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VeryMeanReversion

Standard & Poor Repossession Forecast

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11476.jpg

This is the repossession rate forecast from S&P for the U, nicked from http://ftalphaville.ft.com/blog/

They seem to think its going to be twice as bad (good!) as the last crash with downside up to 3x/4x worse.

Annoyingly for us, it may mean that the earliest, sensible time to buy a house will be 2011, equivalent to around 1996.

The current problem for HPC'rs is lack of supply. I think this graph shows the the solution and it will overwhelm any residual demand that is currently supporting prices.

VMR.

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Annoyingly for us, it may mean that the earliest, sensible time to buy a house will be 2011, equivalent to around 1996.

VMR.

Thanks VMR that's fascinating.

Really does seem to me as though Brown and the banks and building socs have tried to prop up the crashing market by delaying the repos hitting the market. Upside is this can't last forever as the graph suggests; downside is we'll have to be patient. I renegotiated my rental contract with a 10% discount so I'm happy to wait until the start of 2010 now.

The thought of waiting till 2011, though, brings me out in a sweat - a combination of impatience, fear over holding a 95% cash STR fund and concern that every VI out there is ready to sell those like us down the river in order to prevent HPC.

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11476.jpg

This is the repossession rate forecast from S&P for the U, nicked from http://ftalphaville.ft.com/blog/

They seem to think its going to be twice as bad (good!) as the last crash with downside up to 3x/4x worse.

Annoyingly for us, it may mean that the earliest, sensible time to buy a house will be 2011, equivalent to around 1996.

The current problem for HPC'rs is lack of supply. I think this graph shows the the solution and it will overwhelm any residual demand that is currently supporting prices.

VMR.

I assume this is for the US?

The supply issue is different in the UK (although not as different as some would have you believe).

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I've said it before and will say it again: Gordon's hope that inflation regains a foothold in the property market is based on continuing high employment and the absense of stress (reposessions) in the market place.

People cannot afford to buy at current prices. They need to drop another 30-40%. Job numbers will ensure that they do. You cannot beat the market and when you try to do so the banks supporting it will go bust. The HPC is on track.

Edited by Realistbear

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Really does seem to me as though Brown and the banks and building socs have tried to prop up the crashing market by delaying the repos hitting the market. Upside is this can't last forever as the graph suggests; downside is we'll have to be patient. I renegotiated my rental contract with a 10% discount so I'm happy to wait until the start of 2010 now.

As far as The Cretin Brown is concerned as long as he can prop it up until May next year that's a 100% success; if it all implodes in July 2010 then he can lay all the blame on the Conservative party.

The bankers seem happy enough to play along for now; the only flaw in the plan is that as the election draws nearer they will want to please their new masters rather than the outgoing ones - perhaps we'lll see an aweful lot of "bad" news during the campaign.

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Is this for the UK? I couldn't find it using the link.

Links says "The below chart is the rating agency’s repossession rate forecasts for the UK, published on Monday."

It looks like our 89-95 crash.

VMR.

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They need to drop another 30-40%. Job numbers will ensure that they do.

Demographics says the number of peak earners (40-45yr olds) peaked in 2006 and goes into terminal decline after that.

However, their number is still way above the long term average and this will limit falls in this cycle. It wil be a long term drag for decades. Millions lose their jobs but many are left with good earnings.

So I only expect another 20-25% for this bust.

VMR.

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I've said it before and will say it again: Gordon's hope that inflation regains a foothold in the property market is based on continuing high employment and the absense of stress (reposessions) in the market place.

People cannot afford to buy at current prices. They need to drop another 30-40%. Job numbers will ensure that they do. You cannot beat the market and when you try to do so the banks supporting it will go bust. The HPC is on track.

We'll when your delusional this clearly will happen.

The man lives in a different reality to the rest of us.

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Have you got the link to the blog article please?

It was on the main FT blog at the time I posted seems to have been pulled from the FT site. I used "properties" to find out where they got the graph from and posted that. I didnt keep a copy of the article.

VMR.

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As far as The Cretin Brown is concerned as long as he can prop it up until May next year that's a 100% success; if it all implodes in July 2010 then he can lay all the blame on the Conservative party.

A few months ago I would have agreed with you that a May 2010 election was best for the one-eyed idiot. Now I reckon he's wishing it was pencilled in for September this year. The green shoots/bounce won't last forever... May 2010 seems a long, long way off from here.

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It was on the main FT blog at the time I posted seems to have been pulled from the FT site. I used "properties" to find out where they got the graph from and posted that. I didnt keep a copy of the article.

VMR.

Thanks - I recall reading the same article last week but couldn't find it by searching just now.

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Wasn't there a thread on here a few weeks back, showing that the banks were holding off repossessing... essentially becoming the landlords for properties?

They can't do that forever, and I'd expect to see a huge flush of properties when the banks release them.

edit: Oh, if you see a graph with low estimate and high estimate, you can guarantee that it will be at, or above, the higher (worse) estimate. 3-5% repossession rates, anyone...?

Edited by Lepista

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Curious they pulled that entry.

tinfoilhat.gif

Special instructions from the JoeSchmo NuLabour Instant Rebuttal Unit?

ED: Previous post began with 'Interesting'. Bah!

Edited by yellerkat

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