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strbear

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Posts posted by strbear

  1. FEARS that Yorkshire cities are being swamped by flat developments have prompted urgent talks to head-off a possible crisis in the region's property market.

    A review is due to be conducted in the New Year to establish Yorkshire's housing needs over concerns that a glut of apartment developments is saturating the market.

    The Yorkshire and Humber Assembly, which is charged with overseeing the region's housing strategy, will spearhead the review, which will involve talks with local planning authorities and developers.

    Concerns are growing that the Government's controversial plans to build 22,000 homes a year in the region will not be met if the property market is destabilised by an excess of flats for sale.

    From the YP yesterday - there really are some switched on cookies out there looking after our interests!

    SB

  2. Goldman Sachs has changed tack dramatically on the US economy, predicting that the Federal Reserve will have to slash interest rates to 3pc by the middle of next year to head off recession.

    The bank’s chief economist, Jan Hatzius, said US house prices were likely to fall 15pc from peak to trough, leaving a fifth of the country’s homeowners with $3,000bn in negative equity.

    Well thats not so bad then . . . . . . it could have been serious

    http://www.telegraph.co.uk/money/main.jhtm...ccusecon128.xml

    Regards

    SB

  3. Well interesting to say the least.

    The biggest issue (which hadn't really occured to me before) is that a lot of people coming off ARMs (ie needing to refinance) are unable to get new mortgages as their property has fallen in value and they no longer have the LTV to qualify for a loan on their existing property - ouch, and its pretty common apparently in LA and Orange County because people took such high risk mortgages. Its a big talking point here right now and everyone only sees it as getting worse as more ARMs reset.

    Everyone accepts that house prices are falling - 10 - 15% seems the main assumption - and many people are calling the bottom - but many commentators perceive the above issue means there is a long way to go. One of the top realtors (Estate Agents) in the San Fernando Valley told the local conference of realtors that if they had any other skills now would be a good time to put them to use as for the next 5 years there wouldn't be the money in real estate their previously had been - pretty telling I suspect.

    And everywhere there are new builds up for grabs - $500K for houses that were $750K 6 months ago is common - in fact in Orange County there is a housebuilders blowout event next week to try and shift their inventory - should be interesting.

    Well thats about it - time to go out for dinner - I know lots of people think our economy is disconnected from the USA's but I have to say I think I'm seeing the future here - it will be the same in the UK in about 6 months time.

    Njoy - and have a nice day!

    Regards

    SB

  4. Article in the WSJ today;

    Home prices in some of Europe's hottest markets are falling after a decade of double-digit-percentage price increases. The reasons resemble those across the Atlantic: higher interest rates, faltering confidence and tighter lending standards.

    "A year ago it was all, 'no problem,' but now they're making us jump through hoops," said Iciar Caro, a 29-year-old school psychologist in Spain who can't find a bank to give her a mortgage on a €236,000 ($337,000) house in a northern suburb of Madrid.

    Now we're international news!

    http://online.wsj.com/article/SB1192999309...p_us_whats_news

    SB

  5. The admission by leading institutions of inadequate management of financial risks came as investors braced themselves for the reopening of equity markets on both sides of the Atlantic after Friday’s brutal sell-off on Wall Street. The plunge in American shares came on the twentieth anniversary of the Black Monday crash and wiped 366 points off the Dow Jones industrial average, marking Wall Street’s worst week for three months and reigniting fears over fall-out from the global credit squeeze.

    [sarcasm on]But the fundamentals are still sound! [sarcasm off]

    Njoy

    SB

    http://business.timesonline.co.uk/tol/busi...icle2709683.ece

  6. Bank of America results out today

    Its capital markets division, which includes credit and structured products, fell into the red, as a $298 million gain in the same quarter last year became a $717 million loss in the three months to September 30.

    For those who think this is all over - think again,

    http://business.timesonline.co.uk/tol/busi...icle2687542.ece

    Regards

    SB

  7. JP Morgan Chase became the latest bank to outline the impact of the credit crunch, taking a $1.6bn (£788m) hit to cover positions in leveraged loans and mortgages.

    JP Morgan Chase write-off included $1.3bn of leveraged loans and unfunded commitments

    The banking group, which owns investment bank JP Morgan and retail bank Chase, took the action as it reported a 3pc rise in third-quarter profits to $3.4bn in the period to September.

    JP Morgan Chase write-off included $1.3bn of leveraged loans and unfunded commitments, and a $306m increase in reserves for home mortgages.

    Starting to look more bearish everyday

    http://www.telegraph.co.uk/money/main.jhtm...cnmorgan118.xml

    Regards

    SB

  8. And the snowballing effect on overall prices is being felt. Tomora Tonioli, with Keller Williams Realty, Norco, and a real estate investor herself, has been eyeing a Lennar home in Riverside County's Corona Valley. A year ago, this model sold for $769,000. Now, it's been discounted to $575,000 with $40,000 in incentives on top of that.
    Locally, Delores Conway, director of USC's Casden Real Estate Economics Forecast, points to Riverside County as ground zero -- a place that was overbuilt, with new homes now being discounted by builders, and that is witnessing a sea of foreclosed homes on the market, with more expected. RealtyTrac reported last week that Riverside County led the state in foreclosure activity with one in every 330 households affected. Neighborhoods that just a year ago were flourishing are today blighted with house after house of "for sale" signs and properties abandoned to foreclosure.

