Nationwide March House Prices 2nd April 2009

[Guest absolutezero]

HPC over.

Sibley et al are obviously right...

[talksalot81]

I would be more concerned if we didnt see anything like this - with everything that has been done in the UK there should be a short term response to it. But I see it as nothing more than a strong sign of a bull trap since there is little to support a sustained change in the market.

[Leonard Hatred]

I can imagine thousands of sheeple flocking to their local building society on this news, only to be kicked out of the mortgage advisor's office once again.

[Mikhail Liebenstein]

I would be more concerned if we didnt see anything like this - with everything that has been done in the UK there should be a short term response to it. But I see it as nothing more than a strong sign of a bull trap since there is little to support a sustained change in the market.

I don't think this is particularly suprising as in the last crash there were momentary upticks before the downward cycle resumed.

I don't want this to sound like I am criticising Nationwide (or indeed Halifax) when the data doesn't go in the HPC direction. But as some have pointed out these indexes are currently understating the true extent of declines due to them missing out a lot of aggressive cash purchases, especially at auction.

That said this effect probably works the other way later on, as once some of those repos etc get sold on a second time, they may be at a relatively lower price to the rest of the market which may then hold the Nationwide / Halifax indexes artificially down.

So what really matters is the long term trend.

Edited April 2, 2009 by mikelivingstone

[ccc]

so many words, so many possible conclusions.

All I know is that the builders are pushing the homebuy scheme for all its worth, lenders still have tight criteria and the Nationwide has no info on volumes....least of all...COMPLETIONS.

My own area is falling fast...east Anglia...we had apparently done well earlier, but its catching up now.

still over a million properties on rightmove.

and the trand graph shows we have reached normality.....course the trend reflects serious HPI and lending boom.

Ditto for Scotland, and Edinburgh. Oh and Aberdeen.

The consumer survey for Scotland is interesting though. According to this only 33% of Scots questioned thought prices would fall in Scotland in the next 6 months !!!

Honestly we must be a nation of Hamish's. Just going to drag it out longer. I can wait.

[Limpet]

C`mon Sibley give us a song

Give us a song

Give us a song.....etc

[bear_or_bull]

This is the beginning of the end, or the end of the beginning, or the bottom, or a hiccup.

Longer term though it will lead to either:

#1

- more nominal house price falls & total deflationary apocolypse.... (touch wood) unlikely...

#2

- more nominal house falls & less debt, but the economy turns around slowly... a (painful) move to a more sustainable economy

#3

- some people getting into housing again, a reduction/stabilisation in nominal price falls or simple nominal stasis. Debt is then eroded by inflation. i.e. real house price falls....

#4

- more people getting into housing and prices magically following the inflation rate. Real price stasis...

#4

- people shouting FILL YOUR BOOTS, leaving their street clothes at the G20 riots, and piling into mortgages. Property only ever goes up right? We were only pretending to be bears... Unemployment is fixed. Factories start producing. People MEW to consume. Commodity prices shoot up. Oooh. Inflation, or raise interest rates and be back where we started but with all the big guns empty.

The first option is the EOTWAWKI. Your strategy should be preservable staples and shotguns. Plus maybe trinkets, candles, and a salt farm.

The second option is the only one in which the problem ends quickly. Your strategy should be cash, shifting gradually into shares + investables. Eventual home purchase in a few years, if that's your aim.

In the third option the problem is eroded gradually (& inflation will have to kick off for it to do so at a reasonable pace). Your strategy is tricky, and could involve high risk property investment or inflation linked bonds...

The fourth option is extremely unlikely. You'd need inflation linked assets.

The fifth option is actually a possibility I believe, but only compounds the existing debt problem. It will be end of chapter one, not the end of the story. Good strategy might be to pile up in gold when it drops (massively) as it surely leads back to #1....

The most probable for me is still #2, #5 is 2nd (would you believe), #3 3rd, #1 forth, and #4 practically impossible...

