R I C S Change Their Tune As Market Slows Again

[Realistbear]

http://www.tiscali.co.uk/news/newswire.php...y_template.html

REUTERS

Rise in house prices slows - RICS

18/04/2006 08:15

LONDON (Reuters) - House prices rose again in the three months to March but at a slightly slower pace as the

number of properties coming onto the market picked up

, the Royal Institution of Chartered Surveyors said on Tuesday.

The RICS said its

house prices balance eased to +13 in the three months to March from a downwardly revised +16 in February

. That was the fifth straight month of price rises.

It said low interest rates continued to underpin buyer interest

, with the number of enquiries up for a 10th month although the pace of increase has slowed since October.

Meanwhile, the number of new sellers rose at the fastest pace since June 2005, RICS said, citing rising unemployment as one factor behind the increase in homes being put up for sale

Note they no longer say strength in employment and surging demand are keeping prices high. Its just interest rates now and they will not be "low" (highest in history in relation to incomes) for much longer. Nationwide tightened last week for new borrowers and there is more to come.

The only reason EAs might be busy now is people trying to beat the rush to sell. It was DEAD in all my local EAs this past Saturday--the busiest day of the year for traditional buying frenzy.

Its over

Edited April 18, 2006 by Realistbear

[aussieboy]

Too, too much spin from you there, RB, I'm afraid.

Too much noise... too little signal.

[eurows]

RB I love your posts. This is a real shift from the usual RICS spin. In my view the tone of the VI's has changed and we have not even started yet.

[delite1]

Too much spin?

RB's just reading between the lines.

Thanks RB.

[doomwatch]

This revealed that the headline reported price balance fell to +13 in March (from +16 in Feb).

That was much weaker than the +20 the financial markets expected.

Also, the relationship that the "enquiries less instructions" balance has with the price balance points to another fall next time round.

Some might argue that a softening housing market removes one of the hurdles that have prevented the Monetary Policy Committee from cutting the repo rate in recent months.

However, with the Committee looking at many housing market indicators, this survey will only have a limited impact on the rate debate.

The most important indicator of future house prices in the survey - the sales over stocks ratio - points to a further pick-up in the annual rate of growth over the next 6 months.

[Realistbear]

Too much spin?

RB's just reading between the lines.

Thanks RB.

Thanks for the thanks all! I am getting the feeling that this Easter was the make or break for HPI and it seems that it just broke.

[aussieboy]

Too much spin?

Realistbear confirms by view of the world. I am comforted by Realistbear's postings and do not want to see any data that does not conform with what I want to hear.

RB's just reading between the lines.

I will never get a true view of the world because I am unable and / or unwilling to listen and provide credence to those who provide data which may cause me dissonance.

Thanks RB.

You mean a bit like that?

[Realistbear]

You mean a bit like that?

Was today's property news that scary for the Bulls?

[kingofnowhere]

Was today's property news that scary for the Bulls?

What is scary for the bulls? The RICS value of +13, which compares to an average since 1/1/2000 (The boom) of +16. The Sales/Stock ratio impoved, and indicates 8-9% HPI for the year. The new buyers rose for the 10th month, The RICS future price expectations was the highest for 2 years.

And Rightmove prices rise by 1.1% in a month...

Why would they be scary for anyone who is bullish?

[Spring In The Air]

Thanks for the thanks all! I am getting the feeling that this Easter was the make or break for HPI and it seems that it just broke.

Is it vanity? Crass stupidity? Or both? You look at a few estate agents in one town that are empty and read a bit of drivel from the RICS. You turn this into the delightfully vague statement that 'it seems that it (HPI) just broke'.

Do yourself a favour. Look at the number of property transactions that took place over the last 10 years at Number of properties sold over last 10 years and then go into the estate agents in your town and ask them how many people now come into their office looking for property and how many use the local paper, telephone and their web site.

You will be told, if my business is any guide, that, despite remarkably consistent numbers of sales per year over the last ten years, the number of people who come through the door is probably less than 10% compared to 10 years ago.

On a Monday morning we have anything up to 200 email enquiries to deal with. 10 years ago those 200 people would have been in the branch over the weekend.

[Realistbear]

Is it vanity? Crass stupidity? Or both? You look at a few estate agents in one town that are empty and read a bit of drivel from the RICS. You turn this into the delightfully vague statement that 'it seems that it (HPI) just broke'.

