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Gideon Gono

Interest In Property "up Again" - Bbc

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http://news.bbc.co.uk/1/hi/business/8090028.stm

Rising interest from potential buyers coupled with falling numbers of sellers is stabilising UK house prices, according to surveyors.

New buyer inquiries increased for the seventh month in a row in May - at the fastest rate since 1999, said the Royal Institution of Chartered Surveyors.

But there were fewer sellers, continuing a trend of the last two years, the survey found.

Two other surveys recently reported a rise in house prices in May.

Survey

The Rics survey, which has been running since 1978, takes a snapshot of the degree of confidence in the market from surveyors and estate agents across the UK.

[There are] definite signs of early recovery but we are hoping the usual summer seasonal downturn does not now occur

Ian Shaw, Lincolnshire estate agent

UK house prices 'up 2.6% in May'

They reported that average sales were at their highest level since August last year.

However, at 11.8 properties sold per surveyor in the last three months, this remained 31% down on the same period a year earlier.

The Rics members did again suggest a further increase in potential new buyers window shopping for property, most notably in Scotland, London and the South East of England.

Alongside this, there were fewer people asking agents to sell their homes in May, which was having a logical effect on house prices.

"On the face of it, the housing market does appear to be close to bottoming out with activity picking up in a material way and prices at last stabilising," said Rics spokesman Ian Perry.

"However, it is important to remember that the lack of supply has been as important in underpinning prices as the rise in demand."

'Obstacles'

Some 11% more surveyors were now expecting property prices to fall rather than rise, the survey found. In addition, 40% more were predicting sales to increase than fall.

Yet, Mr Perry stressed that the troubled state of the economy could still constrain any housing market recovery.

"With the economic backdrop still quite uncertain, unemployment is set to continue increasing sharply and finance for first time buyers is still in short supply, there are a number of significant obstacles for the market to overcome over the coming months," he said.

Some surveyors pointed to the seasonal nature of property sales.

"[There are] definite signs of early recovery but we are hoping the usual summer seasonal downturn does not now occur," said Ian Shaw, who operates in Lincolnshire.

On 4 June, a survey by the Halifax said that UK house prices rose by 2.6% in May compared with April but activity remained low in the market.

This came shortly after the Nationwide building society reported a 1.2% rise in prices in May compared with April - the second rise in three months.

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http://news.bbc.co.uk/1/hi/business/8090028.stm

Rising interest from potential buyers coupled with falling numbers of sellers is stabilising UK house prices, according to surveyors.

New buyer inquiries increased for the seventh month in a row in May - at the fastest rate since 1999, said the Royal Institution of Chartered Surveyors.

But there were fewer sellers, continuing a trend of the last two years, the survey found.

Two other surveys recently reported a rise in house prices in May.

Survey

The Rics survey, which has been running since 1978, takes a snapshot of the degree of confidence in the market from surveyors and estate agents across the UK.

They reported that average sales were at their highest level since August last year.

However, at 11.8 properties sold per surveyor in the last three months, this remained 31% down on the same period a year earlier.

The Rics members did again suggest a further increase in potential new buyers window shopping for property, most notably in Scotland, London and the South East of England.

Alongside this, there were fewer people asking agents to sell their homes in May, which was having a logical effect on house prices.

"On the face of it, the housing market does appear to be close to bottoming out with activity picking up in a material way and prices at last stabilising," said Rics spokesman Ian Perry.

"However, it is important to remember that the lack of supply has been as important in underpinning prices as the rise in demand."

'Obstacles'

Some 11% more surveyors were now expecting property prices to fall rather than rise, the survey found. In addition, 40% more were predicting sales to increase than fall.

Yet, Mr Perry stressed that the troubled state of the economy could still constrain any housing market recovery.

"With the economic backdrop still quite uncertain, unemployment is set to continue increasing sharply and finance for first time buyers is still in short supply, there are a number of significant obstacles for the market to overcome over the coming months," he said.

Some surveyors pointed to the seasonal nature of property sales.

"[There are] definite signs of early recovery but we are hoping the usual summer seasonal downturn does not now occur," said Ian Shaw, who operates in Lincolnshire.

It's a housing led recovery, all is saved.

Trouble is what will happen if there is an increase supply of property? Will prices go up or down.

An over supply of a good has what effect on price?

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http://news.bbc.co.uk/1/hi/business/8090028.stm

It's a housing led recovery, all is saved.

Trouble is what will happen if there is an increase supply of property? Will prices go up or down.

An over supply of a good has what effect on price?

In the mid Devon area where I've been watching property sales closely I have been amazed by the recent activity in the market, properties on the market for the last year all selling in the last month or two. It is an astounding turn around. Question is just how long this upturn will last as there is no supportive FTB floor under this upturn.

