas investors have front run the investment, renters only flock there once the route opens.

Tuesday, May 30, 2017 08:45AM Report Comment

9. icarus said...

techie, I was tempted to put it like that.

libertas, look again, bb's posts were about residential property. He happened to mention that the conversion of offices to flats was 'down to a dribble'.

Tuesday, May 30, 2017 09:25AM Report Comment

10. techieman said...

Libby , I wonder if you can help me ?

Why is HPI reducing at all, given the millions of migrants front running Brexit. ....Are they sidelined waiting for Jerry to unilaterally secure them or Teresa bi- laterally securing their rights to stay?

Tuesday, May 30, 2017 01:38PM Report Comment

11. libertas said...

Icarus, office to residential conversions are down because the shift has created shortages of offices and higher prices for them. A glut of unsaleable offices has been converted, ending a market log jam, this is not a fundamental market shift.

HPI could be reducing because shortages are resulting in lower sales volumes. We could be seeing the beginning of volatility nationwide of the sort Normally only seen in the City of London.

Tuesday, May 30, 2017 07:48PM Report Comment

12. icarus said...

libertas - I mentioned office conversions only to show that bb's posts were concentrated on residential, not commercial, markets, given that you wrote that his posts concerned just the commercial market. Let's not stray from the main point.

Lower sales volumes are indicative of a cooling market, and price levels in such a market should not be equated with price levels in a high-volume market (sellers holding back in the former because they can't get the prices for which they were hoping, rather than a supply shortage, with its connotation of upward pressure on prices).

Tuesday, May 30, 2017 08:10PM Report Comment

13. techieman said...

I think the point you are making Libby is that gains are accentuated or losses attenuated by infrastructure improvements.
Yep we get it. Indeed there have been many discussions about why the tax payer should pay for a select few to benefit via higher property prices . Harrison 's LVT springs to mind.

BUT the question is the underlying market. I've had a look at rightmove recently and am struck by the number of reductions and the apparent lack of interest.

Of course it's often a mistake to extrapolate increases on a linear basis. I'm sure that crossrail will benefit a number of areas. BUT that might just mean a reduced level of losses rather than an increased level of "profit".

Tuesday, May 30, 2017 08:44PM Report Comment

14. libertas said...

Cyclically, we tend to follow America. It is just breaching its 2007 high. This bull market remains embryonic.

Wednesday, May 31, 2017 04:43PM Report Comment

15. icarus said...

How can we talk about 'cycles' when so much is manipulated? See the M Hudson article I posted immediately below. In the US real people have been forced out of house ownership and now they can't get the NINJA/liar loans they were getting 10-15 yrs ago and can barely afford to rent. Since 2008 Hedge Funds have bought up a large % of the 10m foreclosed residences with free money and forced up the rents on those properties through their local monopoly positions. Now there's much less property available to buy or to rent. One major reason for this is that banks have moved from NINJA residential loans on to another scam - government-guaranteed NINJA student loans. And again, house prices are supported by the leanness of the market.

Wednesday, May 31, 2017 08:43PM Report Comment

16. libertas said...

Icarus, you can speak of cycles with manipulation if you understand that manipulators can only manipulate for a limited period until they capitulate to market forces, ensuring that the market manipulators are simply traders and part what fuels the cycle. Martin Armstrong certainly takes this point of view.

Personally, I think we are about half way or two thirds of the way through this bull market that began in 2008, taking it to 2023 to 2026 in my opinion, with peaks and troughs along the way. We have been under the long term average since around 2009 for goodness sakes, and remain there still!

Trumps withdrawal from the Paris agreement, really signals that USA is ready to emerge from the Communist world government that has been holding back standards of living for so long. This, tax cuts, deregulation, etc. is combining with the DJIA showing mega strength (Next step 28k), with the USDX coiled for a surge (reducing commodity prices for all), and we will be tied to the hip to this resurgence with an omnibus trade deal to be signed in less than 2yrs time, literally the day that we leave the European Union.

Meanwhile, Britain retains its founding member seat on the World Trade Organisation, as co-equal to the USA, and if Theresa wins, we will literally follow USA towards low tax, high employment, dynamic growth and you will likely see 90% of world patents being produced by USA and UK, with us experiencing the greatest boom of history as resources shift from Socialism to harnessing all the new technology coming forward in terms of computing, networking, robotics, nano-tech, etc. etc.

As the undisputed capital of European finance, London, free to sell financial services to America and Europe will go absolutely nuts and the construction boom you've seen so far will pale in significance to what we are about to witness. For example, Canary Wharf is seeking to double its commercial floorspace, the City of London has pipeline development for probably 100,000 new jobs and is actively seeking a new tall buildings cluster between the Scalpel and the Walkie Talkie tower. What is not spoken of is that all European banks, etc. will seek offices in London to seek access to American markets.

Thursday, June 1, 2017 10:49PM Report Comment

17. techieman said...

Libby I'm not sure why you are referencing Armstrong. His economic confidence model doesn't support your 18 year cycle.

