Halifax: Oct Prices -1.1% m-on-m (Sep +1.4)

[Sledgehead]

This news out today (Thursday 04/11/2004) @ 08:00 am

Trying for a link......

[BufferBear Bitcoin Bull]

Sledge,

I looked for the figures 30 mins ago but don't think they have been released yet. I used the link on the home page (HPC) but October's report is still showing.

Do you think they are going to release them in time to try and influence the MPC's decsion due at noon??

[BufferBear Bitcoin Bull]

I think this is the link to the required section. Hopefully, the relevant national press release will be added before I leave for work, where I have no internet access!!

http://www.hbosplc.com/economy/housingresearch.asp

[Sledgehead]

This is a nightmare. Every month Halifax leaks this stuff to Dow Jones Newswires (I have a realtime broadcast feed) but Halifax don't put the report up on their site. I'll keep looking. I hate posting lwithout references. I expect it will appear on Bloomberg / Reuters .

I separate this machine from my rt feed machines but here's the DJNewswires snippet, typed in by hand for your appreciation.

"House prices in the UK fell on the month in October, while the yearly growth rate was below 20% for the first tiime in six months, lender Halifax said today.

According to the Halifax house price index, released by HBOS, house prices fell by 1.1% on the month and rose by 18.5% from October 2003.

This is weaker than the 0.5% monthly and 19.4% annual increases forcast by analysts surveyed by Dow Jones Newswires

In September prices were 1.4% higher on the month and 20.5% higher on the year"

-end-

[Guest wrongmove]

Nice one SH - did they say if the -1.1% was seasonally adjusted ? The Halifax Index usually is.

[Anthony]

A quick search on news.google.com under "house prices" revealed this:

http://news.scotsman.com/latest.cfm?id=3714581

********************************

House Prices Fall as Property Market Weakens

By Rachael Crofts, PA News

House prices fell by 1.1% last month as the property market continues to weaken, according to figures published today.

Over the past year prices have increased by 18.5%, with the annual rate of growth now below 20% for the first time in six months, according to the Halifax monthly house price index report.

On a quarterly basis, prices fell for the first time since the last quarter of 2000, down 0.4% between July and October.

[Sledgehead]

Amazing, I was searching for the terms halifax and "house prices". Diddly squat. All of a sudden we get:

your scotsman article (supposedly 8:19am) and now this:

CBS Marketwatch

3:09am 11/04/04

U.K. house prices fell 1.1% in Oct - lender Halifax By Emily Church

LONDON (CBS.MW) -- British house prices dropped 1.1 percent in October on the month, mortgage lender Halifax said. Prices are up 18.5 percent on the year. The month-over-month decline will bolster the view that rising interest rates in the U.K. are tempering demand for housing. The Bank of England meets later today on rate policy; no change is expected. "Housing market fundamentals remain sound. Interest rates, while they have risen, seem likely to peak near current levels," the lender said. "Other indicators of the housing market have lost some momentum since mid-year but the general trend is a move from above average levels of activity back to the long-term trend." The average price for a house in the U.K. is 160,857 pounds ($297,000).

- ie supposedly released @ 8:09 am

Presumably it's down to the Google indexing lag

A quick search on news.google.com under "house prices" revealed this:

-- wish I'd have thought of that !

(sorry, must be a bit shirtier than normal today)

[Bullish Bear]

House prices down in October

http://www.reuters.co.uk/newsPackageArticl...section=finance

LONDON (Reuters) - House prices fell 1.1 percent in October, the Halifax bank says.

Prices in the three months to October fell 0.4 percent on the previous three months, the first quarterly decline since the fourth quarter of 2000, but were still up 18.5 percent on a year earlier, Halifax said on Thursday.

Last month, the Halifax reported house prices rose 1.4 percent in September and by 20.5 percent in the three months to September on a year earlier.

"The housing market seems to be moving into a slowdown following the period of strong growth in 2003 and early 2004," said Martin Ellis, chief economist at Halifax.

