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Rics: House Prices 'close To Stabilising'

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Guardian

House prices 'close to stabilising'

Rics chief says house prices will soon stabilise, but lending will continue to elude first-time buyers

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* Lisa Bachelor

* guardian.co.uk, Wednesday 20 May 2009 16.41 BST

* Article history

House prices will stop falling before the end of the year, but mortgages will remain out of reach of many first-time buyers, a leading economist said today.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said he expected house prices to stabilise from the middle of this year and that reports of an overall 45% decline in prices were overly-pessimistic. "I think the overall decline will be more like 25%-30%," he said.

However, he added that lenders were unlikely to start offering high loan-to-value (LTV) mortgages this year, despite the news today that Lloyds TSB has launched a 95% LTV loan.

"I think we will see lenders coming out with more interesting packages, but these will entail being tied into another product," he said. "I don't see a big return to 90%-95% lending."

He added that buyer enquiries had risen over the past six months, but there had been a corresponding decrease in the amount of property on offer.

"This is partly because there are fewer distressed sales [people being forced to sell] – partly because home information packs may have put off speculative sellers and partly because people are still reluctant to sell at a price below what they think their property is worth," he said.

Contrary to expectation when the credit crunch began, the London property market had been the most, not the least, buoyant in England and Wales, Rubinsohn said. "Buyer enquiries have risen particularly in London. Our members are picking up on a lot of potential interest from overseas buyers."

He added that it would be a "reasonable guess" to expect interest rates to rise to 5% over the next three years.

Positive news everywhere you look :)

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House prices will stop falling before the end of the year, but mortgages will remain out of reach of many first-time buyers, a leading economist said today.

That makes me laugh so much. "House prices will stabilise but er no-one will actually be able to sell them, erm duh yeah".

Cloud cuckoo land.

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That makes me laugh so much. "House prices will stabilise but er no-one will actually be able to sell them, erm duh yeah".

Cloud cuckoo land.

Troll land.

BACK UNDER YOUR BRIDGE RINOA!

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Rics chief says house prices will soon stabilise, but lending will continue to elude first-time buyers

Is it possible for there to be a housing market without first time buyers?

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and without BTL

Even worse the article gives a good reason as to why BTL is a no go. 5% interest rates or some dodgy low yielding property. Quite an easy call :D

He added that it would be a "reasonable guess" to expect interest rates to rise to 5% over the next three years.

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Guest AuntJess
Is it possible for there to be a housing market without first time buyers?

Nope. but I've known quite a few people who think that if they say a thing often enough, it makes it true, irrespective of what the actual facts are. :rolleyes:

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To be fair I do see a stabilisation in the falls, hpc stage 1 over = 20%.

BUT............now see hpc2 being readied for action. Namely the FSA bringing out rules on mortgaing lending.

Nothing is going to stop the bubble deflating all we are seeing is attempts to deflate it as slowly as possible.

It's 40-50% whatever..........

hpc 3 will be when interest rates begin to rise, coinciding with the reality of being a landlord for all the 'we will sit it out' brigade.

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Guardian

Positive news everywhere you look :)

I have looked and yes there is loads of positive news

in 2007:

Simon Rubinsohn, chief economist at the Royal Institute of Chartered Surveyors, which publishes major data on the British housing market, warned that there was just a 1 in 10 chance of a significant drop in house prices and that prices were likely to remain flat until next year.

in 2008:

The RICS's chief economist, Simon Rubinsohn, said: "2008 will prove a difficult year for the housing market, but with falls likely in the base rate, the housing market should be provided with a stable platform.

:lol::lol:

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Is it possible for there to be a housing market without first time buyers?

According to this from today's Telegraph FTB's are making a comeback.

Maybe it's better than the big chief at RICs even realised. :o

Edited by Rinoa

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To be fair I do see a stabilisation in the falls, hpc stage 1 over = 20%.

BUT............now see hpc2 being readied for action. Namely the FSA bringing out rules on mortgaing lending.

Nothing is going to stop the bubble deflating all we are seeing is attempts to deflate it as slowly as possible.

