Sunday, Jun 04, 2017

HPC gets a name check in the Grauniad


1. icarus said...

"When the report of that data was published on, the highest-rated response below the line was: “If you have a house for sale, drop the price because in six months it’s going to be a lot lower.” "

"...any significant fall in the market will provoke a “relief rally” of buying by those who have been desperate to get on the fabled ladder."

If people believe the former then the latter won't happen because they'll be waiting for prices to drop further.

And how does the reporter square the article headline with allowing the possibility of a "significant" fall. Prices dropping slowly but significantly? Why would that happen?

Sunday, June 4, 2017 02:44PM Report Comment

2. techieman said...

I can feel a "but but but" in the offing.

Icarus. ...I think there will be some kind of "relief rally" if there are falls of any consequence. The question then is whether the relief rally unwinds with a lunge to the downside. If it does then the prior comments of nothing to see here or good time to buy will evaporate into the pockets of missing bids.

It's interesting that the G reports on people being aware of prices lowering in the London boroughs. All (so far) against a backdrop of limited supply.

Sunday, June 4, 2017 03:16PM Report Comment

3. icarus said...

techie - describing the putative falls as "significant" or "of consequence" rather begs the question (in the old sense of that term). Almost by definition there will be a response from buyers if falls are big enough. The G rather undermines the tenor of its article, which was "don't expect quick or significant falls because the pent-up demand will soon kick in even if the falls"

Sunday, June 4, 2017 03:29PM Report Comment

4. britishblue said...

'the scale of the decline in home ownership among the young has been so dramatic that it has created a vast level of pent-up demand'.

This is pure speculation on the part of the writer. This isn't backed up by any research, where the simply question was asked if prices dropped by 5%, 10% or 20% would you be more likely to buy? Would it make no difference? Or would you be less likely to buy?

In the past there were many young people desperate to get on the ladder after a few years into their career. There are now many people in their 20's and early 30' who have resigned themselves to renting for ever. Therefore as prices go down they wont immediately jump in to buy and are just as likely to wait until prices are fair value.

Sunday, June 4, 2017 07:04PM Report Comment

5. sneaker said...

The first wave down: denial

Sunday, June 4, 2017 08:26PM Report Comment

6. nickb said...

Odd economic logic that equates a lack of effective demand to a vast level of "pent up" demand.

Monday, June 5, 2017 12:17PM Report Comment

7. icarus said...

Trouble with you lot is that you're outraged and dismayed (article1st para)

Monday, June 5, 2017 01:05PM Report Comment

8. mombers said...

There's pent up demand for homes requiring a £10k deposit. There's very little pent up demand for those requiring closer to £100k. Prices will have to fall a lot to unlock this pent up demand.

Monday, June 5, 2017 02:21PM Report Comment

9. nickb said...

I'm certainly penting my demand up for the time being. At least a year, I would say ... ;-)

Monday, June 5, 2017 02:49PM Report Comment

10. nickb said...

Interesting from the comments, an ex-poster calling themselves "Grumpygituk"

"The one warning I would give about as an ex disciple and recovering realist who was a prominent and prolific poster is that it has now totally lost it's purpose. The imminent property crash has now been approaching two decades since they started.

Many of the old posters lost fortunes waiting and more importantly never got on with their lives. And when anyone dare to suggest that maybe they called it wrong they were cast out, even respected members who had been their for years were banned on the spot for even showing the slightest doubt in their ideology. The site should be more clear in it's purpose, something on the lines of "we hope for a property crash but it is unlikely"

Can anyone think of a former 'prolific poster' that might self identify as a grumpy git? ;-)


Monday, June 5, 2017 02:54PM Report Comment

11. nickb said...

I hereby doubt that UK house prices will ever fall. Waiting for the mods to kick me out!

Monday, June 5, 2017 02:55PM Report Comment

12. libertas said...

sneaker said...
"The first wave down: denial"
And if you get sucked into bear traps throughout a bull market, expect to get sucked into the final peak as all the bears capitulate only to get wiped out. In fact, a sustained bull market requires corrections and is a sign of a healthy market. Clearly, the top will see all parts of the UK hitting all time highs along with other markets like the US being above average, whereas the national average is not yet much above 2007 levels, with prices still well below the long term inflation adjusted average, and America is only just hitting 2007 highs. Thus I believe we are still in an embryonic bull market with the peak some years away.

Monday, June 5, 2017 11:27PM Report Comment

13. stillthinking said...

House prices -would- have crashed back in 2007/8 without massive government intervention in the market, which nobody was expecting. So any attempt to predict prices based on government inaction seems pretty futile to me. The UK is not going to increase interest rates. Inflation as measured in gold from 1977 to today is a tad over 6% per annum, in the decade 2007-2017 the supposed great deflation alarm its a tad over 3%. Housing is a tax free asset pretty much.
I have been on and off this site for ten years and I think it moved on from housing to economics and was a great introduction for me, but the price of housing in the UK is obviously set by the government. Suppose the government reintroduces MIRAS for example. You could reasonably enough, debate about the -real- value of housing, in which case you could see the 2007 crash easily enough ( but if you aren't dealing with nominal values then whats the point, and its nominal values that matter for housing because the real value of your debt can go down by dictate.

Tuesday, June 6, 2017 03:14AM Report Comment

14. nickb said...

Not sure I understand what you mean about it being nominal values that count. Nominal values are crucial but only because of their link to real values. For example, if the value of your debt changes, this matters because of your ability to pay, set by your income and opportunity costs of servicing debt. Those are real factors. We can see the crash in 2007/2008 in real values, discounting inflation, as you say.

Tuesday, June 6, 2017 10:34AM Report Comment

15. techieman said...

Nick.... it's my old handbags at dawn chum...the pick n mix king. 😉

Sunday, June 18, 2017 09:19PM Report Comment

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