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Death Of The Uk Housing Market Greatly Exaggerated.

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

Reports of the death of the UK housing market have been greatly exaggerated. The Halifax house price index rose sharply in November and is running at a three-month average of 4.5 per cent, nearly double July’s low. Rising mortgage approvals suggest prices will increase further. The Council of Mortgage Lenders has raised its 2005 estimate of new mortgages to £280bn, a mere 4 per cent below last year’s record.

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

Reports of the death of the UK housing market have been greatly exaggerated. The Halifax house price index rose sharply in November and is running at a three-month average of 4.5 per cent, nearly double July’s low. Rising mortgage approvals suggest prices will increase further. The Council of Mortgage Lenders has raised its 2005 estimate of new mortgages to £280bn, a mere 4 per cent below last year’s record.

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

Well I think low transaction volumes are needed, so this does seem like bad news for us bears. Im lucky. My rent is cheap and i dont mind waiting. It just looks like another twist in the story line, but at the end of the day we all know what the ending is going to be.

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

Reports of the death of the UK housing market have been greatly exaggerated. The Halifax house price index rose sharply in November and is running at a three-month average of 4.5 per cent, nearly double July’s low. Rising mortgage approvals suggest prices will increase further. The Council of Mortgage Lenders has raised its 2005 estimate of new mortgages to £280bn, a mere 4 per cent below last year’s record.

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

I'll cheer the bears up and post the rest of the article;

Alliance & Leicester, which investors on Friday, has clearly benefited from this renewed buoyancy. Mortgage defaults did not increase, although there was a small deterioration in unsecured credit quality. This is a salutary reminder of the dark side to the recent improvement in housing market indicators. UK households are still painfully indebted, and signs of strain in the unsecured lending market are growing. In the first half of the year, Barclays, which owns the UK’s largest credit card operator, cut the credit limits of 83,000 Barclaycard customers and increased bad debt provisions by 20 per cent. Since people typically default first on their unsecured loans, this strain could well pass through into mortgages next year.

The current lull could thus prove to be the eye of the storm before a new downturn. The Organisation for Economic Co-operation and Development recently calculated that the UK housing market was overvalued by 33 per cent, outstripped only by Australia. The end may yet be nigh.

Happy now?

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

Reports of the death of the UK housing market have been greatly exaggerated. The Halifax house price index rose sharply in November and is running at a three-month average of 4.5 per cent, nearly double July’s low. Rising mortgage approvals suggest prices will increase further. The Council of Mortgage Lenders has raised its 2005 estimate of new mortgages to £280bn, a mere 4 per cent below last year’s record.

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

HPC IS delayed according to Halifax. According to Nationwide the HPC is still on--their figures for the same period were the direct opposite! Propaganda Wars I am afraid. Nationwide are building enormous goodwill through greater honesty in the stats.

Earlier this week, the country's biggest building society, the Nationwide, said UK house prices were unchanged in November.

http://news.bbc.co.uk/1/hi/business/4489804.stm

http://business.guardian.co.uk/story/0,16781,1656739,00.html

In fact, says Alan Castle, an economist at Lehman Brothers, the Halifax figures are showing that house prices have risen 4.7% over the past six months while the Nationwide shows a 1% rise and Hometrack a fall of 0.7%. House price indicators differ because they have different sample bases and often only relatively small numbers of properties change hands each month, meaning different indices can tell quite different stories.

Edited by Realistbear

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

But you haven't shown the chart they have alongside on HPs to disposable incomes:

1973 massive peak at 129%

1989 massive peak at 135%

2005 massive peak at 146%

:lol::lol::lol::lol::lol:

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It is all spin. I know someone who has access to the real figures for two major banks.

Number of house sales completions is down dramatically since last year.

Prices are stable but starting to waver.

Anecdotal evidence suggests people are having to lower the asking price. The only two people I know who have sold in the last few months have had to lower the price considerably.

I just do not see huge rises in the housing market next year. Too many factors weigh against a rise in my opinion. The economy needs to enter a corrective phase. I am not gleeful about this though as just as the house prices come down I'll probably lose my job and have to spend all my savings on rent whilst those who took out huge debts will get benefits.

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have to spend all my savings on rent whilst those who took out huge debts will get benefits.

On the contrary; if you rent and you lose your job, you can apply for housing benefit. The same would not apply to someone who had taken out an IO mortgage on a property.

http://www.dwp.gov.uk/lifeevent/benefits/lha.asp

Local Housing Allowance does not cover all housing costs. For example, mortgage interest if you are buying your home. If you get Income Support or income-based Jobseeker's Allowance you may be able to get help with these other housing costs as part of your benefit.

http://www.jobcentreplus.gov.uk/JCP/Custom...port/index.html

Income Support

If you have to attend your Jobcentre regularly, you cannot get Income Support.

