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rantnrave

Nationwide Up All Of 0.1%

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Indeed..... the buttock clenching can go on no longer... let the panic consume the market like a fountain of slurry.

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Or perhaps our free market government will just dream up another prop :(

How about a mandatory insurance that they can also tax us for - say 'Rent premium tax' which can be used to insure your BTL rentier landlord against defaulting when interest rates rise, thus 'protecting hard-working-families unable to get their feet on to the housing ladder'...

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Whilst I agree that all the signs are there for a top, don't forget that we are in the traditional flat spot of the market. I wouldn't be too confident we aren't going to see more increases yet into the Autumn *

* based on my historical forecasting ability that probably means a monumental crash has just started.

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House prices gained just 0.1 percent month-on-month, the slowest pace since April last year and down from 1.0 percent in June. Economists polled by Reuters had expected a rise of 0.5 percent. ...Bank of England Deputy Governor Ben Broadbent said in a Bloomberg interview published earlier on Thursday, however, that "the edge is coming" off Britain's housing.

http://uk.reuters.com/article/2014/07/31/uk-britain-housing-nationwide-idUKKBN0G00F720140731

and the other (household debt hit new record in June, £1.45 Trillion) http://www.bloomberg.com/news/2014-07-30/boe-s-broadbent-says-edge-is-coming-off-u-k-housing.html

What does he mean here? “Let’s not forget that in 2007...... " pre the cruch? Or after?? Exaggerated?

Edited by Venger

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July's HPI of 372.2 is identical to that released in June, but the June figure has since been revised down to 372.0 in today's release which is just enough to round to an increase of 0.1% (it is 0.053%). For all that it matters.

Will be pretty interesting to see what happens from here, given the anecdotal evidence of a marked slowdown in London.

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July's HPI of 372.2 is identical to that released in June, but the June figure has since been revised down to 372.0 in today's release which is just enough to round to an increase of 0.1% (it is 0.053%). For all that it matters.

Will be pretty interesting to see what happens from here, given the anecdotal evidence of a marked slowdown in London.

Wonder if now is a good time to mock my colleague who bought a house last month? ;)

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Wonder if now is a good time to mock my colleague who bought a house last month? ;)

No point, unless he's an annoying hpi fool, and unless we're certain about hpc, which we're not. We make our own decisions, and I've long been wrong into the boom, and during the global QE/0.5% to the extent they'll allow house prices to reflate.

I want to buy at a price where debt, isn't as much of a concern, as it would be, for me, buying in this market. Allowing monies to be spent in the economy, go into pension, and onto family. A price point where I can buy a house, and still hope house prices continue to fall for future generations.

w00519772

Join Date: Aug 2013

Posts: 305

Exchanged and Completed

22-07-2014

I exchanged and completed yesterday. My house search is finally over. Just thought I would say thanks for all the useful answers I was provided with on here over the last four months.

..Anyway the first article I read after completing was this: http://www.telegraph.co.uk/finance/economics/10979391/UK-house-prices-fall-for-the-first-time-this-year.html Apparently asking prices fell by 1.9% in East Midlands for July. However, I am trying not to worry too much about this because:

1) It is the normal seasonal trend for July

2) World Cup Brazil

Can anyone speculate why East Midlands was the biggest hit in this report? I bought in Lincoln, which is one of the main cities in East Midlands.

http://forums.moneysavingexpert.com/showthread.php?t=5021919

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July's HPI of 372.2 is identical to that released in June, but the June figure has since been revised down to 372.0 in today's release which is just enough to round to an increase of 0.1% (it is 0.053%). For all that it matters.

Will be pretty interesting to see what happens from here, given the anecdotal evidence of a marked slowdown in London.

The usual trick. Penk around with last month's number rather than generate a negative headline. As you say, hard to see how they can maintain the pretense going forward given what's happening in London. Presumably, the VI shills at the BBC etc. will start using yoy figures exclusively.

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The usual trick. Penk around with last month's number rather than generate a negative headline. As you say, hard to see how they can maintain the pretense going forward given what's happening in London. Presumably, the VI shills at the BBC etc. will start using yoy figures exclusively.

They are buying themselves another month so they can exit the market. Once exited they will commence on the bust, so they can buy up asset cheaply.

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http://uk.reuters.com/article/2014/07/31/uk-britain-housing-nationwide-idUKKBN0G00F720140731

and the other (household debt hit new record in June, £1.45 Trillion) http://www.bloomberg.com/news/2014-07-30/boe-s-broadbent-says-edge-is-coming-off-u-k-housing.html

What does he mean here? “Let’s not forget that in 2007...... " pre the cruch? Or after?? Exaggerated?

Full quote

“Let’s not forget that in 2007 official interest rates were almost 6 percent and the housing market was not frankly a central part, certainly not mortgage losses for banks, a central part of the story on the financial crisis,” he said. “That can be exaggerated.”

