If House Prices Are Going Down

[ExeC]

How comes the land reg figures show quite large rises in most areas ?

Is that because its showing average prices with 30-40% of FTB's missing hence price increases ?

I didnt think land reg fudge their figures?

[laurejon]

Prices are not going down.

What people are saying here is that they expect them to go down, but as yet their prediction is way off.

[Portent]

How comes the land reg figures show quite large rises in most areas ?

Is that because its showing average prices with 30-40% of FTB's missing hence price increases ?

I didnt think land reg fudge their figures?

<{POST_SNAPBACK}>

Correct. With fewer low-end properties being sold the Land reg figures will show slight increases. It's not really a fudge but just the way they work. It's important to look at what each figure means.

Also some areas are not falling yet. Although some are.

[CrashIsUnderWay]

Loserjean said

"Prices are not going down. What people are saying here is that they expect them to go down, but as yet their prediction is way off."

As usual, completely wrong.

The land reg figs are lagging by several months due to the time it takes to complete. The next set will probably show year on year falls across the country.

Most london / SE areas are collapsing fast. Its only the outer hebrides and those nutty welsh / geordies who are preventing it from looking really really REALLY bad. Here's Dr Bubbs fave ss...

FALLS OFF THE PEAK: Bellwether London Areas

Mon. : KensCh WestMn HmFulh Camden Wworth

Peak : 760,032 608,019 454,446 407,446 340,105

July . : 667,611 476,311 418,046 386,797 329,177

Aug : 633,670 452,908 420,885 364,390 325,177

Jl/A : - 5.08% - 4.91% + 0.68% - 5.79% - 1.22%

vsPk : -16.63% -25.51% - 7.39% -10.57% - 4.39%

-25%????? -16%???? If that aint a crash, what teh h3ll is it????

Loserjim has no more straws to clutch at, so he just whistles tunelessly in the dark. Sad case.

[London-loser]

Forgive me if I'm being thick here but didn't I see the Land Registry numbers posted on this forum that showed Q2 2005 figures were down on the Q3 2004 figures for the big picture (UK as a whole?).

Most people here argue the market peaked last summer... and few people doubt the LR numbers are a lagging indicator - so obviously they shouldn't peak until later.

And I agree that we need to be very aware of how each set of data is constructed (so crude average sales prices, like the LR numbers, can be heavily affected by the level of type of sales actually completing).

I'd also be wary of housing market stats generally in a stalling market - if there are lots of properties not selling (and therefore not correctly reflected in most of the datasets) then the picture quickly becomes very blurred.

[NJP]

Prices are not going down.

<{POST_SNAPBACK}>

The prices the LR figures represent were for sales that were agreed near the beginning of this year, and completed in Q2. All it tells us is that at the start of the year, average UK prices hadn't been falling over the previous 12 months. We knew that already.

That doesn't conflict with the fact that agreed prices are now lower than they were last summer. This will be reflected in the next two quarters' LR figures.

Even the mortgage lenders predict that prices will be lower at the end of this year than they were at the start. How's that supposed to happen if prices don't fall?

[planit]

Even the mortgage lenders predict that prices will be lower at the end of this year than they were at the start. How's that supposed to happen if prices don't fall?

<{POST_SNAPBACK}>

Quite right! This might be the first case where there is an overall fall but all the figures in between are positive.

[Jason]

The peak in Land Reg data was Q3 2004.

Comparing the last three quarters the average house has falled by 1.62%, i.e. from the peak.

In Q3 2005 we will have negative YOY inflation, if house prices stayed the same in Q3 the fall will be -1.62%, so if the figure is not negative houses would have to rise by £3,047.

The biggest fall so far was between Q3 2004 and Q4 2004 (fall of 2.69%), and this will probably be the case this year too (look at all the problems being mentioned in the news). If the fall was the same between between Q3 and Q4 2005 (i.e. £5,051) and figures remained the same in Q3 2005, YOY inflation would be -4.31% by the end of the year.

The problems with the Land Reg data is two fold:

1- Firstly (as others have said) they are very laggy, i.e. if you were to agree to buy a house today it will probably take 3months to complete, which means the figure would be realised in Q4 2005 data. Also, this data would be realised to the public in Feb 2006. This means any price you agree today won't be seen by the public until early 2006.

2- The data is unajusted (which I beleive is a good thing as the VIs can't fudge it), but if you look at the data you will see alot more bigger houses being sold compared to the norm (because the FTBers can't afford the flats/terraces ??), which in turn pushes the average up (as larger properties cost more).

[Randall Herbert]

In essence, Laurejon was talking out of his great big vested interest Rarse once more.

Won't these amateur BTL landlords never learn.

Prices in Scotland tumbling nicely already too.

[Red Baron]

Prices are not going down.

WRONG. Prices are falling fast. Do not believe the VI spin and the heavily manipulated statistics they churn out.

How do I know? Because I sold the last of my properties earlier this year. In 2004 it would have sold easily for £285K which was the benchmark price for similar properties. It finally sold this year for £240K - that's a 15.8% drop YOY. In Bedford, where I now rent, prices have fallen 5.1% in the last Q alone. (source: BBC house price statistics)

I am greatly relieved to be out of the market as we can expect big falls next year when it finally sinks in that property is not the one way street that people so fondly imagine.

Edited August 18, 2005 by Red Baron

[BandWagon]

Prices are falling in London, in some areas quite hard.

Oh, I know what's going to happen.

Sheffield and Newcastle will become more expensive than London because (insert bullsh!t reason here).