[Drunken Tiger]

We knew the dead cat bounce was coming, and I wouldn't be surprised if it goes on for a few months. A number of STRs who think they "got lucky", will now be panicked back into the market (especially families). They are frightened to lose all their gains at the casino. The other type is those young FTBs (like the ones you always see in the pic below BBC website HPI articles, with the woman always pointing at an EA window, puke!) with a bit of Granny's inheritance, straining at the leash to get on the "ladder" (thinking it's Jacob's Ladder when really it's a Stairway to Hell).

I have some sympathy with families, desperate for a roof over their heads in this land of spivs and vultures that we call "Great" Britain. But as an STR (2005) I'm going to see this through right to the bitter end. Sure, it'd be nice to do a good deal one day. But really on any rational measure UK prices are still way too high. And it's not just about us, it's about the future of the country - do we continue being a nation of small-minded property-obesessives, shoppers, celebrity nutters, or could we build something new? Will normal service be resumed just as soon as the crash is over? Or can we stand up to them? Renting is, after all, very liberating, and if it's good enough for the Germans, and the Swiss, why not us?

I've made my choice. There is no going back...

[Confounded]

I expect to see a lot of posters saying that this rise doesn't matter, etc..... Well, it does matter a little, and until next month it probably matters a lot in terms of sentiment.

Agreed, it does matter and very lucky for GB it came when the whole World is pulling together to fix this problem, and in time for spring.

The numbers aren't controlled by some great conspiracy of shadow forces.

Does this correspond with the small bounce they saw 2 months ago, or is it the start of a new spring bounce?

The small bounce we saw 2 months ago was in the Halifax data at the time they were taken over by the Government. This was used to sow the seeds of a false bottom. Nationwide were given the gift of Dumferline Building Society last week with a several £billion cash injection to bail them out via the back door. The gift back to the Government is this and will help further with the work done at Halifax. It may be just another coincident but when you run a sentiment based economy largely around the values of peoples home these figures are the most important data of all. You could tell the population that 3M people are unemployed the country is bankrupt and so long as you told them their houses were up 1% and were going to continue to rise they would on balance be ecstatic.

[crown]

It should be remembered that You need a 15% deposit for a Nationwide mortgage, but a 10% deposit will get you a Halifax mortgage.

Both these lenders are also slightly off the competitive edge at the moment.

I wonder if this will make a difference to the data?

[A Fool & His Borrowed Money]

Dead Cat Bounce, & a fake one at that, given the "Seasonal Adjustment"

[Yorkshire Lad]

http://www.bloomberg.com/apps/news?pid=206...&refer=home

April 2 (Bloomberg) -- U.K. house prices unexpectedly rose for the first time since October 2007 after the Bank of England’s interest-rate cuts attracted buyers to the property market, Nationwide Building Society said.

The average cost of a home jumped 0.9 percent in March from the previous month to 150,946 pounds ($218,000), the mortgage lender said in a statement today. All 13 economists in a Bloomberg News survey predicted a drop.

[SarahBell]

In a way it'll speed up things.

People who might have been about to lower their price will remain stubborn and refuse vaguely sensible offers. Less will sell apart from the 4 Ds which will mean the prices drop much lower next time.

It can only be normal people selling and not the massive price drops we've seen on repos etc that has changed this.

[HPCbeliever]

Still it is depressing as it gives hope to the bulls. I think i will be depressed all day.

However with CPI at 3.2% and now HPI again - shouldn't MPC raise interest rates?

[Conquistador]

Probably snuffed out by another fall on the Halifax to be announced in a few days.

Annoyingly, reporter on Radio 4 news finished his report on the Nationwide figures by saying there was a long way to go. I thought he was going to say downwards. But he then said upwards - to the last peak! No mention of noisy data or long-term trend. Tch.

[Valerius]

Why can not you accept prices won't go down to the floor as many of you are hoping?

Always the same comments, blip, dead cat bounce, it does not matter, this is irrelevant.

Well it does matter. I have often said spring bounce would be coming, and here it is.