He means that the banks can take a house price crash today, because they probably could have weathered one in 2007. What they couldn't weather was the fact that their funding model required that other banks were willing to lend to each other, and they weren't.

That's pretty striking to have an in-post Deputy Governor talking about the edge coming off prices and the consequences of mortgage losses for the banks being exaggerated.

Two bearish pieces in the Telegraph today

Shrinking Help to Buy deposits spark negative equity fears

Is the housing bubble finally starting to burst?

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TO RECAP ON WHERE WE ARE:

The government introduced a scheme to help buyers by giving them a 20% deposit.

House prices go up 20% and grind to a halt.

Money lender, sellers and estate agents are better off.

Buyers are now even worse off than before and in an even more precarious financial position. This has the a real negative effect on the economy.

Help to Buy, as we expected is help to banks/sellers/the rich/the old voters/anyone but buyers. Do they really expect pensioners to next pump this bubble up with their hard earned pensions ?

Young people need to demand the removal of this prop immediately and for prices to return to their pre-HTB levels and allowed to continue their recovery ( to low affordable levels ) naturally without government intervention. This madness must end.

Anything else, it corrupt/fraud.

Edited by TheCountOfNowhere

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TO RECAP ON WHERE WE ARE:

The government introduced a scheme to help buyers by giving them a 20% deposit.

House prices go up 20% and grind to a halt.

...

If it was Help to Buy that was the main explanatory factor, then how do you explain that although there has been plenty of Help to Buy in the North East and not so much in Greater London

Help-to-buy-map-2-21.png

..the path of prices in the North East is down and in London it has been going bonkers

it+is+not+help+to+buy.png

I'll accept that Help to Buy will have had some effect on sentiment in the Greater London in the South East, but prices were rising before the introduction of HTB1 and HTB2 last year.

Also the scale of HTB2 is just puny.

  • In the first 6 months of the Help to Buy: mortgage guarantee 7,313 mortgages were completed with the support of the scheme.
  • Of these, 80% were purchases by first time buyers.
  • The total value of mortgages supported by the scheme is £1 billion.
  • Compared to total mortgage completions in each region, the scheme is supporting a higher proportion of mortgages in the North West and the East, and a lower proportion in London and the South East.
  • The mean value of a property purchased or remortgaged through the scheme is £151, 597, compared to a national average house price of £252,000.

Source: HM Treasury - Help to Buy: mortgage guarantee scheme Quarterly Statistics

What is pushing the aggregate statistics is London, and what is pushing London is the fact that world is awash with cheap money and London is rising - so people pile in and it keeps rising. Stupid though HTB is, it is not making the weather in the national averages.

Edited by bland unsight

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If it was Help to Buy that was the main explanatory factor, then how do you explain that although there has been plenty of Help to Buy in the North East and not so much in Greater London

Help-to-buy-map-2-21.png

..the path of prices in the North East is down and in London it has been going bonkers

it+is+not+help+to+buy.png

I'll accept that Help to Buy will have had some effect on sentiment in the Greater London in the South East, but prices were rising before the introduction of HTB1 and HTB2 last year.

Also the scale of HTB2 is just puny.

Source: HM Treasury - Help to Buy: mortgage guarantee scheme Quarterly Statistics

What is pushing the aggregate statistics is London, and what is pushing London is the fact that world is awash with cheap money and London is rising - so people pile in and it keeps rising. Stupid though HTB is, it is not making the weather in the national averages.

Fair points....that is hard to explain.

Maybe it was done off the back of the expectation of HTB pushing up prices...or maybe people just moved out of london.

The whole thing makes no sense.

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If it was Help to Buy that was the main explanatory factor, then how do you explain that although there has been plenty of Help to Buy in the North East and not so much in Greater London

Help to Buy is designed to push prices up in the regions. The Tories have decided to go all in on house prices rising around the country to win them more votes. At the Tory conference when Osborne brought it forward, he said people in London don't think we should do it but he didn't want anyone to miss out on the "recovery".

But too many people are still being denied the dream of owning their own home. So instead of starting the second phase of Help to Buy next year, we’re starting it next week.
There are some people - many living in the richest parts of London - who say we shouldn’t be doing these things. I have this to say:
Take you arguments down the road to Nelson or Colne, where house prices have fallen for the past five years. Take your arguments to Bury, or Morecambe, where young working couples are still living at home with their parents.
Take your arguments to our great towns and cities where there are families who have saved for years, earning decent salaries, who can afford the mortgage repayments but can't possibly afford the deposit being asked by the banks these days.
Take your arguments to those families and say: “This policy is not right. You shouldn't be allowed to get your home.”
I tell you what they'll say back: “It's alright for you. You've got your own home. We’ve been saving for years. What about us?”
I know whose side this Party is on. We are the party of aspiration. The housebuilding party of Macmillan.
The party of Thatcher's right to buy. And now the party of David Cameron’s Help to Buy. We are the party of home ownership and we’re going to let the country know it.
We are also going make sure no one is left behind as our economy recovers. Our goal is nothing short of a recovery for all.

