Residential Property Price Index exclusive thread

[2buyornot2buy]

I listed the source of the tables. Banks look at what people can afford. Total income less total costs or expenses.

why is it I can borrow 5 times joint earnings with say halifax and only 2 with HSBC.

Does HSBC have a different grasp of maths?

[BelfastVI]

why is it I can borrow 5 times joint earnings with say halifax and only 2 with HSBC.

Does HSBC have a different grasp of maths?

Perhaps HSBC know all about you. I have no idea. It may also be a difference in approach to NI from each orginsation.

[Belfast Boy]

hmmmm...

[BelfastVI]

hmmmm...

Very good. It's from 2010

[Bergy100]

3rd Quarter 2013

http://www.dfpni.gov.uk/lps/ni_rppi_statistical_report_q3_2013.pdf

Results from the report show that:

Between Q2 (April - June) 2013 and Q3 (July - September) 2013 residential property prices increased by 2% - the second consecutive quarterly increase;

For the second consecutive quarter property prices either increased or were steady across all property types (detached, semi-detached, terraced and apartments);

Residential property prices increased by 1% over the year from Q3 2012 to Q3 2013;

Prices of residential property sold today are under half of their Q3 2007 peak value (a 54% fall); and

There were 4,001 verified residential Northern Ireland property sales recorded in Q3 2013. This is the highest number of quarterly sales recorded since 2007.

[yadayada]

3rd Quarter 2013

http://www.dfpni.gov.uk/lps/ni_rppi_statistical_report_q3_2013.pdf

Results from the report show that:

Between Q2 (April - June) 2013 and Q3 (July - September) 2013 residential property prices increased by 2% - the second consecutive quarterly increase;

For the second consecutive quarter property prices either increased or were steady across all property types (detached, semi-detached, terraced and apartments);

Residential property prices increased by 1% over the year from Q3 2012 to Q3 2013;

Prices of residential property sold today are under half of their Q3 2007 peak value (a 54% fall); and

There were 4,001 verified residential Northern Ireland property sales recorded in Q3 2013. This is the highest number of quarterly sales recorded since 2007.

So there we are. It's all over. The Great Crash 2007-2013. Or a bit like the Great War 1914 - 1917?

Any thoughts?

Edited November 20, 2013 by yadayada

[Shotoflight]

So there we are. It's all over. The Great Crash 2007-2013. Or a bit like the Great War 1914 - 1917?

Any thoughts?

A 1% increase in the last 12 months. Woo hoo - crack open the champoo.

9% lower than 2005. Inflation probably averaging above 2.5% in past 12 months.

Reposessions up 20%. Pay going backwards.

Government backed 95% mortgages. Pobably some of the cheapest mortgages ever.

Hard to predict - who knows how much more desperate the Govt will get or for how much longer debtors will get a fair wind locally, nationally, globally.

I'm not convinced anything is over. The worst (or best?) may be, but there could be a few more skirmishes in this 'war'.

There is a lot of toxicity out there, not only in the "housing market". Nama and Ulster Bank sitting on their hands for example.

[yadayada]

A 1% increase in the last 12 months. Woo hoo - crack open the champoo.

9% lower than 2005. Inflation probably averaging above 2.5% in past 12 months.

Reposessions up 20%. Pay going backwards.

Government backed 95% mortgages. Pobably some of the cheapest mortgages ever.

Hard to predict - who knows how much more desperate the Govt will get or for how much longer debtors will get a fair wind locally, nationally, globally.

I'm not convinced anything is over. The worst (or best?) may be, but there could be a few more skirmishes in this 'war'.

There is a lot of toxicity out there, not only in the "housing market". Nama and Ulster Bank sitting on their hands for example.

I have to agree, but check out the crowing over on MSE forum. The helicopter is on the roof, and the last property bears in NI are clinging to its runners. Or something.

[BelfastVI]

A 1% increase in the last 12 months. Woo hoo - crack open the champoo.

9% lower than 2005. Inflation probably averaging above 2.5% in past 12 months.

Reposessions up 20%. Pay going backwards.

Government backed 95% mortgages. Pobably some of the cheapest mortgages ever.

Hard to predict - who knows how much more desperate the Govt will get or for how much longer debtors will get a fair wind locally, nationally, globally.

I'm not convinced anything is over. The worst (or best?) may be, but there could be a few more skirmishes in this 'war'.

There is a lot of toxicity out there, not only in the "housing market". Nama and Ulster Bank sitting on their hands for example.

We could get tied up in denial and that's understandable. We had plenty of that in the past.

