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Perfectionist

House Price Inflation Picks In April ....

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This is the lagging effect of the ODPM survey.

It is several months behind.

Where I am, the market has slowed significantly after the rally over X-Mas and into the new year, caused by the August rate cut and the muppets believing the papers about the rate cut being the first of many.

Mortgage approvals are trending downwards and there are interest rate rises in the pipeline.

Also, a CURRENT indicator, the builders stocks has taken an absolute hammering over recent weeks.

We will start seeing some nominal falls again later this year, potentially in September, coupled with rising interest rates.

The August rate cut will have done more damage than good over the medium term for the UK housing market. It has propelled prices up a little further from reality, which will mean that the risks are even more to the downside when we get the rate hikes.

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It wopuld be nice to have a reliable and up-to-date survey. The ODPM report is a good guide to the past at least and is useful for predicting a trend.

Around here prices are still sinking and our local property sheet has more "unexpectedly back on the market" ads than a month ago and larger numbers of "new price" (price reduced) ads.

Employment is weighing heavily on the minds of would-be house buyers or MEWers and the latest LLoyds-TSB poll shows a lot of negative sentiment which is key to the house market (see thread on this).

As the BBC article points out, the May figures started to show another downturn and this will show up several months from now in the ODPM's next set of Q figures.

Bottom line, we are still on course. HPCs happen from hindsight and we are only just in the 1st year of a possible 7 year correction (if we follow the Great Crash pattern).

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It wopuld be nice to have a reliable and up-to-date survey. The ODPM report is a good guide to the past at least and is useful for predicting a trend.

Rightmove, is as up todate as possible. Here it is offset against Rightmove, and it has a correlation of 0.92% (very strong). So you can see what will IMHO be happening to ODPM numbers over the coming months.

	ODPM	RighmoveDec	2002	22.1%	22.1%Jan	2003	20.5%	26.5%Feb	2003	21.7%	23.5%Mar	2003	17.8%	22.5%Apr	2003	13.4%	17.8%May	2003	14.6%	15.6%Jun	2003	14.0%	14.0%Jul	2003	11.0%	13.2%Aug	2003	12.1%	12.4%Sep	2003	9.7%	9.1%Oct	2003	8.3%	9.8%Nov	2003	9.7%	9.9%Dec	2003	9.8%	9.6%Jan	2004	7.8%	15.7%Feb	2004	10.0%	16.9%Mar	2004	12.2%	17.4%Apr	2004	13.9%	18.5%May	2004	14.3%	19.5%Jun	2004	13.6%	20.3%Jul	2004	13.7%	20.7%Aug	2004	12.6%	20.3%Sep	2004	13.7%	19.6%Oct	2004	10.7%	17.9%Nov	2004	10.0%	16.5%Dec	2004	10.5%	14.8%Jan	2005	12.6%	13.6%Feb	2005	6.9%	11.9%Mar	2005	6.0%	10.1%Apr	2005	5.0%	8.1%May	2005	4.0%	6.1%June	2005	2.8%	4.5%July	2005	3.2%	3.0%Aug	2005	1.6%	2.6%Sept	2005	2.2%	2.6%Oct	2005	2.9%	3.3%Nov	2005	4.1%	3.7%Dec	2005	3.4%	4.2%Jan	2006	3.3%	4.4%Feb	2006	5.1%	4.7%Mar	2006	 	5.3%Apr	2006		6.2%May	2006	 	7.0%

Correl 0.92282718

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Yes. The lax lending and wealth redistribution continues.

I know 2 poeple who have just signed their financial death warrents. Maxed out IO mortages. 2 year fixes. Unless interest rates remain low forever and wage inflation picks up they'll be renting off the bank for the rest of their lives.

The end of loose lending may or may not be close, but I don't see how house prices can fall whist the banks continue to lend anything to anyone, regardless of their income and the potential consequencies.

The shame of it!

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The ODPM is obviously lagging a little behind (as KoN points out) but the general agreement amongst the indices is actually quite good.

Comparing YoY HPI – Rightmove, ODPM MA, FT HPI-MA, Halifax, Nationwide

143zw55.jpg

Edited by spline

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As far as I'm concerned it's all going very much as I thought it would. I said (on a number of occasions) that I expected a strong Spring bounce tailing off during the summer. I reckon they'll barely be any movement in the Autumn, but it will certainly start going downhill if there's a second IR hike.

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As far as I'm concerned it's all going very much as I thought it would. I said (on a number of occasions) that I expected a strong Spring bounce tailing off during the summer. I reckon they'll barely be any movement in the Autumn, but it will certainly start going downhill if there's a second IR hike.

I agree .. and todays data just makes it easier for the MPC to hike rates.

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The ODPM is obviously lagging a little behind (as KoN points out) but the general agreement amongst the indices is actually quite good.

Comparing YoY HPI – Rightmove, ODPM MA, FT HPI-MA, Halifax, Nationwide

143zw55.jpg

Hi Spline

Here is Hometrack.

2003	Jan	13.7%Feb	12.2%Mar	10.4%April	8.3%May	5.4%June	3.4%July	2.1%Aug	1.4%Sept	1.2%Oct 	1.1%Nov	1.3%Dec	1.3%Jan	1.5%Feb	1.8%Mar	2.8%April	3.5%May	4.4%June	5.7%July	5.5%Aug	5.4%Sept	4.7%Oct 	3.7%Nov	2.7%Dec	1.7%Jan	0.9%Feb	0.3%March	-0.7%April	-1.5%May	-2.3%June	-3.6%July	-3.7%August	-3.7%Sept	-3.5%Oct 	-3.1%Nov	-2.5%Dec	-1.6%Jan	-1.0%Feb	-0.5%Mar	0.1%April	0.9%May	1.6%

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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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