London was bubbling due to foreign money and I suspect more people there are making money from the FTSE rising, than in places like the North East.

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Help to Buy is designed to push prices up in the regions. The Tories have decided to go all in on house prices rising around the country to win them more votes. At the Tory conference when Osborne brought it forward, he said people in London don't think we should do it but he didn't want anyone to miss out on the "recovery".

If you look at northants then the bottom end of the market is collapsing. It's the upper middle to top end that say mad sale price this year. It's clearly been propped up by london sellers moving out and desperate people moving before they missed out.

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This is couple of months old but makes it look like FLS is the smoking gun as the rises predate htb1 by months. Htb is just tacit approval that house prices should be high so jump on in, its government approved.

Ben Chu (@BenChu_) tweeted at 11:44 am on Tue, Apr 22, 2014:

House prices seem to have responded strongly to the fall in mortgage rates: http://t.co/CR8sAqDc9V

(https://twitter.com/BenChu_/status/458557053384916993)

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Or perhaps our free market government will just dream up another prop :(

How about a mandatory insurance that they can also tax us for - say 'Rent premium tax' which can be used to insure your BTL rentier landlord against defaulting when interest rates rise, thus 'protecting hard-working-families unable to get their feet on to the housing ladder'...

FGS don't give them ideas!

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Help to Buy is designed to push prices up in the regions. The Tories have decided to go all in on house prices rising around the country to win them more votes. At the Tory conference when Osborne brought it forward, he said people in London don't think we should do it but he didn't want anyone to miss out on the "recovery".

London was bubbling due to foreign money and I suspect more people there are making money from the FTSE rising, than in places like the North East.

What I thought at the time, and I haven't seen anything to change my mind since, is that Help to Buy 1 (equity loans) was a way to stop new housing completions collapsing to zero at a time when there was a stand off between the volume box builders (who wanted to sell new houses as prices that locked in profits - putting them at a high price point because of what they'd paid for the land) and the banks (who wanted big deposits from borrowers if the borrowers were going to borrow at hefty LTI ratios in order to pay bubbly prices). Essentially, HTB1 was a bung to the builders. I agree that it was a win for Osborne and Cameron that by setting up FTBers to pay peaky prices HTB1 would support the bottom of the market in the regions. Whilst it might be best for the economy if prices fell, Osborne and Cameron appear to take it as a political article of faith that falling prices will not enhance their chances of re-election.

On HTB2 (mortgage guarantees) I still think that it was a cheap way to pump sentiment a little.

This is couple of months old but makes it look like FLS is the smoking gun as the rises predate htb1 by months. Htb is just tacit approval that house prices should be high so jump on in, its government approved.

Ben Chu (@BenChu_) tweeted at 11:44 am on Tue, Apr 22, 2014:

House prices seem to have responded strongly to the fall in mortgage rates: http://t.co/CR8sAqDc9V

(https://twitter.com/BenChu_/status/458557053384916993)

Agree 100% with the suggestion that prices rose because mortgage rates fell. The swap rates were falling of a cliff from January 2011 (presumably Fed QE2 and BoE doing another £75bn QE in October 2011 and another £50bn in February 2012). Funding for Lending must have amplified the effect of these falls in the swap rate on mortgage rates by all but removing the premium crap banks had to pay when borrowing because they didn't have a printing press and were in fact a crap bank.

Now the 5-year swap rate is fully 100bps higher than it was a year ago and FLS is being wound up for non-BTL mortgages, so what happens next to mortgage rates?

I think that it is worth remembering that as rates rose into the end of the previous boom (2002-2008) credit underwriting standards essentially ceased to exist and IMO it was the removal of credit underwriting standards that did the heavy lifting in the final stages of the previous bubble, but again, at the risk of being a desperate bore, credit underwriting standards are way, way tougher than they were in 2008. You can't pay 2008 prices with 2014 credit underwriting standards unless you have access to the comedy rates (e.g. 2%) - but those rates are about to disappear and it is perfectly possible that we may not see them again in our lifetimes. And anyway, the only way to get access to those rates for most households is to have bubble equity, and again, outside of postcodes affected by the London bubble, they just are not making bubble equity in a way that can hold a candle to the 1997-2008 phase. It's over - it's been over for a long time.

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I see they did an analysis of stamp duty land tax. I wonder what they want ? :)

I noticed that. Had they ever done that before? I assumed that they were dropping a not so subtle hint that a decent housing boom is a great way to raise tax, (as if Osborne needs reminding!)

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