[numbersix]

My next door neighbour was asking £309,000 last year for his 4 bed detached house in South Dorset. He turned down an offer of £279,000 only to have to finally accept nearly £250.000 some 6 months later.

There is no doubt in my area that unless you drop price by £20 to £30K you will not sell !!

There a lots of houses for sale and very few selling. Oversupply + Less demand

= Price Reduction. Simple Economics......

Once the cheap mobile park homes become a viable option at £50k house prices could fall like a stone... Provided of course that the VI's don't stop this happening.

[FaTB]

Prices are not going down.

What people are saying here is that they expect them to go down, but as yet their prediction is way off.

<{POST_SNAPBACK}>

You could argue that prices are rising in some areas

You could argue that prices are dropping in some areas

But what is for sure is House price inflation has gone from about 20% to virtually 0% in 1 year. It will probably go negative nationwide before the end of the year.

Sales volumes are also drastically down in most parts of the country. (approx. 58 % in the area i live )

[surveyor]

It's very tiresome having to explain, in writing, to lenders why we tick the 'prices falling' box. The argument about falling prices in my area of the south east is 'so last year' that it's actually boring. Prices are, and have been falling at all levels. Slowly, naturally, but falling. I have yet to find one estate agent who doesn't repeat the mantra that properties will still sell only when the vendors realise this is not 2003/4 and are prepared to lower their prices. Time to move on I think.

[eek]

It's very tiresome having to explain, in writing, to lenders why we tick the 'prices falling' box. The argument about falling prices in my area of the south east is 'so last year' that it's actually boring. Prices are, and have been falling at all levels. Slowly, naturally, but falling. I have yet to find one estate agent who doesn't repeat the mantra that properties will still sell only when the vendors realise this is not 2003/4 and are prepared to lower their prices.  Time to move on I think.

<{POST_SNAPBACK}>

As you are here at the moment any chance of a short summary on the current market as you see it (i.e. dead, total dead, mummified or dinosaur)

[Guest rigsby II]

On the whole maybe prices aren't shifting, however seek out and ye shall find individual ones.

This was £169,590 last Saturday

http://www.rightmove.co.uk/viewdetails-640...pa_n=1&tr_t=buy

On Monday it went down to £145,000

The EA has just phoned me up to say I can have it for £132,000 - they are offering me the opportunity because the developer "just wants to move on to a new project" - I read that as he's sold 1 out of 7 and he's skint.

£37,950 off aint to bad - sounds like 20% off to me.

To whit I said, so whats the lowest he will accept then. Big sigh at the other end of the phone.

I'm actually becoming very bullish about being a bear.

Strange thing is its back to being advertised at £159,950 - looking for the weekend bounce...

[surveyor]

As you are here at the moment any chance of a short summary on the current market as you see it (i.e. dead, total dead, mummified or dinosaur)

<{POST_SNAPBACK}>

Most certainly eek!

The market in summer is of course always pretty quiet, and agents start dreaming of September, lengthening shadows across rolling fields, the early morning dew on spider's webs, and a return to school for the market to pick up again. This summer has been quieter than usual, no doubt, but not completely dead. However agents do confirm that the oft mooted figure of about 30% of sales not reaching completion is about right. This is a bit of a culture shock to some.

There are the odd cases where agents suggest that it's not been at all bad, but that needs to be seen in the context of a 'difficult market'. That would be the phrase most used.

My feeling is that the sales that have gone through have often been for reasons of work and stepping up the ladder due to growing families. The FTBs are as rare as rocking horse sh1t, and I can't remember the last one I did at this level. A few BTLs are still going through, but we can rarely value the rent to the 'required' rental figure which causes problems. Also almost all BTLs are of secondary and tertiary properties. No quality ones anymore.

And as I've posted many times before, the whole business is fuelled by lax/incompetent lending and unscrupulous mortgage brokers. It is riddled with fraud, and guess what, there's no mechanism for reporting it! In fact, exactly as it was in 1987/8. Strange that.

A lot of remortgaging (or as is now the norm on HPC 'alot'!) going on, presumably people coming out of deals. Most of these are problematical as we can rarely get to the valuation figure required and the applicants then fish around for another source. Which means we end up doing lots of transcriptions for the same property. In turn I expect they go lower down the chain of lenders, meaning more expensive deals.

Sept/Oct will be worth looking at for any significant upturn in transactions. You can pretty well write this year off for the bulls. My expectation is still for a fall in values by about a bedroom, more if the recession is a biggie. Rates haven't counted for so long now, I think they're almost out of the equation. See Charlie about this! Repos and bankruptcies going up and affecting mostly higher value properties too. Signing off for a holiday, cheers.

[Casual Observer]

  My expectation is still for a fall in values by about a bedroom,  .

<{POST_SNAPBACK}>

That's a great way of putting it!

[laurejon]

It is indeed.

what does it mean?.

[London-loser]

It is indeed.

what does it mean?.

<{POST_SNAPBACK}>

I take it to mean four bedroom places sell for the previous price of three beds, three bed places sell for what two beds used to fetch etc.

[George]

few properties on buckshaw villages have price reductions.

and whether or not other flats etc have reduced prices they have been for sale for 6 months +

http://makeashorterlink.com/?H3B1415AB

REDUCED PLEASE BUY NOW

Edited August 19, 2005 by George

[Casual Observer]

I take it to mean four bedroom places sell for the previous price of three beds, three bed places sell for what two beds used to fetch etc.

<{POST_SNAPBACK}>

That's the way I read it. Really puts price falls into context!