I am sure this set of data will be dismissed as per before, but anyway, reality is that sellers have already taken notice of the mortgage approvals going up, and certainly won't sell on the cheap for the foreseable future.

You can forget getting a house for half price.

Oh happy days

[tegan]

The government have pumped hundreds of billions of taxpayers money into the system and all it's caused is a small blip. Unless there's biillions more of taxpayers money then it's just that, a blip.

[stuckmojo]

Agreed, it does matter and very lucky for GB it came when the whole World is pulling together to fix this problem, and in time for spring.

The small bounce we saw 2 months ago was in the Halifax data at the time they were taken over by the Government. This was used to sow the seeds of a false bottom. Nationwide were given the gift of Dumferline Building Society last week with a several £billion cash injection to bail them out via the back door. The gift back to the Government is this and will help further with the work done at Halifax. It may be just another coincident but when you run a sentiment based economy largely around the values of peoples home these figures are the most important data of all. You could tell the population that 3M people are unemployed the country is bankrupt and so long as you told them their houses were up 1% and were going to continue to rise they would on balance be ecstatic.

Spot on. "****** everyone else. I'm making a lot of money on me nest egg." God I hate this petty mentality.

[Bloo Loo]

Why can not you accept prices won't go down to the floor as many of you are hoping?

Always the same comments, blip, dead cat bounce, it does not matter, this is irrelevant.

Well it does matter. I have often said spring bounce would be coming, and here it is.

I am sure this set of data will be dismissed as per before, but anyway, reality is that sellers have already taken notice of the mortgage approvals going up, and certainly won't sell on the cheap for the foreseable future.

You can forget getting a house for half price.

Oh happy days

a bounce has an up and a down...glad you can see it too.

[Caveat Mortgagor]

Shock!!!!! The line on the graph doesnt go straight down!!!!!!

The only concern this news causes me is that it delays the inevitable. I got the feeling that sellers near me were on the brink of caving in - a small number have. But a few more months of bad news would have made it more widespread.

This will slow things down a little - that is all.

Shameless reporting by the BBC though.

Bill Turnbull managed to expose a VI this morning. Man from AA complaining about fuel duty rises. Bill said "you would say that wouldn't you - you work for a motoring organisation".

This is the same bloke who introduces mortgage peddlers and estate agents to be described as property experts without unmasking a vested interest.

To add to my annoyance he announced the Nationwide figures by clapping his hands, smiling and saying "Now........ for some good news for the property market over to........."

F@ck off Bill. Report the news, do not tell me how to feel about it!

[Joey Buttafueco Jr]

NSA is +2.2% MOM

[grumpy-old-man-returns]

Why can not you accept prices won't go down to the floor as many of you are hoping?

Always the same comments, blip, dead cat bounce, it does not matter, this is irrelevant.

Well it does matter. I have often said spring bounce would be coming, and here it is.

I am sure this set of data will be dismissed as per before, but anyway, reality is that sellers have already taken notice of the mortgage approvals going up, and certainly won't sell on the cheap for the foreseable future.

You can forget getting a house for half price.

Oh happy days

for those that remember:

'anomalies in the stats'

iirc, didn't the nationwide have a 1% increase in Jan when all other indices said falls.

slooooooooooooooooooooow motion.

[thecrashingisles]

iirc, didn't the nationwide have a 1% increase in Jan when all other indices said falls.

slooooooooooooooooooooow motion.

No it was Halifax who reported a 2% rise.

I'm surprised you don't see this as the start of hyperinflation... Average house price £1m by Christmas?

[grumpy-old-man-returns]

No it was Halifax who reported a 2% rise.

I'm surprised you don't see this as the start of hyperinflation... Average house price £1m by Christmas?

ah ok.

we need to see a 2012ish bottom in housing first.....then 10 years of stagnation in inflation adjusted property prices.

50% falls from here to come yet.

[tegan]

House prices 150k and rising, mortgage approvals up 19%...so the question is, where are these people getting 6x average salary from?