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ElPapasito

Nadeem Walayat Has Really Pulled His Finger Out This Time

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321 pages of his often controversial thinking on housing:

http://www.marketoracle.co.uk/pdf-d/UK-Housing-Market-2014-2018-by-Nadeem_Walayat.pdf

He has made a convincing case over many years for the hyperinflationary megatrend - which hasn't transpired in cost of living but he's been right about asset values being in an incredible bull market since the great crash.

I haven't read this latest tome yet, but will do so carefully over the next few days, and would appreciate sensible comment on what he is is forecasting.

You've got to admire his effort and willingness to make concrete predictions, some of which have turned out to be sound.

EP

Edited by ElPapasito

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You've got to admire his effort and willingness to make concrete predictions, some of which have turned out to be sound.

EP

As sound as a hyperinflated pound.

Got a note on a different harddrive what that house he uses as a background to a HPI future chart sold for... think it sold in 2011. From memory, such a house at £400,000+ in Sheffield... calculates like full of win to me.

UK-housing-market-ebook-cover-2013-380.g

Other buyers/investors been using the same thinking + not earning anything in bank, savers going to get wiped out, which has led to a lot of the reflation, and similar thinking holding of supply off the market from owners. £40K stamp duty to downsize from a house they could sell at £1m, to downsize to a house at £600K, apparently too much of a hardship.

No doubt the forum will be full of excuses for the recent buyers, when hpc comes, even when buyers have been goading non-owners, offering well above asking price without even viewing, pushing and falling over one another to buy, etc etc.

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It's all about government interference, exponential inflation and charts drawn from 2009 and extended to 180 using a set square.

Nothing about interest rates bottoming out, nothing about wages stagnation (well actually is said it gives the UK a competitive advantage!), nothing about planning regime change risks.

I wouldn't write it off completely and think it's worth a skim if your'e looking to buy.

I don't agree that 2013 is the start of a bull market and quite frankly there is nothing to drive it.

Nadeem claims that prices will be driven purely by government restriction of supply, government interference and mass immigration.

I would claim interest rates are not going to drive prices up, foreign and internal cash investors have been exhausted and supply restrictions have been easing, wages are still stagnant and rents continue to unperformed. It's looks like a continuation of the slow deflation.

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321 pages? Sounds like he's trying awfully hard.

My guess is he's getting out, and making lots of noise to try to buy enough breathing space to do so.

Either that or his up to his armpits in BTL and sudden property depreciation or interest rate rises would bankrupt him and finish his career.

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Either that or his up to his armpits in BTL and sudden property depreciation or interest rate rises would bankrupt him and finish his career.

Does he actually own any physical property? Love him or loathe him, he's an experienced investor, and I wouldn't expect him to go balls deep in anything quite so illiquid. I'd always just assumed he was in more derivative type investments, which would allow him to move a little faster if the winds changed against him.

That said, we can all make mistakes when the £ signs are flashing in our eyes - perhaps he's been buying a few of Fergus Wilson's cast-offs :)

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Its all about the LibLabCon cartel representing the forces of the land monopoly and City interests that leverage up existing property assets. The last thing they want is some idiot to start building.

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never heard of this guy but am reading through now. Some pretty interesting stuff and very honest about the failures of the political parties

Thanks for the link

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321 pages of his often controversial thinking on housing:

http://www.marketoracle.co.uk/pdf-d/UK-Housing-Market-2014-2018-by-Nadeem_Walayat.pdf

He has made a convincing case over many years for the hyperinflationary megatrend - which hasn't transpired in cost of living but he's been right about asset values being in an incredible bull market since the great crash.

I haven't read this latest tome yet, but will do so carefully over the next few days, and would appreciate sensible comment on what he is is forecasting.

You've got to admire his effort and willingness to make concrete predictions, some of which have turned out to be sound.

EP

What hyperinflationary mega-trend? The FTSE has done nothing since Feb 2013 when the last of the QE cash was handed out. Outside of London there's been no house price inflation worthy of the name. Net mortgage lending is barely positive because of the frantic deleveraging that's going on and wage inflation is non-existent. No doubt the govt will be forced to act again eventually, and when it does the rise in gilt yields that must accompany a proper re-inflation will kill the housing market stone cold.

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Does he actually own any physical property? Love him or loathe him, he's an experienced investor, and I wouldn't expect him to go balls deep in anything quite so illiquid. I'd always just assumed he was in more derivative type investments, which would allow him to move a little faster if the winds changed against him.

That said, we can all make mistakes when the £ signs are flashing in our eyes - perhaps he's been buying a few of Fergus Wilson's cast-offs :)

Have you not been reading his HPI stuff ????

I think he's hard in, followed his own theories, to a house in Sheffield, above £400K purchase price in 2011/12. Plenty of other buyers have, paying ever higher silly prices for the "security of property" / "obvious HPI because of population growth and higher demand" / "not earning anything in bank" and "savers will be doomed".

In Sheffield where Mr Walayat lives and very likely has his properties, prices are actually going DOWN by -7.3% a year biggrin.gif

He has another article on his site about the localised recent price crash in Sheffield

http://www.marketoracle.co.uk/Article45720.html

So ironically he's currently correct about the UK housing market apart from the one part he's in!