[Gtr London FTB]

You know the crash is upon us when evem Halifax are reporting a fall! Is this seasonally adjusted or not?

[Guest Charlie The Tramp]

Do you think they are going to release them in time to try and influence the MPC's decsion due at noon?? 

You can be assured the MPC would have advanced copies of all relevant economic data before it is released into the public domain.

[Bullish Bear]

http://www.uk-wire.com/cgi-bin/articles/20...800038434E.html

Key Points

• House prices fell by 1.1% in October. Over the past year, house prices

have increased by 18.5% with the annual rate of growth now below 20% for the

first time in six months.

• On a quarterly basis, houses prices fell by 0.4% between July and October.

This is the first fall on a three monthly basis since the last quarter 2000.

• There are tentative signs that the ratio of house prices to earnings may

have peaked at 5.63 in July with a slight decrease to 5.57 in August (the

latest available figure). The recent series of interest rate increases have

raised mortgage payments as a percentage of earnings from 14% to 19% for new

borrowers over the past year. This remains well below the peak of 34% in

1990, however.

• Other indicators of the housing market confirm a softening in housing

market activity. Data from the Bank of England and the Council of Mortgage

Lenders points to a moderation in home lending, while surveys of estate

agents point to some decrease in buyer interest. Figures from Halifax Estate

Agents show a fall in the number of sales agreed over the past few months.

• Housing market fundamentals remain sound. Interest rates, while they have

risen, seem likely to peak near current levels. Employment and household

incomes, two very important drivers of the housing market, continue to grow.

Additionally, supply constraints, especially in the south of England, will

also underpin the market.

Commenting, Martin Ellis, Chief Economist, said:

'The housing market seems to be moving into a slowdown following the period of

strong growth in 2003 and early 2004. The rises and falls we have seen in prices

in recent months are part of the ebb and flow of the market as it finds a new

base. October's 1.1% fall follows a 1.3% rise in September.

Recent price movements confirm that the Bank of England's rate hikes have taken

impetus away from housing demand while first-time buyers continue to be held

back by affordability constraints.

We expect house price growth to continue to moderate into 2005 as the Bank of

England's rate increases and first time buyer affordability constraints dampen

demand. Market fundamentals remain sound. Interest rates, while they have risen,

seem likely to peak close to current levels. Economic growth remains above its

long-term average rate and employment and incomes continue to rise. Supply

constraints, especially in the south of England, will also underpin the market.

The rapid rise in house prices over the past few years has resulted in a

substantial increase in the amount of housing equity held by homeowners. We

estimate that the value of housing assets exceeded the value of outstanding

mortgage balances by £2,200 billion at the end of 2003. This represented a more

than doubling in housing equity since 1998 and was well above the £900bn at the

end of 1989.

Buyers have been putting down bigger deposits than in previous cycles. 83% of

all borrowers took out a mortgage of less than 90% of the house price in the

third quarter of 2004, according to the latest figures from the CML, compared

with 56% in 1989 and 1990.'

Recent house price performance has parallels to 1999/2000.....

The moderation in house price growth in recent months has similarities to the

performance of the housing market during the previous Bank of England monetary

policy tightening cycle in 1999 and 2000. Between September 1999 and February

2000 base rates rose from 5.00% to 6.00%. House prices subsequently fell in four

out of the twelve months following the first rate rise, and the annual rate of

house price inflation slowed from a peak of 16% in January 2000 to 1% in January

2001.

Broader indicators of the housing market point to moderation.....

Other indicators of the housing market have lost some momentum since mid-year

but the general trend is a move from above average levels of activity back to

the long-term trend. The number of loans approved for house purchase fell by 20%

between the second and third quarters of 2004, according to the Bank of England.

Despite this fall, the number of loans in the third quarter was close to the

long-term average, at a monthly average of 94,000 during July to September

compared with the monthly average of 97,000 since 1987.

