Jump to content
House Price Crash Forum

Recommended Posts

BF, those were the Q2 figures. They are entirely in line with expectations. This is not news, nor is it bad for the bears.

Yes, I know it is Q2, that is why I put Q2 in the title. The late returns are the last 18 to 20% of the transactions registered for that quarter. We have the Q3 out in a few days. This will show the first 80% of transactions registered.

It is bad for the bears because it shows the late returns in all the regions bar London pushing the average value up, and transactions in the capital are the 5th highest. Hardly a slowing market.

The LR lags, but it cannot be by that much or there would be more late returns being registered in the following two quarters from the first cut. I think the solicitors have to get the data into the land reg within 30 days of completion, and the ave time from sale-agreed to completion is 60 days, I think I read somewhere.

Are you suggesting that the Q3 data will show a large change?

Link to post
Share on other sites
Post on TMF tells us all what we did not want to hear!

http://boards.fool.co.uk/Message.asp?mid=8...2&sort=postdate

Sorry guys  :(  :(  :(

BF thanks for the link. I'm not sure why you seem surprised though. The spring rush was well documented in the press and here. That's all it reflects. Market stopped in June and hasn't picked up as it usually does in Sep/Oct. Q3 will point the way.

Link to post
Share on other sites
BF thanks for the link. I'm not sure why you seem surprised though. The spring rush was well documented in the press and here. That's all it reflects. Market stopped in June and hasn't picked up as it usually does in Sep/Oct. Q3 will point the way.

I'm not entirely convinced that Q3 LR figures will show anything other than a further reduction in transaction volumes (in London at least). It may even show rising prices still !!!

Am I right in thinking that LR shows completions at agreed sales price ?

If so, then by way of example, I sold my BTL flat earlier this year. The offer was made in mid May, at the peak, but we didn't complete until late August, which means this particular sale will show up in LR Q3 figures, being a sale at peak market price. By the time I completed, many other sales were falling through, including the sale of my own PPR. But the ones which were going through were probably completing at peak value.

This is why IMHO we may see falling volumes from the Q3 LR data, but not necessarily falling prices.

Link to post
Share on other sites
Guest wrongmove
Are you suggesting that the Q3 data will show a large change?

According to yet another indicatir, the FT index, the Q3 figures will not record a large change. The FT index is specifically designed to predict the LR figures, and it seems to do this quite well, based on past results:

FT HP index (subscription only, I think)

House Price, Index, Monthly Change %, Annual Change %

Sept 2004 £185,814 178.2 1.5. 16.8

August 2004 £182,993 175.5 1.4 17.3

July 2004 £180,430 173.0 1.5 18.0

May 2004 £175,395 170.5 1.4 18.0

April 2004 £173,607 168.1 1.0 17.5

March 2004 £172,095 166.5 0.9 16.7

Source Annual Month Oct-03 Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04

Land Registry A 12.5 14.1 17.3

Q 1.6 1.6 5.4

FT A 11.8 12.6 13.0 13.0 14.1 15.5 16.7 17.5 17.8 17.4 15.9 16.8

M 2.2 1.8 1.1 0.9 1.0 1.1 0.9 1.0 1.2 1.1 0.8 1.5

The above has not copied well, but it indicates that thr FT index predicts that the LR figures will show annual HPI at around 17%, and quarterly HPI at around 3.5%

Link to post
Share on other sites
According to yet another indicatir, the FT index, the Q3 figures will not record a large change. The FT index is specifically designed to predict the LR figures, and it seems to do this quite well, based on past results:

FT HP index (subscription only, I think)

    House Price,  Index, Monthly Change %, Annual Change %

Sept 2004  £185,814  178.2  1.5. 16.8

August 2004  £182,993  175.5  1.4 17.3

July 2004  £180,430  173.0  1.5 18.0

May 2004  £175,395  170.5  1.4  18.0

April 2004  £173,607  168.1  1.0 17.5

March 2004  £172,095  166.5  0.9 16.7

Source  Annual Month Oct-03  Nov-03 Dec-03 Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04

Land Registry  A  12.5 14.1  17.3

  Q  1.6 1.6 5.4

FT  A  11.8  12.6 13.0 13.0 14.1 15.5 16.7 17.5  17.8 17.4 15.9 16.8

  M  2.2 1.8 1.1 0.9 1.0 1.1 0.9 1.0 1.2 1.1 0.8 1.5

The above has not copied well, but it indicates that thr FT index predicts that the LR figures will show annual HPI at around 17%, and quarterly HPI at around 3.5%

They delay from Agreed Sale to Land Reg on average at least three months and probably more like four.

