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Rate cut anyone?

Why are you so interested in inflation data?

Sounds like desperation to me. Interest rate cuts are the only way property can 'enjoy' any more capital growth and then only in the short term. Based on comments made by Mervyn King, I can't see any interest rate cuts in the pipeline.

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Rate cut anyone?

Mervyn at the BoE just issued a warning that rates may well go up:

http://uk.us.biz.yahoo.com/ft/060116/fto01...63573.html?.v=1

"Mervyn King, Bank of England governor, has warned of the threat of a rise in long-term interest rates and a fall in the price of assets such as shares and housing."

Edited by Realistbear

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Guest Charlie The Tramp

I think we all know we can expect low rates for quite a while to come. The demographic situation also points to low long term rates as well.

Get in while you can bears, beat the rush, you know what I mean.......

TTRTR, beware the gathering storm. ;)

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I think we all know we can expect low rates for quite a while to come. The demographic situation also points to low long term rates as well.

Get in while you can bears, beat the rush, you know what I mean.......

Not necessarily. The Fed may not be as near to the end of the tightening cycle as some think.

There are growing calls for the economic imbalances to be sorted out in the US.

We will have little choice but to go along with it, as we did when lowering rates 3 or 4 years ago.

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I think we all know we can expect low rates for quite a while to come. The demographic situation also points to low long term rates as well.

Get in while you can bears, beat the rush, you know what I mean.......

Most of the downward pressure on inflation was from lower petrol prices and air fares, both related to oil prices - and with conflict in the Middle East - we know where they're going.

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Guest Riser

Rate cut anyone?

I think they may actually cut rates next month as the resulting devaluation of sterling will to some extent be masked by a falling dollar. I am also expecting a small rise in asking prices this Spring due to last Augusts rate cut. However, very few vendors will be able to realise the high prices as buyers have already hit the limits of affordability.

By late summer we should be through this blip in HPI and the crash will be back on track making up for lost ground by the end of the year. Falling prices will then have sufficient momentum to turn public sentiment when combined with a devaluing pound, falling stock market, and increasing numbers of desperate sellers with houses on the market for over a year who are looking to down size as they are unable to pay their high mortgages.

With a combination of low or negative HPI and low renal yields the BTL investors will start to see houses as more of a liability than an asset especially when they see commodities such as Gold, Silver continue their bull run. Greed attracted BTL into housing in the first place and it will be greed for the higher returns offered by other investments that will cause them to run for the exits later this year. BTL will also be under pressure from their lenders who will be trying to reduce their own exposure to risk by removing the generous interest rate deals offered to BTL in the past and forcing BTL to sell parts of their portflio to reduce loan to value for the remaining properties.

The crash this time could be harder and faster than last time as BTL are able to sell without chains, and will be prepared to slash prices due to the leveraged profits they have made, they will also not need the capital to buy property further up the chain where prices will fall a slower rate than FTB and investment types of property.

Most of my STR funds are now out of sterling so if they reduce rates I will gain from a devaluing pound, if they increase rates, the current levels of debt which have made the housing market hyper sensitive to rate changes will force a market collapse harder and faster than anything we have seen in the past.

We all know that the CPI inflation figures are rigged, thats why Mervyn said he would also be watching asset prices for signs of inflation. Once higher fuel costs eventually permiate through to higher wage demands we will see the BOE forced to put up rated whch will further fuel the house price crash.

Edited by Riser

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This is mainly about fuel costs. Nov and Dec had the lowest average prices for crude for several months, hence the lower inflation figure. We have seen this in Euroland too. Since then, the oil price has spiked back up, thanks mainly to a nutter in Iran who wants to build a nuclear bomb. And that's a problem that's not going to go away soon.

I expect higher average crude prices this year than last and hence higher inflation coming through.

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Most of my STR funds are now out of sterling so if they reduce rates I will gain from a devaluing sterling, if they increase rates, the current levels of debt which have made the housing market hyper sensitive to rate changes will force a market collapse harder and faster than anything we have seen in the past.

Interesting Riser.

Where have you got your STR if you don't mind me asking?

Also, what are your thoughts on if the Bank holds rates as they are for the rest of the year?

http://www.bloomberg.com/apps/news?pid=100...sQmb2k&refer=uk

U.K. inflation was the slowest in six months in December as prices of fuel dropped, increasing the likelihood the Bank of England will keep interest rates unchanged as economic growth picks up.
Edited by BubbleTurbo

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I don't think lower rates will actually feed into lower mortgage rates anyway.

With increasing arrears and bad debt on their loan books most banks/BSs are looking for ways to improve their margins... I suspect that any rate cut won't be passed on to punters anyway unless they have a rate that is fixed above base IRs.

Me, I don't mind if the low IRs continue..... it won't stop the fall in house prices anyway so who cares :lol::(:P

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TTRTR,

Have you ever wondered why, over the last hundred years, we have witnessed repeated boom and bust in assets such as gold, stocks, and property?

Do you think its just 'one of those things', random events?

Why are so called expert investors consistently unable to call the market, getting burnt time after time?

Do you really know who has the ultimate say in how much peasants like you and I can borrow to 'buy' our over valued homes, and why this amount, and ease with which it can be obtained has so dramatically changed in the last few years?

Why the majority of western populations have swallowed this debt doctrine without question?

Do you, have you, ever questioned any of this?

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Guest Riser

Interesting Riser.

Where have you got your STR if you don't mind me asking?

Also, what are your thoughts on if the Bank holds rates as they are for the rest of the year?

http://www.bloomberg.com/apps/news?pid=100...sQmb2k&refer=uk

A decent proportion of it is in a combination of allocated and unallocated commodity accounts and mining stocks.

Edited by Riser

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BBC website said figures were helped by Fuel and air travel.

Air travel figures are all over the place so can be ignored. They just muddy that water.

Fuel inflation has gone up from 24.3% in November to 39% In December.

Sure it has fallen from its October peak, but it is contributing more to the figures now than it did last month..........

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I think the importance of fuel and the oil price, on inflation, will become even more evident, as growth in demand continues to outstrip growth in supply.

This will become especially hard to swallow in the UK, as the North Sea winds up.

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Who are you then??

Michael Fish??

:lol:

I read the thread title as Inflation 2.0, a new improved inflationary measure (i.e. its an inflation measure where we've taken all the inflationary factors out , no oil, no fuel or food costs but we reflect all the costs of goods from china this year).

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Producer prices up over 17% and CPI up 2% apparently.

You don't have to think long and hard about the consequences for business or indeed the consequences for the general public who will be getting pay awards based primariliy on the CPI whilst still bingeing on credit.

The BOE will be targeting dreams whilst the inflationary bulldozer is round the back demolishing the house, brick by brick.

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Guest Charlie The Tramp

You know those weather forecasters, they always tend to exagerate things.....

Well, here`s my predicton using my observation of our economic history the past forty years.

This year they will fire a few explosive rockets into the clouds to force a little sunshine, giving the populace a false feeling of the feel better factor.

Then between 7am and 9am on a Monday early next year the first wave will hit the foreshore catching everyone by surprise. A sudden change in economic climatic conditions could forward the storm to October this year. ;)

My fellow forecaster more or less agrees. :rolleyes:

FURTHER rises in oil prices, the collapse of a major bank or an unexpected jump in inflation could be all it takes to send the increasingly fragile global financial system into meltdown.

The Reserve Bank of Australia has warned that the current calm in financial markets could be the prelude to a storm that could wreak havoc in the world economy.

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  • 301 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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