If you lose your job you will be on Jobseeker's Allowance, which requires you to attend a Jobcentre regularly. So an owner-occupier will not receive income support either.

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All these figures are fudged to paint a rosier than rose picture of the "housing market". In economics 101 you learn about pricing equilibriums and PED. Goods as in houses just can't keep rising, its not possible. Once you reach an eq point above say income averages you lose customers, if it continued you have none.

All these fudged figures are fudged because they need money. If I am selling cars for example, would I tell people "Times are bad, no one is buying any cars, save your money" or "Cars are selling fast, buy now, in order to not be disappointed".

Which sounds better for business?

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Guest Charlie The Tramp

Anecdotal evidence suggests people are having to lower the asking price. The only two people I know who have sold in the last few months have had to lower the price considerably.

Same here, two properties sold with a total of 75k in reductions. Similiar properties in these areas still sticking after 12 months on the market.

Many of these I would imagine will not be in chains, but some downsizers unable to reduce their prices due to MEWing.

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On the contrary; if you rent and you lose your job, you can apply for housing benefit. The same would not apply to someone who had taken out an IO mortgage on a property.

I think it used to be that if you had a lot of savings then you would not qualify for income support until you had spent most of it. I wasn't so sure about housing benefit but the page says

Savings over £16,000 usually mean you will not be able to get Local Housing Allowance.

Savings over £3,000 (£6,000 if you or your partner are aged 60 or over) will usually affect how much Local Housing Allowance you can get.

So those of us saving for deposits could see them squandered if we are made unemployed.

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But they are only interested in cash, so why not buy a mix of gold, shares, wine or some other store of wealth. If you have kids, they can have 3k each. Why not give it your mum to look after.

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It is all spin. I know someone who has access to the real figures for two major banks.

Number of house sales completions is down dramatically since last year.

Prices are stable but starting to waver.

Anecdotal evidence suggests people are having to lower the asking price. The only two people I know who have sold in the last few months have had to lower the price considerably.

I just do not see huge rises in the housing market next year. Too many factors weigh against a rise in my opinion. The economy needs to enter a corrective phase. I am not gleeful about this though as just as the house prices come down I'll probably lose my job and have to spend all my savings on rent whilst those who took out huge debts will get benefits.

I posted this reply somewhere yesterday - but can't find it - so apologies for repeating it.

House price asking price reduction is NOT the same thing as the house prices achieved falling.

The example I gave is this:

Person wants to sell, asks EA for asking price valuation.

EA looks up last price achieved, adds on 20% Asking price (AP) = 120% last price achieved (LPA)

House doesn't sell after a year. Vendor reduces AP by 10% so new AP = 108% LPA

Vendor accepts an offer 5% below AP so new price achieved = 102.6% LPA

This is an increase of 2.6% on last price achieved.

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I posted this reply somewhere yesterday - but can't find it - so apologies for repeating it.

House price asking price reduction is NOT the same thing as the house prices achieved falling.

The example I gave is this:

Person wants to sell, asks EA for asking price valuation.

EA looks up last price achieved, adds on 20% Asking price (AP) = 120% last price achieved (LPA)

House doesn't sell after a year. Vendor reduces AP by 10% so new AP = 108% LPA

Vendor accepts an offer 5% below AP so new price achieved = 102.6% LPA

This is an increase of 2.6% on last price achieved.

The EA looked at the last price achieved and used to add on 20% because this was in line with inflation. When the prices are looked at now he would be lucky to add on around 5%. If this was on your house which previously acheived 102.6% then the highest priced asked is lower than it used to be. In the buyers market the house is then reduced 10% as you have stated previously, the buyer offers 5% less, vendor accepts and the price achieved results in the house costing less than it used to.

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Lex: UK housing market

Published: December 2 2005 14:07 | Last updated: December 2 2005 14:07

Reports of the death of the UK housing market have been greatly exaggerated. The Halifax house price index rose sharply in November and is running at a three-month average of 4.5 per cent, nearly double July’s low. Rising mortgage approvals suggest prices will increase further. The Council of Mortgage Lenders has raised its 2005 estimate of new mortgages to £280bn, a mere 4 per cent below last year’s record.

http://news.ft.com/cms/s/b565f18a-6329-11d...00779e2340.html

HPC delayed again?

Just a thought, but I wonder what percentage of the mortgage approvals are properties purchased for BTL/BTS from stressed sellers selling BMV?

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  • 333 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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