The latest RICS survey reported a fourth consecutive monthly rise in the stock

of unsold properties on estate agents' books in September resulting in a 9% rise

since May. However, the stock of unsold properties is still 6% lower than a year

ago and remains below the longer-term average. These trends are confirmed by

figures from Halifax Estate Agents, which also show a fall in the number of

sales agreed over the past few months.

First time buyer numbers remain subdued ....

Affordability remains a key factor hindering the outlook for first time buyers.

First-time buyers accounted for 28% of all new mortgages in the third quarter of

2004, according to the Council of Mortgage Lenders. Whilst there has been little

change in the proportion of first-time buyers in recent quarters, it remains

well below the longer-term average proportion of 44%.

Tentative signs that pressures on first-time buyers may ease ....

There are tentative signs that the ratio of house prices to earnings may have

peaked at 5.63 in July with a slight decrease to 5.57 in August (the latest

available figure). Further downward movement in this ratio would start to ease

the difficulties faced by first-time buyers.

Mortgage payments remain low as a proportion of earnings despite rate rises.....

The series of bank base rate rises since last November have had an impact on

housing affordability, raising mortgage payments as a percentage of earnings

from 14% to 19% for new borrowers. This is in line with the long-term average

and remains well below the peak of 34% in 1990.

UK economy remains strong .....

The UK economy remains in good shape with gross domestic product (GDP) in the

third quarter 3.0% higher than a year earlier: comfortably above the long-term

average growth rate of 2.5%.

Employment continues to rise and grew by 221,000 over the year to August with

the numbers in employment at a record high level. The claimant count

unemployment rate also continues to fall and is at a twenty- five year low of

2.7%.

Reflecting higher employment levels and also wages growth, household incomes

increased by an above average 5.5% over the year to June 2004, according to the

latest official estimates.

NOTE: The 18.5% number is the quarterly year-on-year figure. This figure

provides a much better picture of underlying trends compared to a monthly

year-on-year number as it smoothes out any short-term fluctuations.

The Halifax House Price Index is prepared from information that we believe is

collated with care, but we do not make any statement as to its accuracy or

completeness. We reserve the right to vary our methodology and to edit or

discontinue the indices at any time for regulatory or other reasons. Persons

seeking to place reliance on the indices for their own or third party commercial

purposes do so at their own risk.

[Polar]

http://www.uk-wire.com/cgi-bin/articles/20...800038434E.html

Whoops.... too slow.

[RRP]

House prices down in October

http://www.reuters.co.uk/newsPackageArticl...section=finance

LONDON (Reuters) - House prices fell 1.1 percent in October, the Halifax bank says.

"The housing market seems to be moving into a slowdown following the period of strong growth in 2003 and early 2004," said Martin Ellis, chief economist at Halifax.

<{POST_SNAPBACK}>

As long as the national press use the word 'down' again and again I will be happy with that for the moment - well it is Halifax figures. I had half expexted a 0.02%

drop. Anybody else happier ?

[sophtaylor]

I love this:

Looking forward, Halifax said there is evidence that homes may become more affordable for first-time buyers, as there are signs that the ratio of house prices to earnings may have peaked at 5.63 in July, with a slight decrease to 5.57 in August.

"Further downward movement in this ratio would start to ease the difficulties faced by first-time buyers," Ellis said.

-------------------

also, the numbers were released at 0800 GMT to all the wires, etc. They certainly are not leaked each month to Dow Jones - Halifax is just slow to update their own site I reckon.

[zzg113]

"The recent series of interest rate increases have

raised mortgage payments as a percentage of earnings from 14% to 19% for new

borrowers over the past year."

I would like to know how they have worked this one out. It is clearly ********.

[BufferBear Bitcoin Bull]

From the BBC.

Last Updated: Thursday, 4 November, 2004, 08:46 GMT

UK house prices 'fell in October'

House prices appear to be coming down

UK house prices fell by 1.1% in October, confirming a softening of the housing market, Halifax has said.

The UK's biggest mortgage lender said prices rose 18.5% over the past year, with the annual rate of house price inflation below 20% for the first time in six months.