However, the Government backed 95% (H2B) Mortgages that you mention , ranging from 4.9% to 5.5% (what I have heard to date) are probably not, anywhere near the cheapest mortgage ever.

Repossessions will continue, even a 5% increase in prices will not stop that and price increases could in certain circumstances encourage repossessions. However, the repo's are being bought up, the majority of houses are being sold at the auctions with bidding occurring.I imagine that is where the majority of the price increases recorded in the NIRPPI report are coming from. The worst of this was over in 2009. the second part has taken a lot longer than I thought but it too would appear to be coming to an end.

Indeed there could be skirmishes and major ones to come. London prices have continued to grow and the £600k H2B product seemed madness in that location. in their defence they will claim that London prices are being fuelled by foreign investment and they will not be using H2B or any UK loans for that matter. I do not know the London Market, and therefore am not qualified in any way to really comment upon it but would appear to have bubble wrote all over it. If anything were to happen to that market, particularly in the next 12 months, I would worry what would happen to the local mortgage market. If, on the other hand the recovery, as they call it, were to bed in then perhaps the local market and others in Scotland , Wales and the north of England could survive as they have long since detached themselves from London.

It is however my single concern.

I don't think NAMA or UB would agree they have sat on their hands. As next year unfolds they may well regret some of the earlier moves they have made.

[Shotoflight]

We could get tied up in denial and that's understandable. We had plenty of that in the past.

However, the Government backed 95% (H2B) Mortgages that you mention , ranging from 4.9% to 5.5% (what I have heard to date) are probably not, anywhere near the cheapest mortgage ever.

You are right about the HTB interest rates. I have read other banks outside the scheme - or perhaps building societies - are more competitive on interest rates. Nudged no doubt by HTB. The 5% deposit is the thing. The new normal with a 320 yr low base rate. What could possibly go wrong.

As for NAMA & Ulster - Sammy and others have begged for no firesale and forbearance - they, and others, appear to have complied.

I also think the Ulster will be in line for a very big and unpleasant surprise within the next 6 months as they are purged from mainstream RBS - I can't see a pain free solution and earlier inaction is simply a stay of execution. Not sure what effect this will have on their mort book or property portfolio - in terms of the wider NI market. HQ must be having a good laugh at the momentum debacle, for example.

[BelfastVI]

How did momentum become a debacle?

[Shotoflight]

How did momentum become a debacle?

How much has it cost the bank? It was an insurance gamble to entice buyers with the bank taking the risk that there would be little if any further price falls and attempting to imbue confidence in buyers (was it new build only?) .

Perhaps it was such a success they'll roll out momentum part 2?

There' s not much info on it that can find. Anything you can share?

[BelfastVI]

How much has it cost the bank? It was an insurance gamble to entice buyers with the bank taking the risk that there would be little if any further price falls and attempting to imbue confidence in buyers (was it new build only?) .

Perhaps it was such a success they'll roll out momentum part 2?

There' s not much info on it that can find. Anything you can share?

The bank took no risk (the reason why I didn't like it much). Have you any info that you can find to back up this notion.

[Shotoflight]

The bank took no risk (the reason why I didn't like it much). Have you any info that you can find to back up this notion.

I assume their risk was insured but I don't know - do you think the developers took the risk/hit?

What % of the developers involved went bust? At the time it looked to me like a desperate gamble to prevent lowering prices and some of the developers involved were on loose foundations at that stage already.

Either which way it was a wrong call, in my opinion. When was it killed off?

[2buyornot2buy]

The bank took no risk (the reason why I didn't like it much). Have you any info that you can find to back up this notion.

Who took the risk? Certainly not all those limited liability companies signed up to momentum that are now bust.

Pattons et al.

Quite a few momentum developers are now bust.

Edited November 26, 2013 by 2buyornot2buy

[Shotoflight]

Who took the risk? Certainly not all those limited liability companies signed up to momentum that are now bust.

Pattons et al.

Quite a few momentum developers are now bust.

debated here before - must reacquaint myself.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=151465

Ulster bank webpage linked in above thread, and listing participating developers, now deleted.

Why did they not just reduce their prices?

Edited November 26, 2013 by Shotoflight

[2buyornot2buy]

debated here before - must reacquaint myself.

http://www.housepricecrash.co.uk/forum/index.php?showtopic=151465

Ulster bank webpage linked in above thread, and listing participating developers, now deleted.

Why did they not just reduce their prices?

Someone bought a semi in portadown for 140k using the scheme. Jesus I wonder who took that hit?

The original list has been updated with all the bust developers removed.

Edited November 26, 2013 by 2buyornot2buy

[Shotoflight]

I think the word gimmick was the one I was searching for.