    Read more about it in the LA Times at

    http://www.latimes.com/classified/realesta...realestate-news

    SB

  9. Update from the Times

    Citigroup's renowned credit traders lost $636 million in three months, it emerged today, as the world's largest financial services group revealed the full impact of its suffering at the hands of the credit crunch.

    Charles "Chuck" Prince, the bank's chief executive, said it was a "disappointing quarter, even in the context of the dislocations in the sub-prime mortgage and credit markets".

    In the three months to the end of September, profits dropped 57 per cent to $2.38 billion.

    Mr Prince said a "significant amount" of this was a reult of sliding revenues at the fixed-income business. Revenues at that division plunged 70 per cent to $671 million in this year's third quarter, compared with $2.3 billion last time.

    Citigroup blamed the trading loss on "significant market volatility and disruption of historical pricing relationships". The drying up of market liquidity during the summer meant it was virtually impossible in some cases for traders to mark their positions to market.

    Is this attempt to re-start the market self help or self harm?

    SB

  10. His article is based on nonsense.

    People talk about the housing market as if it were the same as the coffee market, or the sugar market. Good crop = low prices, bad crop = high prices.

    For the nine millionth time ...

    The housing market is driven by demand, not supply.

    Demand is a function of sentiment and affordability.

    Demand for property is infinite - we'd all like a big house, a flat in London and a cottage at the seaside.

    The decision on whether we buy a property - or move up the ladder - is almost totally based on WHETHER WE CAN AFFORD IT.

    I have seen housing markets with ...

    For Sale signs everywhere and prices rising

    For Sale signs everywhere and prices falling

    Very few For Sale signs and prices rising

    Very few For Sale signs and prices falling

    My oberservation of the housing market over the last 35 years is that supply - the number of new homes being built and/or the number of properties on the market at any one point is absolutely NO INDICATOR of price rises or falls.

    Perhaps I should have used [sarcasm on] [/sarcasm off] to avoid all the comments . . . . . of course its not a valid argument!

    Thanks

    SB

  11. We'll it looks like Evans-Pritchard in the Telegraph is thinking the same even if its not today it may be soon

    Simon Derrick, chief currency strategist at the Bank of New York Mellon, says the collapse of the US dollar in the mid-1980s lay behind the ructions that led to Black Monday – modern times' most dramatic one-day crash. The dollar had been sliding relentlessly for two years and was at risk of breaking down in a disorderly rout, much like today.

    "The dollar was under severe pressure in October 1987. Interest rates were on the rise globally, the US trade deficit remained high and energy prices had been increasing on the back of tension in the Gulf," he said. These conditions are more or less in place once again.

    The price of crude oil reached an all-time high of $84 a barrel last week on news of dwindling stockpiles, while US inflation has yet to subside. The producer price index surged in September –now up 4.4pc on last year.

    The dollar has fallen below parity against the Canadian dollar for the first time since 1976. The global dollar index has dropped 9pc over the last year, touching an all-time lows of 77.66.

    See it all at http://www.telegraph.co.uk/money/main.jhtm...C-mostviewedbox

    SB

  12. So it is probable that the market is not only coming off the boil but also is about to feel a nasty chill. It is also quite conceivable that we are embarked on what will turn out to be a substantial, and overdue, correction in property valuations.

    That’s the bad news. The good news is that the extent of the market’s overvaluation can be exaggerated easily, while the danger of a full-scale crash - and the wider consequences, should such a housing bust materialise - is generally blown out of any reasonable proportion by hysterical commentary.

    His argument is based on solid foundations

    Secondly, the systematic shortage of supply of property in Britain, thanks to the planning system, should continue to underpin housing valuations.

    Enjoy the full article at

    http://business.timesonline.co.uk/tol/busi...icle2658408.ece

    SB

  13. Ah - not so sure they are pulling out - looks like they were re-grouping

    However, a Tesco spokeswoman said yesterday that rather than turning its back on the property market, the supermarket was reviewing its options “with a view to launching a new and exciting online estate agency service”. She added: “This would enable us to offer our customers personal advice on the sale of their home.”

    Rest of article at http://business.timesonline.co.uk/tol/busi...icle2658281.ece

    Do you get clubcard points with this?

  14. Citigroup, Bank of America and JPMorgan are on Monday expected to announce plans for a fund to buy mortgage-linked securities in an attempt to allay fears of a downward price-spiral that would hit the balance sheets of big banks.

