rantnrave Posted February 10, 2015 Share Posted February 10, 2015 Hedge funds betting on property share prices falling Foxtons, Savills and Zoopla are among property firms whose shares are being “shorted”. The Financial Times reported that several hedge funds have taken out short positions – “essentially bets that a company’s share price will fall”. The FT’s report says that the hedge funds are taking out bets specifically against the London housing market. The report adds: “While the bets are still relatively small, they represent the first sign that hedge funds have begun to move against the UK property market after several years of surging house prices, and the high-profile stock market listings of Foxtons and Zoopla. “London house prices have risen by 50% in the past five years, according to the Office for National Statistics, but the top end of the market has wobbled in recent months as a crackdown on foreign investors and the threat of a mansion tax stirred uncertainty. “Foxtons, a rapidly expanding chain of estate agents focused on expensive parts of the capital, went public in 2013. “It issued a profits warning last autumn, and its sales commission in the final quarter of 2014 slumped by 25% as a result of a ‘challenging’ market. “Zoopla’s subsidiary site PrimeLocation is the most prominent website for British luxury property sales, and a third of Zoopla’s revenues come from the London market, according to estimates by analysts at Exane BNP Paribas. “It has also been hit recently by the launch of a rival portal, OnTheMarket, by a group of disgruntled estate agents. “The bets against Zoopla are at their highest level since it listed in June 2014 and have risen by 42% in a month.” The FT report says that Berkeley Group, London’s largest housebuilder, is also having its shares shorted. http://www.propertyindustryeye.com/hedge-funds-betting-estate-agents-share-prices-falling/ Quote Link to comment Share on other sites More sharing options...
rantnrave Posted February 10, 2015 Share Posted February 10, 2015 to be fair their risk identification process is quite good; they just need to work more on their risk mittigation process going forward ... It was actually quite a memorable thread - Bland Unsight and another poster then identified a major error in Nationwide's accounting figures and pointed that out to them via Twitter. You couldn't make it up.Obviously the data in their house price index is infallible. Quote Link to comment Share on other sites More sharing options...
Digsby Posted February 10, 2015 Share Posted February 10, 2015 Just for fun, this morning I had a scan through my data to find the most heavily discounted listing for SW16, and the winner is: http://www.rightmove.co.uk/property-for-sale/property-48070139.html First observed 31/10/2014 (when I started, so it was on before that but I don't know how long or at what price) at £885,000. Under offer at £699,950, a 20% discount. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted February 10, 2015 Share Posted February 10, 2015 and how does 700k compare to other similar sales? was 900k a joke or realistic at the time? Is 700k still 30% above 2007 and 50% abive 2009? Quote Link to comment Share on other sites More sharing options...
Digsby Posted February 10, 2015 Share Posted February 10, 2015 The 2 most similar sales I can see are £455,000 in 2012 and £499,000 in 2006 (previously sold at £120,000 in 2004). So, £699,950 is almost 30% above the 2006 price. I think you can conclude that £885,000 was kite flying. Quote Link to comment Share on other sites More sharing options...
hackney Posted February 10, 2015 Share Posted February 10, 2015 Boom: http://www.dailymail.co.uk/news/article-112130/House-price-bubble-burst.html Gloom: http://www.propertywire.com/news/europe/central-london-property-prices-2015020910134.html Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 and how does 700k compare to other similar sales? was 900k a joke or realistic at the time? Is 700k still 30% above 2007 and 50% abive 2009? it is just enough to get under 2013/2014 prices to turn HPI indexes negative; rest will come Streatham is already in right direction: http://landregistry.data.gov.uk/app/hpi/view?from_m=1&from_y=2000&loc_0=Lambeth&loc_uri_0=http%3A%2F%2Flandregistry.data.gov.uk%2Fid%2Fregion%2Flambeth&m_hpi=1&m_vol=1&source=preview_form&to_m=1&to_y=2015 Quote Link to comment Share on other sites More sharing options...
hackney Posted February 10, 2015 Share Posted February 10, 2015 Ugh - can't edit the above but that DM link is ancient. So it's definitely all gloom Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted February 10, 2015 Share Posted February 10, 2015 The 2 most similar sales I can see are £455,000 in 2012 and £499,000 in 2006 (previously sold at £120,000 in 2004). So, £699,950 is almost 30% above the 2006 price. I think you can conclude that £885,000 was kite flying. Indeed. So not a 20% discount in fact. Quote Link to comment Share on other sites More sharing options...
Digsby Posted February 10, 2015 Share Posted February 10, 2015 Indeed. So not a 20% discount in fact. Yes, it is a 20% discount Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 (edited) Streatham and Clapham still the same; low interest and no viewings and offers: Streatham RM traffic for last 24h: 41% (7/17) of price reductions Clapham RM traffic for last 24h: 42% (8/19) of price reductions Edited February 10, 2015 by Damik Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted February 10, 2015 Share Posted February 10, 2015 Yes, it is a 20% discount In what way? It's much higher than prior sale prices. Are HPCers seriously convincing themselves that a sale price lower than kite flying asking price is a discount? OK. I want £1Bn for my property. No? OK. I'll accept £1mn. That's a huge discount. Quote Link to comment Share on other sites More sharing options...