If we assume 10 weeks from offer accepted to completion (which is on the short side for a residential transaction in a chain). The solicitor will probably get the application off to the Land registry 2-3 weeks after completion (but could be longer as they have 6 weeks (30 working days) to do it and filling in the forms is a boring job and "non-urgent" so gets put off). The land registry then usually takes (depending on the part of the country) something like 2 to 3 weeks to complete the registration when they are being quick but it can easily take 5 or 6 weeks and I have known it take 3 months (particularly if there is a complication or requisitions are raised or the solicitor forgot to enclose a relevant bit of paper - it happens at lot!!).

So the late Q2 figures could easily relate to sales agreed in February/March of last year.

Assuming Surveyor is correct and the breaks really went on in June (which fits with my experience as well) then it will be Q4 before we see this feed through into the LR figures.

Link to post
Share on other sites
Guest wrongmove
Assuming Surveyor is correct and the breaks really went on in June (which fits with my experience as well) then it will be Q4 before we see this feed through into the LR figures.

I agree - the LR figures are the most reliable, but they can only be used to put hard numbers on what we already know. If we assume that dropping prices next Spring would confirm that a crash/correction is definitely taking place, it may not be apparent in the LR figures until Q4 2005 !

Link to post
Share on other sites

Can't read too much into LR stats. I expect and hope to see a fall off in transactions (at least for London) in the Q3 figures, but price may well be higher such is the lag.

I would suggest that if LR stats usually trail the market by 3 months, it is currently more like 4-5, maybe even 6 months - the "number of weeks taken to 'sell'" has risen in the last few months according to Rightmove, and then you have to take into account the length of chains is abnormally high, which will drag conveyancing out even longer.

Link to post
Share on other sites
Guest Property Master

take it from me guys... the market has already lost at least 5% and upto 10% in places.... see... told you i am bear like you...(only difference is i'm still buying no matter whats happening to prices!)...brakes definitely on in june....

i use land reg figures everyday.... however potentially it can 8 months 29 day behind today!!! sooooo use caution when looking at these..

PM

Link to post
Share on other sites

"i use land reg figures everyday.... however potentially it can 8 months 29 day behind today!!!"

This is so important it is worth repeating: the LR figues can be up to 9 months out of date, and often are. They won't tell you where the market is going or even where it was in the recent past.

Link to post
Share on other sites

The LR figures are ultimately the most useful because they do capture every transaction: all the other indices have flaws due to small/skewed sample sizes, ignoring cash sales (25% of total) etc.

The FT House price index mentioned by Cityfool is actually produced by a company Acadametrics. They have done a multi-variate regression on all the leading HP indices to try and predict the LR data.

Some interesting information is freely available on their website

http://www.acadametrics.co.uk

Here is a table comparing all recent index data: Useful Table

Here is an interesting paper they gave at the Housing Statistics User Group meeting on 14th May 2004 http://www.acadametrics.co.uk/PaperHSUG.pdf

Link to post
Share on other sites

I agree that the LR figures will probably show an increase in price. This will be trumpeted by the papers saying "House Prices Rebound". This might either act to further reignite the market or at least convince more people that a soft landing it possible.

That is actually quite good if you are an uber-bear and are expecting large falls. On another thread, it was discussed whether, with everyone talking negatively, the market is being talked down gradually and that a real crash will only happen when there are no bears in the market.

Link to post
Share on other sites
take it from me guys... the market has already lost at least 5% and upto 10% in places.... see... told you i am  bear like you...(only difference is i'm still buying no matter whats happening to prices!)...brakes definitely on in june....

i use land reg figures everyday.... however potentially it can 8 months 29 day behind today!!! sooooo use caution when looking at these..

PM

Property is the same as any other asset class, you can make money whether the general price trend is up, down or sideways, if you know what you're doing. Presumably speed of completing deals becomes paramount though when general HP trend is down- from the little I've heard about your business it's based on quick turnaround deals? If so, it stands decent chance of continuing to flourish, unlike the unthinking "I'm in it for the long term" bull who holds onto their falling/loss-making asset come what may.

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
  • Recently Browsing   0 members

    No registered users viewing this page.

  • 439 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.