    A person familiar with the discussions said that US banks collectively were expected to put up credit guarantees worth about $75bn for the fund, named the Single-Master Liquidity Enhancement Conduit. But bankers said the scheme would evolve with the market and may only be as large as demand requires. The SMLEC would be temporary and capped in value, and would not be backed by any state guarantee. A person familiar with the proposals said it was hoped that other banks would join the syndicate.

    http://www.ft.com/cms/s/4550b8c6-7a8d-11dc...com%2Fhome%2Fuk

    You need to subscribe to see the full article

    SB

  15. SOME of the world’s biggest banks are discussing plans to put their weight behind a scheme to back $100 billion in shaky mortgage investments as they try to head off further turmoil in the credit markets.

    The US Treasury and Britain’s Financial Services Authority are both encouraging banks to sign up to the deal.

    Talks were initiated by Robert Steel, the Treasury’s undersecretary for domestic finance. He is a former Goldman Sachs official and adviser to Treasury secretary Henry Paulson, another Goldman alumnus. Both Citigroup and HSBC are believed to have been approached about the proposal. An announcement could come as early as tomorrow.

    Debt experts say that creating a fund would allow structured investment vehicles (SIVs), which own $320 billion of assets, to avoid having to sell their holdings at fire-sale prices and further undermine the credit markets.

    Pushing the deal through may prove difficult as rivals argue they are being asked to potentially bail out Citigroup.

    http://business.timesonline.co.uk/tol/busi...icle2651513.ece

    SB

  16. Behold the wonder of city centre living

    for anyone who hasn't sample the delights of Leeds city living, or even the number of flats for sale, please follow the link, select property type 'Flat' and Leeds Centre and region, 'Leeds Centre'.

    TEIN

    Thanks for that - been keeping an eye on propertysnake but LS1 / LS2 doesn;t seem to be being hit as I'd expected - not sure if propertysnake isn't reflective of the area (its lost most of its feeder sites) or if its not falling as we expect . . . . . only kidding its the feeder sites. Look around the city centre and its new prices all the way.

    Regards

    SB

  17. I work across many verticals mentoring company MDs - I have to say that the outlook varies but reflects what you might expect - discretionary spend is falling pretty sharply (both corporate and individual) - retail is really struggling up here - industrial seems to be OK right now but outlook is less strong - overall I'd say the picture is on the change but yet to tip over - however not sure it will take long.

    Anyone else see the same?

    SB

  18. Yes I remember that, someone called Johnette, quite old, bought £1.3m worth of property and is now bankrupt. Ouch!

    Ah - here is the link

    http://www.yorkshireeveningpost.co.uk/news...sses.3364876.jp

    Losses of millions of pounds in the Leeds buy-to-let market are being investigated by the Serious Fraud Office.

    Today West Yorkshire Police said two men, both from Leeds, had been arrested and bailed yesterday pending further inquiries.

    The investigation of the market in which investors buy up property to rent at a profit, focuses on the roles of property valuers, surveyors and lawyers involved in the deals.

    The YEP has discovered that many investors ended up having properties repossessed because they had been overvalued and investors could not charge enough rent to meet mortgage repayments.

    The investigation is being led by the government Serious Fraud Office, backed by West Yorkshire Police economic crime unit, the successor to the force's fraud squad.

    Enjoy

    SB

  19. McKinsey is one of the highly regarded consulting groups so I'd say their view is worth listening to,

    Ms Farrell, director of McKinsey's economics research arm, said real estate values in developed countries had increased by $30,000bn (£14,679bn) between 2000 and 2005, far outstripping economic growth. This partly reflected property purchases by petrodollar investors but was also a side-effect of lower interest rates caused by investment in government securities – especially in the US – by Middle Eastern and Asian investors.

    "Another concern is that the government connections of Asian central banks and petrodollar sovereign wealth funds may introduce an element of political considerations in their investments," says Ms Farrell.

    The rest is at http://www.telegraph.co.uk/money/main.jhtm.../ccfunds105.xml

    SB

  20. Homeowners worrying about house prices falling here can at least take comfort that they don’t own property in the United States. On the Chicago Mercantile Exchange, traders bet on where house prices are heading in individual American cities. The recent movement in the prices of derivative contracts based on local house price indices tell an astonishingly gloomy story.

    They point to a 28 per cent collapse in house prices in Miami between now and November 2011. They suggest San Francisco prices will plunge by 26 per cent, San Diego by 19 per cent and Las Vegas by 18 per cent. New York prices are heading 12 per cent lower and Los Angeles needs to brace for a 15 per cent fall, the CME prices imply. Even the most resilient of US cities, Chicago, is heading 7 per cent lower.

    Lucky old us then - or is the UK still to catch on? I think many still believe the credit cruch was created and will impact those across the pond - there is an inkling of realisation it might have a knock on effect to us but the fact that we've our own sub-prime isn't yet on the radar . . . . . I say again yet

    http://business.timesonline.co.uk/tol/busi...icle2592129.ece

    Happy Bear day

    SB

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