"Where Sheffield is concerned the following map highlights the possible high risk riot hot spots as a consequence of out of control immigration and the cultural catastrophe that could reach its ultimate consequences during the Summer of 2014."

Overlooking his implications of 'cultural catastrophe', in fairness you hear the excuse on HPC for HPI almost every day, from people who are supposed to be switched on; "population growth = HPI." Yeahhhh sure; and with that reasoning it's "Quick quick, race out and buy at a silly price."

House prices are set by what buyers are willing and able to pay for them. That requires good incomes, plentiful jobs, willingness to lend, willingness to borrow.

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Have you not been reading his HPI stuff ????

I think he's hard in, followed his own theories, to a house in Sheffield, above £400K purchase price in 2011/12. Plenty of other buyers have, paying ever higher silly prices for the "security of property" / "obvious HPI because of population growth and higher demand" / "not earning anything in bank" and "savers will be doomed".

I stopped doing more than skim reading any of his stuff when he began to take on the tone of some kind of illiterate evangelist to be honest. So he bought one house at 400k in Sheffield, and this qualifies him as an expert investor in the UK housing market :lol:

"On next week, Terry ******witt from Acacia Avenue explains how they're not making any more land".

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House in background chart last sold in early 2012 at £450,000 - although that's not to say he bought it, or owns it.

Edit by Venger: Link to sold price and archived listing pics removed.

We make our own decisions, and let the market play out.

My position is totally against his chart - great bull mega trend forecast thing.

Agree with you Knimbies.

Edited by Venger

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As a resident of Sheffield, who's been tracking prices of £400k+ houses for about 9 years I can tell you that Mr Walayat's opinions are nothing to get excited about.

Yes, asking prices for houses in the posh areas have got more optimistic. They've all been watching the BBC and talking at the school gate. But completed transaction prices have been nothing special and there are plenty of SSTC that pop up again. And again.

Most of the areas he's got coloured in red on his map don't have any Roma influx. The map represents his personal prejudices and political bent. The specific area he talks about - Page Hall, has been an Asian enclave for years and it is they who've been kicking off about the Roma coming along and not "fitting in". Made me smile, that did.

As for the inflation Mega Trend, he's been pushing that tired argument for yonks and all we're getting is a gradual erosion of the value of savings and a long overdue tightening of an economy built on credit.

Turning to his magnum opus, I got tired of flicking through it by the half way mark. His views about immigration issues make Nigel Farage look like a raving lefty and his overall political views make Gengis Khan seem like a rather reasonable chap. It reads like the continual rehash efforts of someone who keeps failing his Financial MBA and so re-writes and expands the same old rubbish for his dissertation. "Look, what I'm saying must be right, I've put it in bold, red font".

When you look on the Market Oracle website surprise, surprise, his articles are always among this week's or this month's most popular. He is, of course, the editor.

Everyone's welcome to their view but please, please, don't go off buying high end, over-priced property based on this guy's musings.

.

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I take it back (well, a small portion). The website registered address of his company is in one of the red areas on his map. So he might have seen the odd Roma walk past the window on the way to the shops. But if he owns a £400k house it's nowhere near that area.

.

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House prices are set by what buyers are willing and able to pay for them.

If only that were true. Prices are set by the willingness of the banks to lend money- if the bankers are feeling optimistic prices rise- if the bankers get nervous to lend prices go down- actual earnings act as a very loose guideline as to your debt carrying capacity- but it's banker mood swings that have the largest impact on the market.

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If only that were true. Prices are set by the willingness of the banks to lend money- if the bankers are feeling optimistic prices rise- if the bankers get nervous to lend prices go down- actual earnings act as a very loose guideline as to your debt carrying capacity- but it's banker mood swings that have the largest impact on the market.

Yes of course. The victims don't have any limit to what they'll pay for houses, if the banks will lend. They'd pay millions for a semi, on £25K a year, if banks will lend it them, and claim they "only wanted a home", because "renting is dead money", and then many non-owners offer excuses for the debtors when things turn.

Therefore, "willing and able."

Welcome borrowers to MMR etc, fragile recovery, and Gov still piling up the debt.

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UK-housing-market-ebook-cover-2013-380.g

That is it.

---

As a side note, if home prices break past 200K that would be new highs, and quite bullish, but not a moment earlier. I stand neutral right now.

Edited by 200p

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As sound as a hyperinflated pound.

Got a note on a different harddrive what that house he uses as a background to a HPI future chart sold for... think it sold in 2011. From memory, such a house at £400,000+ in Sheffield... calculates like full of win to me.

UK-housing-market-ebook-cover-2013-380.g

Wataloon has creatively edited out a decade of rampant house price inflation to the left of that chart in order to make the period 2009-13 look like a price floor rather than a ceiling.

Asset prices and current prices are already wildly out of equilibrium and yet we are expected to believe that the long-term effect of govt policy will be to drive them even further apart? Absurd.

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Wataloon has creatively edited out a decade of rampant house price inflation to the left of that chart in order to make the period 2009-13 look like a price floor rather than a ceiling.

Asset prices and current prices are already wildly out of equilibrium and yet we are expected to believe that the long-term effect of govt policy will be to drive them even further apart? Absurd.

Its now government policy. Confirmed by OBR. Absurd it may be, but happening it is.

(cant find the other Walayat thread)

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