If you review his comments on London, Vancover and the "core" us cities you will find him bearish.

Icarus I've read Keens book and went to a seminar he did at Golds. A student raised HPI and Keen was non committal on it. Although he did say that the movement of capital in and out of London was a main factor for London prices.

As you know effectively he believes that the loss of acceleration in lending , can, all being equal, lead to downward pressure on house prices.

Libby I'm sure you know that the Empire State building was built just as the US entered the depression, so I'm not so sure your confidence that building something means that it is automatically fillable.

The cheese grater for example was planned and building work stopped for a number of years before it was finished.

Friday, June 2, 2017 06:54AM Report Comment

18. nickb said...

Damn it, Libby is right and he called it years ago. I'm going "All In" for Enfield. Now is clearly the time to buy with all the signs of the imminent upward correction.

Friday, June 2, 2017 05:16PM Report Comment

19. libertas said...

Nickb , not so fast. The major correction upwards already happened the 12 months after London Overground came, May 2015. Houses gained over 100k. Drifting up now but not as quickly. Next jump area are Crossrail stations not yet on the tube map. Abbey Wood and stations west of Paddington.

Friday, June 2, 2017 08:11PM Report Comment

20. icarus said...

libertas @ 16 - no point in responding to all that stuff. World Communist Government indeed. The DJIA (Dow Jones) is a good example of long-term manipulation trumping 'fundamentals' or 'market forces' - high stock prices are the result of stock buybacks (worth $ half a trillion a year) and M&As with borrowed near-free money and the subsequent looting of companies and pension funds (or selling corporate bonds to under-pressure pension funds to boost stock prices) to pay back the loan. Execs are the only gainers. Instead of more Capex they look for the quick fix, i.e., load up on debt, buy more shares, boost the stock price and Why do you think there is so much poverty, homelessness and food banks around the world if stockmarkets are humming?

Trump and climate (Big Orange says "It's called 'weather'"?) Have you seen the state of melting of the Arctic and Antarctic lately and sea-level rise? Ask Miami Beach residents The reason we're sleeping on this one is that the oceans have absorbed most of the acidification and heating -but it's not locked away there. And already the bottom of the ocean food chain is thinning out. What do you know about the 'Big Burp' of methane gas from eastern Siberia that could easily happen with more ice melting?

As for 'Theresa' and de-regulation ask her why she's a water-carrier for Monsanto with its poisons and destruction of rural life in poor countries. And as Home Secretary what did she know about the 'Manchester Boys', the jihadist group to which the Manchester bomber belonged and which was used as MI5 assets to help overthrow Ghadaffi and to join jihadist groups in Syria? Under her watch these guys were given freedom from the control orders under which they were kept and allowed passports and freedom from airport controls to go to Libya. The bomber was also on FBI radar last year and the FBI warned MI5 that his group (forget the 'lone bomber' bit) was planning a UK attack. As Home Sec and PM she has a lot to answer for.

techie - my reference to SK's book was a few posts ago. For me the important bit was the idea that you can keep an economy (and asset prices) afloat with more and more debt - until you can't, by which time it's getting too late to fix it. Like global warming.

Friday, June 2, 2017 08:42PM Report Comment

21. crash bandicoot said...

I know if you look hard enough you can find these sort of reports about most places but this one caught my eye a couple of months ago.

I have no idea whether this is correct as I've never been to the place, but it wasn't what I was expecting from what I'd read on here.

Friday, June 2, 2017 10:08PM Report Comment

22. techieman said...

Crash.... are Libby's neighbours contributors to that article ?
Icarus. .. I e always wondered with Keen what is the optimum level of debt to GDP ? In the aggregate (private ÷ govrrnment) as a percentage of GDP. I don't think I've ever heard him comment or be asked.

Friday, June 2, 2017 10:20PM Report Comment

23. icarus said...

techie @22 - A key concept he uses is debt deflation in which payments to creditors (including mortgages) leave too little income available to spend on goods and services so that the economy is stifled, along with employment and wages. You'd have to take into account other outgoings such as rent and taxes and austerity measures (also connected to debt) reducing welfare. Then there's budget deficits (which to him provide the economy with money) or surpluses (which suck money out of the economy). So debt is a large part of the overhead stifling economies and an optimum level of debt/GDP would be identified on this kind of basis.

Saturday, June 3, 2017 08:43AM Report Comment

24. nickb said...

Sorry did not know you were immune to irony. Won't try it again.

Monday, June 5, 2017 12:13PM Report Comment

25. libertas said...

nickb, I did not know that you were so sensitive. I shan't try to counter your sarcasm again, even if it does betray a point of view that deserves response.

Monday, June 5, 2017 11:22PM Report Comment

26. nickb said...

Oh, my bad! I didn't realise you were being ironic! Really no worries, I enjoy all this immensely and am not quick to take offense ;-)

Tuesday, June 6, 2017 10:29AM Report Comment

27. libertas said...


Tuesday, June 6, 2017 11:01PM Report Comment

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