It's 40-50% whatever..........

hpc 3 will be when interest rates begin to rise, coinciding with the reality of being a landlord for all the 'we will sit it out' brigade.

I mentioned in a thread a while back (backed up with a graph) that in London, in the 89 crash, the 20% drop which took a bit longer to arrive, heralded the bull trap.

There was a small rise but then prices fell away again, with the final resting place being around 32% off peak in nominal terms.

Maybe 20% is a psychological figure...

Or maybe it is just coincidence because these 2 crashes are somewhat different

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Is it possible for there to be a housing market without first time buyers?

The RICS statement is a bit contradictory, but I suppose prices can stabilise as most people dont need to move and we will see worldwide government determination to maintain inflation come what may. Those with housing debt will be rewarded in this scenario sooner or later.

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Is it possible for there to be a housing market without first time buyers?

LOL! It is daft isn't it. I'm suprised Rinoa posted this article, as quite clearly it makes no sense in that little sentence.

Rinoa - a little lesson - the housing market relies on a great number of FTBs entering the market every year. Without this it collapses. How can anyone move up the ladder if they can't sell their first property to a FTB. All we will have is chains going nowhere. If FTBs can't get a mortgage now what will happen is house prices continue to fall until they can. Simples.

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House prices stop falling because the idiot EAs say that buyers are there waiting to grab a bargain, so the sellers either stop dropping prices or increase them.

In the meantime buyers dont have the deposit, and are unable to get finance.

New sellers stay away from the market thinking that one day houses will return to 07 prices, and we know this cannot happen as there isnt a mechanism for selling on mortages as during the boom time.

http://www.channel4.com/4homes/property-mo...#33;8888!-1 :

So, the reason we are being told that there are ‘green shoots’ at the moment in the housing market is that:

* Agents are reporting a rise in the number of buyers registering, up from 240 per agent in February 2009 to 268 in March 2009.

* The percentage of sold boards versus for sale signs is on the increase at 23.7% up from 21.1% in March 2009.

* Offers versus asking prices are increasing, up in March 2009 to 88.8 from 88.3 in February 2009.

* The number of mortgages has increased by 16% in March 2009 versus February 2009, however this is still less than half the amount lent in the same month last year.

However, all these statistics are measuring is that we are selling a few more properties than we did last year. This doesn’t mean there is a ‘recovery’ yet as prices are still low versus last year, the most accurate price data (which is from the Land Registry) is still recording falls, but more importantly, the number of people buying and selling is less than half than it was last year.

So the VIs keep on trying to grow those green shoots.

Edited by Yorkshire Lad

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According to this from today's Telegraph FTB's are making a comeback.

Maybe it's better than the big chief at RICs even realised. :o

Return of the lamb to the slaughter you mean, a few younguns about to destroy mummy and daddies money. :lol:

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Is it possible for there to be a housing market without first time buyers?

Well, I suppose people can agree to swap houses with each other for more money....

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but I suppose prices can stabilise as most people dont need to move and we will see worldwide government determination to maintain inflation come what may. Those with housing debt will be rewarded in this scenario sooner or later.

The market is never that static. You have the three D's – "Death, Divorce or Debt" (a lot of debt with unemployment and record personal debt this time around) and obviously things like a young couple in a flat who have just had a kid.

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LOL! It is daft isn't it. I'm suprised Rinoa posted this article, as quite clearly it makes no sense in that little sentence.

Rinoa - a little lesson - the housing market relies on a great number of FTBs entering the market every year. Without this it collapses. How can anyone move up the ladder if they can't sell their first property to a FTB. All we will have is chains going nowhere. If FTBs can't get a mortgage now what will happen is house prices continue to fall until they can. Simples.

Rinoa posting something ridiculous....why the surprise?

My only surprise is they (sibley, rinoa and co) don't ever seem to get bored of it!

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Rinoa - a little lesson - the housing market relies on a great number of FTBs entering the market every year. Without this it collapses.

And here they are.

:D

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The new mortgage, called Lend a Hand, from LLoyds.

I lent a hand to my Daughter in 2007 with £20.000 for a deposit

thats gone out the window with the house worth less NO THANKS

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