Sancho Panza Posted February 10, 2015 Share Posted February 10, 2015 (edited) In what way? Technically speaking it is a discount on the asking price,but you have a valid point about celebrating a discount on a kite . http://www.rightmove.co.uk/property-for-sale/property-50466446.html Even a 20% discount on asking doesn't make this old folks flat attractive. Edited February 10, 2015 by Sancho Panza Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 In what way? It's much higher than prior sale prices. Are HPCers seriously convincing themselves that a sale price lower than kite flying asking price is a discount? OK. I want £1Bn for my property. No? OK. I'll accept £1mn. That's a huge discount. How do you know it would not sell for the kite flying asking price? It did in 2013. In the rising market sooner or later the kite flying asking price is the sold price ... But it does not work in the falling market ... Quote Link to comment Share on other sites More sharing options...
LondonBooming Posted February 10, 2015 Share Posted February 10, 2015 I think EA are getting desperate, i am getting phone calls every day, to come in to the branch and go through their inventory. Has the market turn? Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 I think EA are getting desperate, i am getting phone calls every day, to come in to the branch and go through their inventory. Has the market turn? where, please? Quote Link to comment Share on other sites More sharing options...
Digsby Posted February 10, 2015 Share Posted February 10, 2015 In what way? It's much higher than prior sale prices. Are HPCers seriously convincing themselves that a sale price lower than kite flying asking price is a discount? OK. I want £1Bn for my property. No? OK. I'll accept £1mn. That's a huge discount. Yes, you are correct, the price of £1m was discounted from £1b. Whether the original price was too high to achieve a sale is irrelevant, it was an asking price that did not achieve a sale and was lowered. Did you see me claim anywhere that this represented a fall in sold prices? If you inferred that from my factual post then that is your problem not mine. It hasn't even sold. Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted February 10, 2015 Share Posted February 10, 2015 How do you know it would not sell for the kite flying asking price? It did in 2013. In the rising market sooner or later the kite flying asking price is the sold price ... But it does not work in the falling market ... All we know is what he told us: "The 2 most similar sales I can see are £455,000 in 2012 and £499,000 in 2006 (previously sold at £120,000 in 2004). So, £699,950 is almost 30% above the 2006 price. I think you can conclude that £885,000 was kite flying." Where do you get the 900k sale in 2013? Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted February 10, 2015 Share Posted February 10, 2015 Yes, you are correct, the price of £1m was discounted from £1b. Whether the original price was too high to achieve a sale is irrelevant, it was an asking price that did not achieve a sale and was lowered. Did you see me claim anywhere that this represented a fall in sold prices? If you inferred that from my factual post then that is your problem not mine. It hasn't even sold. I thought you said it sold at 700k and this was a discount? Must be me then. Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 Where do you get the 900k sale in 2013? If the crazy 30% rises in 2013 continued it could easilly sell in 2014. But the market has turned ... Quote Link to comment Share on other sites More sharing options...
Digsby Posted February 10, 2015 Share Posted February 10, 2015 I thought you said it sold at 700k and this was a discount? Must be me then. I said it went under offer at £699,950 and that was discounted from £885,000. I deliberately offered no interpretation, and also said it was "just for fun" to indicate that I attached no significance to it, though I accept some forum members might interpret that as meaning "look, what fun, houses are selling for less than previously sold prices", so it might not be just you. In case you haven't been following my posts in this thread, my interest at moment is in determining whether the price reductions reported throughout the thread represent real falls compared to previous prices. My findings so far are that in SW16, most sales are happening at the low end of market, and at 100% of initial asking prices, but across the whole market, current asking prices are 1.5% below initial asking prices, and "discounts" in prices are happening across the market but tend to be towards the top end, with an average discount being in the 5% range. Average asking prices appear to have dipped and may be slowly climbing again but there is not enough data yet to confirm that. I've yet to reach any conclusions, but I enjoy posting the facts I am discovering for other members information, and for potential points of discussion in case other members might offer alternative interpretations. Quote Link to comment Share on other sites More sharing options...
LondonBooming Posted February 10, 2015 Share Posted February 10, 2015 where, please? My local Madison Brook branch in Rolay Victoria. Quote Link to comment Share on other sites More sharing options...
Damik Posted February 10, 2015 Author Share Posted February 10, 2015 My local Madison Brook branch in Rolay Victoria. OK, tell them that Prime London just started to fall; based on the LR; what they think ... Consider this as an exercise in social psychology ... Quote Link to comment Share on other sites More sharing options...
Neverwhere Posted February 10, 2015 Share Posted February 10, 2015 It was actually quite a memorable thread - Bland Unsight and another poster then identified a major error in Nationwide's accounting figures and pointed that out to them via Twitter. You couldn't make it up. Obviously the data in their house price index is infallible. Thanks, that reminded me which thread it was. I'd totally forgotten that the apparent uptick in lending against London had actually been an error in Nationwide's annual report. 31.5% of their total book still seems somewhat high for a national lender though. Agreed that their index is clearly fallible Quote Link to comment Share on other sites More sharing options...
Guest_northshore_* Posted February 11, 2015 Share Posted February 11, 2015 Good find. Disclosed >=0.5% shorts of, for example, foxtons: http://www.shorttracker.co.uk/company/GB00BCKFY513/all Quote Link to comment Share on other sites More sharing options...
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