Do yourself a favour. Look at the number of property transactions that took place over the last 10 years at Number of properties sold over last 10 years and then go into the estate agents in your town and ask them how many people now come into their office looking for property and how many use the local paper, telephone and their web site.

You will be told, if my business is any guide, that, despite remarkably consistent numbers of sales per year over the last ten years, the number of people who come through the door is probably less than 10% compared to 10 years ago.

On a Monday morning we have anything up to 200 email enquiries to deal with. 10 years ago those 200 people would have been in the branch over the weekend.

"

drivel from the RICS

"

One man's drivel is another's tidings of great joy

[eurows]

Or both? You look at a few estate agents in one town that are empty and read a bit of drivel from the RICS

Now the news is turning the RICS report is drivel

[Seen It Before]

The only reason EAs might be busy now is people trying to beat the rush to sell. It was DEAD in all my local EAs this past Saturday--the busiest day of the year for traditional buying frenzy.

Its over

There is no such thing as there being a busiest day or weekend for house buying, it is not something you can turn on/off at will and if you measure the state of the market by how busy agents are when you popped in then this is not a very accurate method. You can have an office rammed full of people but if all they are are daytrippers just having a look as they are visiting relatives/friends then that is not good business but using your method this would mean an active property market.

I do not think that you can get too excited about monthly stats, quarterly is much better as the sample data is greater and therefore more accurate.

[Spring In The Air]

"

drivel from the RICS

"

One man's drivel is another's tidings of great joy

Doesn't alter the fact that if you base your belief in a house price crash on a head count of punters in estate agents - you are plain daft.

What you and lots of others on here don't get is that times change. Some of you on here keep spouting about economic cycles. You seem to believe that things must always go back to where they started. If that is true, how come the world we live in now is so different to how it was in the recession in the 1990s? We have a knowledge economy now - that wasn't even heard of then. We have stable interest rates a third of what they were then. In 10 years time I think my high street branches will be closed and it will be an office/internet based business. Maybe even a home based business with my agents working from home. How will you tell the health of the property market if you haven't got any estate agents to hang about outside? (clue: have a look at how many houses sell each year).

[delite1]

You bulls would be better off watching Japanese & US rate movements and the price of oil rather than debating here. There is an awful lot of money at stake and your betting that Gordon Brown's quest to become PM also fairs well for you. He could be wrong, he could be completely mis-guided and finally it is very likely he will be powerless to do anything about a crash.

The market is poised for a crash.You want proof? Just look how rate sensitve it has become.

Would you touch anything else that would fall over at a hint of a breeze?

Nah, you wouldn't, it's just that the housing market involves your investment, often your life's wealth, your place of residence, your family and your emotions. This is what makes it so hard to deal with and remain objective.

[Spring In The Air]

Now the news is turning the RICS report is drivel

That's rich. You lot on here spend all your time bad-mouthing the VI reports but whenever one of them says something even mildly bearish, all of a sudden it is the word of God handed down to Moses.

You bulls would be better off watching Japanese & US rate movements and the price of oil rather than debating here. There is an awful lot of money at stake and your betting that Gordon Brown's quest to become PM also fairs well for you. He could be wrong, he could be completely mis-guided and finally it is very likely he will be powerless to do anything about a crash.

The market is poised for a crash.You want proof? Just look how rate sensitve it has become.

Would you touch anything else that would fall over at a hint of a breeze?

Nah, you wouldn't, it's just that the housing market involves your investment, often your life's wealth, your place of residence, your family and your emotions. This is what makes it so hard to deal with and remain objective.

US is near top of tightening cycle. Japs won't go up much.

It's easy to remain objective if you sell houses for a living.

[Realistbear]

That's rich. You lot on here spend all your time bad-mouthing the VI reports but whenever one of them says something even mildly bearish, all of a sudden it is the word of God handed down to Moses.

US is near top of tightening cycle. Japs won't go up much.

It's easy to remain objective if you sell houses for a living.

Japs are only just starting to hike IR:

http://www.chron.com/disp/story.mpl/ap/business/3800524.html

April 18, 2006, 3:48AM

Japanese Bond Yields Rise to 2 Percent,

2006 The Associated Press

TOKYO — Yields on 10-year Japanese government bonds hit

2 percent Tuesday, their highest level in nearly seven years, amid expectations that the central bank will raise interest rates in coming months

.