The average price of a house in the UK now stands at £160,857, down from £162,911 in September, Halifax said.

It said five interest hikes in a year had "taken impetus away" from demand.

More soon.

[sophtaylor]

Bank of America's take on the numbers:

House Prices Turning South, Quickly

The Halifax index of house prices declined 1.1% mom in October, with the 3m/3m falling 0.4%, the first negative reading since the end of 2000. This comes after a sharp rise in September (1.3% mom), and therefore should partly be taken as a correction. Enhanced volatility in data is typical of turning points, however. In August, we saw the first negative mom reading (-0.5% mom), and with the October reading the more stable 3-month rate is now softening significantly. The yoy rate is still up 18.5% (it was above 20% in the previous 5 months), but is likely to moderate quickly over the coming months.

The Halifax report seems to match with other signs of weakening in the housing market. Last week, we got the first monthly decline in the Nationwide index. The ODPM indices for September and October are not yet available, but once they are out they should show some easing as well, despite the difference in the recording method. The combination of a very high level of prices and rising interest rates has constrained affordability. New mortgage lending fell recently. Mortgage approvals, which is a leading indicator for the housing market, have declined in September to levels not seen since August 2000.

It is a further sign that the 5 interest rate hikes delivered by the BoE since November 2003 are starting to bite. We think the housing market is at a turning point, which will likely soften consumption growth over the coming months and drag the overall economic performance down. We confirm our view that GDP growth is likely to decline from an expected 3.2% in 2004 to 2.1% next year. The MPC will find some comfort in today's figures as it has been trying to engineer some moderation in house prices for quite a while. Still, it may also start getting worried as the correction could become more pronounced than what would be desirable. With this in mind, the MPC is probably done for the current interest rate cycle. This will likely become more evident in next week's Inflation Report and the minutes of today's MPC meeting to be released on the 17th. The next BoE rate move will likely be a cut (2H 2005).

[zzg113]

"The rises and falls we have seen in prices

in recent months are part of the ebb and flow of the market as it finds a new

base. "

[zzg113]

"Buyers have been putting down bigger deposits than in previous cycles. 83% of

all borrowers took out a mortgage of less than 90% of the house price in the

third quarter of 2004, according to the latest figures from the CML, compared

with 56% in 1989 and 1990.'"

Notice they are at pains to find any stat which says that this time is different from the last crash......I wonder why?

[THE MONKEY]

Finally the Monkey has come back to HPC.

The Monkey says this:

Remember to follow the way of the Monkey and let everybody know this news!

[EmpiricalBear]

Notice that the Halifax index is seasonally and "hedonically" adjusted.

I don't know how their hedonic calculations work, whether they incorporate significant fudge factors or what. Could this provide sufficient flexibility to allow them to produce a nasty figure like this just in time for the MPC meeting?

Its nice to note that the September figures were unexpectedly up, and these are unexpectedly down. Each nicely offsets the other, keeping annual HPI only slightly softening. If fudge factors were in play then perhaps these numbers could be engineered to suit the political needs of the Halifantasy.

[zzg113]

2Meterbear, didn't Freddieforecaster on Motley Fool say something like this would happen? That if the result one month was up, the next month would be down, because of the way the Halifax calculate the figures?

[THE MONKEY]

BBC have noticed this one, unlike the Nationwide figures:

http://news.bbc.co.uk/1/hi/business/3981295.stm

[zzg113]

They may well carry the story on their newsfeeds, but what is crucial is how they spin it; will it be "House prices fall for fourth month in row, housing market on its knees" or "House prices show usual seasonal weakness"? This is key IMHO.

[Bear Goggles]

They may well carry the story on their newsfeeds, but what is crucial is how they spin it; will it be "House prices fall for fourth month in row, housing market on its knees" or "House prices show usual seasonal weakness"? This is key IMHO.

<{POST_SNAPBACK}>

Ah ha! 'losing impetus' eh?

How about 'Hedonism from the Halifax makes the housing market impotent!!