Edited by munimula

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In the mid Devon area where I've been watching property sales closely I have been amazed by the recent activity in the market, properties on the market for the last year all selling in the last month or two. It is an astounding turn around. Question is just how long this upturn will last as there is no supportive FTB floor under this upturn.

More important than that how long will the banks money lending capacity last.

Once they run out of lending capacity any housing recovery will stall.

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http://news.bbc.co.uk/1/hi/business/8090028.stm

It's a housing led recovery, all is saved.

Trouble is what will happen if there is an increase supply of property? Will prices go up or down.

An over supply of a good has what effect on price?

Nationwide:

“If the supply of homes onto the market does increase, the recent moderation in the pace of house

price falls may not be sustained

Hometrack last week:

Richard Donnell, director of research for Hometrack, said: “Overall levels of market activity are well down on what would constitute normal market conditions. The willing purchasers that are returning are largely confined to the more wealthy areas of the country and limited to those buying with cash or who require low loan-to-value mortgages.â€

Article Last Week:

But don’t let the ‘green shoots’ brigade confuse you. Agents are still selling less than one home per week and the vast majority - some 60% - say prices are falling. Forecasts from RICs agents are getting better but 43% still expect prices to fall.

Article in Relation to Land Reg figures last week:

The mainstream media will generate plenty of opinion today suggesting a 'bottom' of sorts has been reached by the housing market. With transaction numbers at lows not seen since the seventies and mortgage lending 60% down year on year this would be a premature assumption when mortgage lending and sales transactions suggest an undeniable fact; the housing market is in fact dead...

RICS today:

Increased buyer interest and lower new instructions provide support for house prices.....

The May survey provides more evidence that activity in the housing market is continuing to pick up, albeit from historic lows. .......................

........As a result, the average number of unsold properties on surveyors’ books continues to decline; the latest reading of 58.4 is the lowest since May 2004 and represents a 35% reduction compared with a year ago.

The combination of higher sales and lower inventories has pushed the sales to stock ratio firmer for the fifth consecutive month.

There does seem to be some consensus amongst EA's that sales are being achieved at 25 - 30% off peak, which is what RICS said in March:

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors

Most of the house price indices suggest prices have fallen by up to 20pc from the peak. However, many of our members [surveyors and estate agents] cast doubt on this and calculate independently that the scale of price falls has been even greater − 30pc or more already. They suspect the Nationwide and Halifax figures are underestimating scale of the peak-to-trough fall to date.

Looking at the surveys you have to come to the conclusion that we aren't at the bottom by any stretch yet. Our members are still expecting further falls in prices, according to our survey, and if there's anyone you might expect to be talking up the market it is them

So even if we are speaking of property prices stabilising, which I very very much doubt we are still talking a £300000 property at £210000.

That is Mc Tavish's equity reduced from £400000 to £280000, how will he be able to hold his head up!

Edited by Sybil13

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More important than that how long will the banks money lending capacity last.

Once they run out of lending capacity any housing recovery will stall.

Made this point yesterday here :

HPC Link

And asked where the money was going to come from?

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Across the news outlets this morning they are running 2 storys back to back (independently, but the connection is glaringly obvious to any HPC'er).

First is the "good" news about the housing market picking up again, the second is how 25% of the country have cancelled their home insurance as they can't afford it anymore...

Need a wall to bang my head against.

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Elsewhere in the news....1500 jobs going at C&G....800 at LDV.....(with how many associated indirect job losses?)

I am 'retraining' on an 'IT' course at the moment.

Every morning I walk to the Learning Centre in the middle of town and I pass 6 boarded up shops.

This includes the old Woolworths, a prime high street shopping site still empty 6 months after Woolies collapse.

Every day people are coming into the Centre with the same story...." I was working in a Factory/warehouse/shop and I've been made redundant.. there aren't any similar jobs available...I want to retrain in IT".

I believe this housing 'recovery' won't last very long.

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That is Mc Tavish's equity reduced from �400000 to �280000, how will he be able to hold his head up!

He won't, he'll be playing out my sig ;)

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What gets me is that, along with the headline, 'Interest in property up again', you also have the topics, 'Lloyds closing all C&G branches' and 'Setanta is on brink of Collapse', all on the same page.

How can people honestly believe that the housing market is 'recovering' when so many companies in the financial sector are having big problems.

Munchie

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the second is how 25% of the country have cancelled their home insurance as they can't afford it anymore...

any chance of a link for this

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Across the news outlets this morning they are running 2 storys back to back (independently, but the connection is glaringly obvious to any HPC'er).

First is the "good" news about the housing market picking up again, the second is how 25% of the country have cancelled their home insurance as they can't afford it anymore...

Need a wall to bang my head against.

I wonder how many of those that cancelled are already in arrears or close to being in arrears?

Isn't it a part of the mortgage contract that you have home insurance?

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That is Mc Tavish's equity reduced from �400000 to �280000, how will he be able to hold his head up!