Bernanke is not listening to the US Realtors:

http://business.timesonline.co.uk/article/...2138142,00.html

It seems, then, that there is only one convincing reason why Bernanke might tighten beyond 5 per cent or 5.25 per cent. It may turn out that 5.25 per cent is simply not high enough to slow the American economy to below trend growth. This is what many economists and investors now believe.

Consensus forecasts are now being adjusted upwards instead of downwards (as the Fed would prefer)

.

HPI of 250% and no crash? Seems highly improbable.

[Spring In The Air]

Interest Rates in the states have been used to control growth in the economy. Yet the US economy, like ours, seems to be based on debt. What's going to happen when people cannot borrow any more? Well the answer is, and you lot are not going to like it, that Interest Rates are going to come down again.

And the morons that run our economy will breathe a sigh of relief and drop ours. Debt will continue to grow and so will house prices.

It's very simple. Even massive jumps in the oil price haven't caused inflation. Globalization pressures mean we are in for a long-term rough ride and low Interest Rates will be used to try to continuously stimulate demand.

[Father Fred]

That's rich. You lot on here spend all your time bad-mouthing the VI reports but whenever one of them says something even mildly bearish, all of a sudden it is the word of God handed down to Moses.

That is the most spot on thing posted on this forum in about 3 months.

Edited April 18, 2006 by Father Fred

[jenko3000]

Debt will continue to grow and so will house prices.

For ever and ever? Or until the level of debt becomes unsustainable?

Once bankruptcies, repossessions and redundancies start rising (perhaps at record rates), then I'll start to worry.

[Realistbear]

Interest Rates in the states have been used to control growth in the economy. Yet the US economy, like ours, seems to be based on debt. What's going to happen when people cannot borrow any more? Well the answer is, and you lot are not going to like it, that Interest Rates are going to come down again.

And the morons that run our economy will breathe a sigh of relief and drop ours. Debt will continue to grow and so will house prices.

It's very simple. Even massive jumps in the oil price haven't caused inflation. Globalization pressures mean we are in for a long-term rough ride and low Interest Rates will be used to try to continuously stimulate demand.

Bernank'e chief concern is inflation (see Times article referred to in my above post). The Fed can see the Elephant in the living room whereas Gordon and his BoE cronies keep telling us that there is nothing in the living room but the miracle economy. When Gordon tells us that inflation is 2% the average person knows he is lying because they look at their bills and see fuel cost, council tax, travel and the upcomimng TV license hike and know that inflation that affects our household budgets is rampant.

The BoE really have little say in IR policy because we have handed that decision to our creditors who call the shots from now on. Japan is raising the rates because they must--they do not want inflation in their economy and, like the Fed, are willing to do something about it other than lie to their people that everything is fine-vote for me etc.

When the recession bites harder in the UK due to falling employment and higher rates we are just going to have to live with it. House prices will fall but who really cares--the average owner who is not too heavily leveraged will just lose notional value (house prices are, after all, just opinion whereas debt is real). Investors and those who took out teaser rate and IO mortgages will suffer but this may only be 30-40% of the overall market. The majority of OO's will do just fine.

Edited April 18, 2006 by Realistbear

[benjamin]

http://news.bbc.co.uk/1/hi/business/4918170.stm

[Realistbear]

http://news.bbc.co.uk/1/hi/business/4918170.stm

Not a word--not a single word--about RICS warning about slowing market, more sellers and rising unemployment causing drop in optimism!

[Realistbear]

Not a word--not a single word--about RICS warning about slowing market, more sellers and rising unemployment causing drop in optimism!

I just emailed them to ask why they didn't tell the whole story from RICS. As if we didn't already know.

[BoredTrainBuilder]

Too much spin?

Realistbear confirms by view of the world. I am comforted by Realistbear's postings and do not want to see any data that does not conform with what I want to hear.

RB's just reading between the lines.

I will never get a true view of the world because I am unable and / or unwilling to listen and provide credence to those who provide data which may cause me dissonance.

Thanks RB.

You mean a bit like that?

You mean a bit like that?

Eerily similar to the comfort people take in highly implausible religious beliefs.

Once the idea's inside the brain, the idea itself repels all alternative ideas and thereby self-perpetuates.

Sounds great, though, to have only certainties.