How would the banks and developers measure the success of this gimmick? On what objectives, targets or metrics?

Is it fair to say it backfired?

BVI - was the only reason you disliked it because you feel the bank didn't take the hit?

[BelfastVI]

I think the word gimmick was the one I was searching for.

How would the banks and developers measure the success of this gimmick? On what objectives, targets or metrics?

Is it fair to say it backfired?

BVI - was the only reason you disliked it because you feel the bank didn't take the hit?

The developers set aside the 15%

The banks took no rusk.

If the prices fell, which they did I part then the purchasers got their mortgages reduced by that % up to 15%. As I said at the time it was a great deal for the purchaser. It was also a great deal for the bans.

I don't believe it backfired. If you have any information or evidence to show it backfired then please let us know.

Edited November 29, 2013 by BelfastVI

[Shotoflight]

The developers set aside the 15%

The banks took no rusk.

If the prices fell, which they did I part then the purchasers got their mortgages reduced by that % up to 15%. As I said at the time it was a great deal for the purchaser. It was also a great deal for the bans.

I don't believe it backfired. If you have any information or evidence to show it backfired then please let us know.

And if the developers went bust?

It doesn't appear to have been repeated or expanded.

It smacks of desperation.

Strangely, its 'success' is not widely publicised.

How much did/does it cost to publicise and administer? Would reducing house prices not have been a more successful/appropriate/realistic approach? How come no=one has followed Ulster's lead?

Edited November 29, 2013 by Shotoflight

[2buyornot2buy]

I can't get my head around this Momentum if it works the was you say it does.

Have I got this right?

The scheme is voluntary?

The developer provides 15% of capital?

It is only available on developments Ulster Bank has provided the developer capital?

Why do developers offer it? They aren’t forced to, you maintain developers dropped their prices to crash level before the resale market so provide value for money. Why not just offer to pay the deposit?

Were developers basically gambling prices wouldn’t drop 15%?

I know that no other bank offers vendor gifted deposits, is Ulster Bank basically saying to developers that they are the only option available if they want to offer vendor gifted deposits?

Does the developer give Ulster bank 15% of the sales price in return for them offering the mortgage? Essentially they are the only lender that will.

[BelfastVI]

And if the developers went bust?

It doesn't appear to have been repeated or expanded.

It smacks of desperation.

Strangely, its 'success' is not widely publicised.

How much did/does it cost to publicise and administer? Would reducing house prices not have been a more successful/appropriate/realistic approach? How come no=one has followed Ulster's lead?

It did its job when it was needed.

The money was handed over on the completion of the houses so it is irrelevant if the builder went bust later.

Not many builders liked it as they were not recovering all the build cost, therefore it could not be used to build new stock.

I think its still available, but due to the above it's not really used.

[BelfastVI]

I can't get my head around this Momentum if it works the was you say it does.

Have I got this right?

The scheme is voluntary?

The developer provides 15% of capital?

It is only available on developments Ulster Bank has provided the developer capital?

Why do developers offer it? They aren’t forced to, you maintain developers dropped their prices to crash level before the resale market so provide value for money. Why not just offer to pay the deposit?

Were developers basically gambling prices wouldn’t drop 15%?

I know that no other bank offers vendor gifted deposits, is Ulster Bank basically saying to developers that they are the only option available if they want to offer vendor gifted deposits?

Does the developer give Ulster bank 15% of the sales price in return for them offering the mortgage? Essentially they are the only lender that will.

I think you have most of that right. The houses were sold at market price. the advantage to the purchaser was they were getting 100% loan, paying interest on only 85% and it only stepped up to the full amount if the prices were the same or higher in 5 years.

I think it was a good deal for the purchasers who were in very short supply in 2008/2009.

Developers cant offer to pay deposits - this, in a way was a method of getting around that.

[2buyornot2buy]

I think you have most of that right. The houses were sold at market price. the advantage to the purchaser was they were getting 100% loan, paying interest on only 85% and it only stepped up to the full amount if the prices were the same or higher in 5 years.

I think it was a good deal for the purchasers who were in very short supply in 2008/2009.

Developers cant offer to pay deposits - this, in a way was a method of getting around that.

Vendor deposits were available then. Still begs the question why did developers volunteer. Unless they were coerced.

[BelfastVI]

Vendor deposits were available then. Still begs the question why did developers volunteer. Unless they were coerced.

The developer cant pay purchaser deposits. this was effectively a 100% mortgage with a cash backed gurantee to cover any fall in price over 5 years up to a max of 15%.

At the time it sold houses. Any yes you could say the developers were coerced.