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Nationwide August Press Release

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Nationwide Aug 2013

UK house prices continued to rise at a fairly brisk pace in August, increasing by 0.6% overthe month. The annual rate of house price growth slowed a little, to 3.5% from 3.9%, but this was to be expected, as July’s figure was flattered by a low base for comparison. The three month on three month measure of house prices, which is a better measure of the underlying trend, rose by 1.4%, its strongest pace since mid-2010.

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The parts of the press release the media aren't quoting so much (although the BBC does!):

“While there have been encouraging signs that house building is starting to recover, construction is still running well below what is likely to be required to keep up with demand. New housing starts in England were up 33% in Q2 compared to the same period of 2012, but this is still 36% below the levels prevailing in 2007, which were already below that required to keep pace with household formation.

“The risk is that if demand continues to run ahead of supply affordability may become stretched. While house prices are still elevated compared with incomes, affordability is being supported by the ultra low level of interest rates. A typical mortgage payment for a first time buyer is currently equal to around 29% of disposable income, in line with the long term average.

“Recent guidance from the Bank of England’s Monetary Policy Committee (MPC), that it intends to keep interest rates on hold at least until the unemployment rate reaches 7%, may also help support confidence amongst potential buyers. However, despite this guidance, there is still considerable uncertainty as to the future path of Bank Rate. The Bank of England’s central forecast is that the unemployment rate will not reach the threshold level of 7%, but financial market indicators continue to point to a first rate hike in mid-2015.”

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The parts of the press release the media aren't quoting so much (although the BBC does!):

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I was just checking recently the 10 year fixes and in general they are about 5.5 to 6%

I want to see these guys, who pay currently 30% of the family income with 2.5% moving to 6% in 5 years max

happy days ...

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It's actually a fall in non-seasonal terms... -0.2%

I can understand seasoning August, sales normally drop off a cliff during the summer holidays. Slightly worried that they haven't this year, and also surprised by the nominal drop in view of continued sales.

At least their annual stat makes sense.......... 170514/ 164729 = +3.5%. I find the three month moving average from the Halifax non-sensical as it over or understates the real annual position. At the moment understating it by bring in 14 month old data to smooth things, God knows why.

Again Haliwide completely out of step with land registry....and the laggy is no longer justification for the indicies being out of step.

Edited by crashmonitor

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Perhaps the reason why August sales haven't dipped much in volume is because everyone's too skint to take a holiday abroad... but then you can't take out a taxpayer-backed 95% loan to buy a fortnight in Torremolinos.

Edited by Orsino

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Perhaps the reason why August sales haven't dipped much in volume is because everyone's too skint to take a holiday abroad... but then you can't take out a taxpayer-backed 95% loan to buy a fortnight in Torremolinos.

Meanwhile I tend to agree with rantrave that these figures are not that great, even thought the markets seem to think otherwise.........

http://www.rttnews.com/2180978/pound-strengthens-after-upbeat-uk-house-prices-consumer-confidence-data.aspx?type=cm&utm_source=google&utm_campaign=sitemap

But given the head of steam and the psychological effect of help to buy 2014, I expect an improving picture in the autumn.

Edited by crashmonitor

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However a close look at the more sober Land Registry figures (http://www.landregis...rices-and-sales) :

1) The average is being distorted by London sales.

2) Transaction volumes are still showing no signs of significant recovery.

landreg0713.JPG

Good news. In this wage/debt environment only a proper HPC will lead to recovering volumes IMO. The people who paid too much for their house are just going to have to suck it up or default.

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"Experts" have wet dreams about another housing bubble to help them out of dodgy investments, they won`t get one though.

True enough, there's little chance of any sustained and material house price inflation in the foreseeable future.

But equally there's little chance of a house price crash either. It's a sideways shuffle for the next decade or two, with owner occupancy rates shrinking all the time.

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True enough, there's little chance of any sustained and material house price inflation in the foreseeable future.

But equally there's little chance of a house price crash either. It's a sideways shuffle for the next decade or two, with owner occupancy rates shrinking all the time.

That would mean people who can`t sell houses putting their lives on hold for a decade or two, and rates staying low for a decade or two? Not really going to happen is it?

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That would mean people who can`t sell houses putting their lives on hold for a decade or two, and rates staying low for a decade or two? Not really going to happen is it?

Not unless the tooth fairy comes along to pay for it.

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