Yes, you keep saying that, but as usual with your statements, a closer look at the facts will prove it to be completely false.

My present house was purchased in Jan 2007. Prices in Aberdeen have not yet reverted to January 2007 levels, according to the Register of Scotland. In fact, that same data actually showed a rise in price of 0.9% in the last year for my most recent house type and location.

The statement about equity, was based on prices shortly before I bought the second house. Prices obviously rose since then until peak, and have now fallen since peak. But as prices have not yet reverted to the level of Dec 06 or Jan 07 either in Aberdeen or the Shire, it is clear your statement is incorrect.

I cannot deny that both my properties are worth less today than they were at peak. But both are worth more than they were in Jan 07..... ;)

The data is freely available. Check for yourself.

Edited by HAMISH_MCTAVISH

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What gets me is that, along with the headline, 'Interest in property up again', you also have the topics, 'Lloyds closing all C&G branches' and 'Setanta is on brink of Collapse', all on the same page.

How can people honestly believe that the housing market is 'recovering' when so many companies in the financial sector are having big problems.

Munchie

This might sound like nitpicking, but Setanta is a TV broadcaster, nothing to do with the financial sector... ;)

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Even Radio 1 are repeating this story about "interest in property is up again", on their short news bulletins...

and the Bloomberg tv ticker is going with the old "supply" story. It's ticker currently reads "House prices show signs of stabilizing as supply drops, demand mounts."

I guess the media need to keep the current house price ramping news coming out now ,as already said, any dead cat bounce has to finish soon, with the economical news getting worse by the day.

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Yes, you keep saying that, but as usual with your statements, a closer look at the facts will prove it to be completely false.

My present house was purchased in Jan 2007. Prices in Aberdeen have not yet reverted to January 2007 levels, according to the Register of Scotland. In fact, that same data actually showed a rise in price of 0.9% in the last year for my most recent house type and location.

The statement about equity, was based on prices shortly before I bought the second house. Prices obviously rose since then until peak, and have now fallen since peak. But as prices have not yet reverted to the level of Dec 06 or Jan 07 either in Aberdeen or the Shire, it is clear your statement is incorrect.

I cannot deny that both my properties are worth less today than they were at peak. But both are worth more than they were in Jan 07..... ;)

The data is freely available. Check for yourself.

You only find out what it's worth when you put it on the market.

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"I wonder how many of those that cancelled are already in arrears or close to being in arrears?

Isn't it a part of the mortgage contract that you have home insurance? "

You cant really go into arearrs as such with Home insurance as its not credit. After a month or 2 of missed premiums the lender will usually terminate the policy.

Buildings insurance is compulsory when the house is mortgaged. If you own outright then its up to you if you want to risk not having it.

I reckon (and i didnt look at the links) this is more likely to refer to contents insurance.

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RICS Report

RICS big chief Simon Rubinsohn now looks ridiculous, after what he said a few weeks back.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors

Most of the house price indices suggest prices have fallen by up to 20pc from the peak. However, many of our members [surveyors and estate agents] cast doubt on this and calculate independently that the scale of price falls has been even greater − 30pc or more already. They suspect the Nationwide and Halifax figures are underestimating scale of the peak-to-trough fall to date.

Looking at the surveys you have to come to the conclusion that we aren't at the bottom by any stretch yet. Our members are still expecting further falls in prices, according to our survey, and if there's anyone you might expect to be talking up the market it is them.

So what are you saying Fantasy Queen ? That SR was lying when he said that property had already fallen 30%?

The report you provided the link for says:

Increased buyer interest and lower new instructions provide support for house prices

Or in other words repeating what Nationwide and others said last week:

If the supply of homes onto the market does increase, the recent moderation in the pace of house

price falls may not be sustained.

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It sounds counter intuitive but the more enquiries the better. Its more upward pressure on sellers and estate agents to accept the reality that house prices need to reduce. For all the increase in interest transactions levels are low.

Me and the missus have seen a dozen houses over the last 2 weeks but we have not put in any offers. Our interest is enormous but we're in no rush. Even the estate agents on a couple of properties have said "you could put a cheeky offer in on this one". I was a bit surprised - arn't they duty bound to get the maximum price?.

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So what are you saying Fantasy Queen ? That SR was lying when he said that property had already fallen 30%?

The report you provided the link for says:

Increased buyer interest and lower new instructions provide support for house prices

Or in other words repeating what Nationwide and others said last week:

So Sybil,

How do you dispute the land registry stats, which show 17% off peak.

These are actual sold prices. There is no getting around them. You cannot quote the opinion of one man, who was quoting the opinion of some surveyors many months ago, and state that is more accurate than a record of actual sales prices.

The most recent RICS survey shows a clear uptrend. How do you account for that. Was RICS being honest then and lying now? IS it all a big conspiracy?

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