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Sonic the Hedge Fund

Haliwide Points Up; Rightmove Points Down

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No one seems to take much notice of the Rightmove index these days. Even the media seem to have lost interest

There has been a lot of discussion on here about the validity of RM; IMO the bottom line is that it's a yardstick of seller's expectations, and nothing more.

So I was curious to see the index for Aug 09 is DOWN by -2.2%, following an uptick over the four months Feb-May correlating closely with the recent Haliwide figures, but with a 2 month delay

What does this mean?

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Edited by Sonic the Hedge Fund

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I guess that more houses are being marketed, and people are asking for a bit less than the ones already sat there not selling.

Which going forward points to lower sale prices and the end of the dead cat bounce?

RM has historically been a very bullish indicator; so IMO a -2.8% swing in RM is very bearish indeed.

hpi-monthly-change.png

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nah, RM is just worthless, i think.

initial asking prices being down is significant in a sense but you have to consider that initial asking prices have been insanely high, barely down at all from peak, we've had very few sales and huge discounts from initial asking prices in those instances where sales have gone through... so it's perfectly possible for asking prices to be down but selling prices up, which is what seems to be happening... an acceptance amongst sellers that houses, for now, can & will sell at 10-20% off peak but not more, and a willingness amongst buyers to buy at these levels, whereas before i think you had sellers looking for 'almost peak' prices and buyers looking for vast discounts.

RM also isn't mix adjusted.

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Rightmove data is just pointless, I suspect many people are droping prices towards the end of the summer thats when the house will look at its best, the market has "recovered" (but most people dont think it will last), and theres just many properties with sellers ready to throw in the towel at 10% off peak valuations which werent ready to sell at 20% off.

The prospect of rising interest rates will be giving a lot of people the willies!

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Rightmove data is just pointless, I suspect many people are droping prices towards the end of the summer thats when the house will look at its best, the market has "recovered" (but most people dont think it will last), and theres just many properties with sellers ready to throw in the towel at 10% off peak valuations which werent ready to sell at 20% off.

The prospect of rising interest rates will be giving a lot of people the willies!

to be clear, RM is an index of the asking price of properties that are being put onto the market for the first time. it does not pick up any cuts to the asking price of proprties that have been hanging around for a while [another reason why it's meaningless].

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Which going forward points to lower sale prices and the end of the dead cat bounce?

RM has historically been a very bullish indicator; so IMO a -2.8% swing in RM is very bearish indeed.

+1

While Rightmove is definitely more wobbly than other indices, as an indicator of future direction it is useful.

Personally, judging by the huge number of properties coming on the market in my local area in the last few weeks, I think Rightmove are seeing the consequences of the 'wall of pent-up supply' hitting the market.

It will be interesting to see if the Halifax matches the Nationwide. Personally I think any rise in the Halifax will be much smaller than the Nationwide; as we are moving back into a split market with Southern silliness masking stagnation in the North and Midlands.

The interesting one to see will be the FT Acadametrics a couple of days after the Halifax. They use LR as a base, but modify it using the Haliwide and Rightmove numbers. So it will be interesting to see how much the Rightmove and Haliwide movements cancel each other out.

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