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The Masked Tulip

Central London Homes Hit As Summer Lull Takes A Toll

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Imagine all those Land Rover Vogue owning rich folk scrambling for the exits.

What a sight.

Like those rich folk standing bewildered outside,

after hearing about the collapse of the Bernie Madoff Ponzi Fund.

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Is it me or are they tring to insinuate that a "summer lull" is something that's more or less to be expected?

Other than possibly in the slide of 2008 has there ever been a recorded instance of both transactions and prices not being considerably higher in the summer months?

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Is it me or are they tring to insinuate that a "summer lull" is something that's more or less to be expected?

Other than possibly in the slide of 2008 has there ever been a recorded instance of both transactions and prices not being considerably higher in the summer months?

On seasonally adjusted indices prices never normally fall throughout the summer. Just rise less fast. Non SA indices such as rightmove does normally show some negative figures in July and august but never falls (not even in 08!) in October.

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Our index has just been released and shows Prime Central London has reached new highs in Q3. The index uses actual transactions from all leading estates agents from the date of exchange (many of the sales have not even completed) and is independently compiled by the LSE. Link:

http://supadu.com/images/ckfinder/54/pdfs/Prime%20Central%20London%20Property%20Graph%20and%20Index%20October%202010.pdf

This should come as no surprise as there are negative real interest rates, the stockmarket is in the ascendancy (for now) and bonuses are continued to being paid. Currently owners of property in London will only sell at their price as many have little to no mortgage and therefore no impetus to sell. Agents are reporting a fall in the number of buyers and a rise in the number of instructions, which suggests prices may soften in Q4.

Nationally the market remains above fundamentals (affordability, house price to earnings). As Keynes said "Markets can stay irrational longer than you can stay solvent".

James Wyatt FRICS

John D Wood & Co.

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Our index has just been released and shows Prime Central London has reached new highs in Q3. The index uses actual transactions from all leading estates agents from the date of exchange (many of the sales have not even completed) and is independently compiled by the LSE. Link:

http://supadu.com/images/ckfinder/54/pdfs/Prime%20Central%20London%20Property%20Graph%20and%20Index%20October%202010.pdf

This should come as no surprise as there are negative real interest rates, the stockmarket is in the ascendancy (for now) and bonuses are continued to being paid. Currently owners of property in London will only sell at their price as many have little to no mortgage and therefore no impetus to sell. Agents are reporting a fall in the number of buyers and a rise in the number of instructions, which suggests prices may soften in Q4.

Nationally the market remains above fundamentals (affordability, house price to earnings). As Keynes said "Markets can stay irrational longer than you can stay solvent".

James Wyatt FRICS

John D Wood & Co.

Oohh an estate agent! One that knows who Keynes is at that! What do you think of the rightmove index which shows asking prices for London properties have fallen over 7% in the last three months?

Also the pound has strenthened a fair bit the last month surely that will be putting off those foriegn buyers...

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Our index has just been released and shows Prime Central London has reached new highs in Q3. The index uses actual transactions from all leading estates agents from the date of exchange (many of the sales have not even completed) and is independently compiled by the LSE. Link:

http://supadu.com/images/ckfinder/54/pdfs/Prime%20Central%20London%20Property%20Graph%20and%20Index%20October%202010.pdf

This should come as no surprise as there are negative real interest rates, the stockmarket is in the ascendancy (for now) and bonuses are continued to being paid. Currently owners of property in London will only sell at their price as many have little to no mortgage and therefore no impetus to sell. Agents are reporting a fall in the number of buyers and a rise in the number of instructions, which suggests prices may soften in Q4.

Nationally the market remains above fundamentals (affordability, house price to earnings). As Keynes said "Markets can stay irrational longer than you can stay solvent".

James Wyatt FRICS

John D Wood & Co.

James,

Whats your definition of 'Prime'?

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Good point on asking prices and as my email stated agents are reporting a softening of the market and this should come out in the Q4 data. Our indices track pounds per square foot at exchange so actual transactions in the market place. It is interesting to note our indices also show far greater volatility and a more significant fall after Lehmans and greater rebound.

Recommended reading for those interested

Irving Fisher "Debt Deflation Theory of Great Depressions" 1933 Econometrica pp337-357

Ortalo-Magne, Francois and Merlo, Antonio in "Bargaining over Residential Real Estate Evidence from England" Penn Institute For Economic Research 2003

Flowerdew, Robin Timothy Nicholas "The logic of the decision process in residential choice" 1977 Northwestern University

Glower, Michel and Haurin, Donald with Hendershott, Patric "Selling Time and Selling Price: The impact of seller motivation" www.jrer.com 2003

Herring, Richard and Watchter, Susan "Bubbles in Real Estate Markets" 2002 Federal Reserve Bank of Chicago and World Bank

Working paper 300 from the BIS is a good analysis of the fiscal predicament.

James Wyatt FRICS

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James,

Whats your definition of 'Prime'?

Didn't realise it's prime only. I think Kylie Minogue might disagree with you James.

Edited by Pent Up

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Good point on asking prices and as my email stated agents are reporting a softening of the market and this should come out in the Q4 data. Our indices track pounds per square foot at exchange so actual transactions in the market place. It is interesting to note our indices also show far greater volatility and a more significant fall after Lehmans and greater rebound.

Recommended reading for those interested

Irving Fisher "Debt Deflation Theory of Great Depressions" 1933 Econometrica pp337-357

Ortalo-Magne, Francois and Merlo, Antonio in "Bargaining over Residential Real Estate Evidence from England" Penn Institute For Economic Research 2003

Flowerdew, Robin Timothy Nicholas "The logic of the decision process in residential choice" 1977 Northwestern University

Glower, Michel and Haurin, Donald with Hendershott, Patric "Selling Time and Selling Price: The impact of seller motivation" www.jrer.com 2003

Herring, Richard and Watchter, Susan "Bubbles in Real Estate Markets" 2002 Federal Reserve Bank of Chicago and World Bank

Working paper 300 from the BIS is a good analysis of the fiscal predicament.

James Wyatt FRICS

How are you valuing currently? Are you taking this 'softening' into account in your valuations? I mean your agency specifically? Do you feel you need to dampen expectations somewhat in order to maintain transaction levels?

Thanks. :)

Edited by Pent Up

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Good point on asking prices and as my email stated agents are reporting a softening of the market and this should come out in the Q4 data. Our indices track pounds per square foot at exchange so actual transactions in the market place. It is interesting to note our indices also show far greater volatility and a more significant fall after Lehmans and greater rebound.

Recommended reading for those interested

Irving Fisher "Debt Deflation Theory of Great Depressions" 1933 Econometrica pp337-357

Ortalo-Magne, Francois and Merlo, Antonio in "Bargaining over Residential Real Estate Evidence from England" Penn Institute For Economic Research 2003

Flowerdew, Robin Timothy Nicholas "The logic of the decision process in residential choice" 1977 Northwestern University

Glower, Michel and Haurin, Donald with Hendershott, Patric "Selling Time and Selling Price: The impact of seller motivation" www.jrer.com 2003

Herring, Richard and Watchter, Susan "Bubbles in Real Estate Markets" 2002 Federal Reserve Bank of Chicago and World Bank

Working paper 300 from the BIS is a good analysis of the fiscal predicament.

James Wyatt FRICS

Thanks for those. Looks like some good reading in there.

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  • 150 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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