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Mortgage Approvals Up Again

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Guest wrongmove

Some bad news from the BoE. BoE mortgage approvals are for house purchase only (no MEW or remortgaging) and are counted after the survey has been completed by the buyer (very few time wasters included - the survey costs several hundred pounds). Historically, they are an excellent indicator of HPI in the next 6 months (see many earlier threads). A figure over 90k has always led to positive HPI. We can only hope that the figures will drop off in response to the IR rise in August.

UK July mortgage lending shows biggest rise in 3 yrs

"...Approvals for new loans, a leading indicator of the housing market, also picked up to number 120,000 in July, up from a downwardly revised 119,000 the month before and the highest since January...."

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Some bad news from the BoE. BoE mortgage approvals are for house purchase only (no MEW or remortgaging) and are counted after the survey has been completed by the buyer (very few time wasters included - the survey costs several hundred pounds). Historically, they are an excellent indicator of HPI in the next 6 months (see many earlier threads). A figure over 90k has always led to positive HPI. We can only hope that the figures will drop off in response to the IR rise in August.

UK July mortgage lending shows biggest rise in 3 yrs

"...Approvals for new loans, a leading indicator of the housing market, also picked up to number 120,000 in July, up from a downwardly revised 119,000 the month before and the highest since January...."

This is partial good news though as it makes a rate rise more likely surely?

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This is partial good news though as it makes a rate rise more likely surely?

Oh yes. Next week hopefully :P

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Guest wrongmove

This is partial good news though as it makes a rate rise more likely surely?

Well, with that logic, everything is good news, but it is not really logic. If demand is strong, it will survive a rate rise.

120k is a very high figure - we need sustained figures of 70-80k to see any real drop in prices.

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No degree of nominal 'bubblisciousness' would surprise me if this really is the giant demographic turning point being predicted by that chap from the Fed.

What's this?

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"...Approvals for new loans, a leading indicator of the housing market, also picked up to number 120,000 in July, up from a downwardly revised 119,000 the month before and the highest since January...."

do these dates (Jan/Jul) also correspond with some seasonal LOWS discussed recently on here? I think it might have been housebuying activity? :unsure:

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Oh dear, as I predicated - no slowing down in peoples borrowing/spending

Another couple of 0.25 IR rises, they'll back down, redefine 'inflation' (CPI) and let it continue to rise

They could stop all this tommorow with a shock 0.50 raise - but they haven't got the balls...

Edited by dnd

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do these dates (Jan/Jul) also correspond with some seasonal LOWS discussed recently on here? I think it might have been housebuying activity? :unsure:

In percentage terms the "pick-up" seems a bit puny--from 119k to 120k (119/120 X 100 = 0.84%). And as June was downwardly revised we might expect the same thing for July which might take it below the June figure. THus a fall in applications could turn out to be the reality. <_<

Sounds like one of Gordon's spinmeisters trying to keep the sentiment momentum from turning too negative following the spate of bearish press of late.

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http://www.tiscali.co.uk/news/newswire.php...ate.html?page=2

The BoE said consumer credit rose by 1.122 billion pounds last month,
up from the 833 million pounds rise seen in June and higher than analysts’ forecasts of a 1.0 billion pound increase.
That boosted overall lending by nearly 11 billion pounds in July, its biggest increase since June 2004 when house prices were rising at double digit rates and commentators were sounding alarms about heavily-indebted consumers.

With the publicity about the non-effects of bankruptcy it may be the case that the mega-rise in consumer credit last month shows a Miracle Economy spending binge that may get worse for quite awhile. All the time banks will lend the money the sheeple are there to be fed. HPI-MEW-Bankruptcy-Borrow & Spend is deeply ingrained after almost 10 years of Gordon's Miracle Economy.

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Well, with that logic, everything is good news, but it is not really logic. If demand is strong, it will survive a rate rise.

If demand is indeed 'strong' now, each rate rise will reduce it, the quicker those rate rises come the quicker the (much needed) correction and the less painful it will be.

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The BOE are doing a wonderful job encouraging debt. It really is stupendous.

TILL IT ALL HAS TO BE PAID BACK OR DEFAULTED ON.

But then their political paymasters will be long gone and the gongs will have been handed out.

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http://www.bloomberg.com/apps/news?pid=206...4w&refer=uk

Bloomberg
Some of the increase may be due to consumers using mortgage debt to finance their spending rather than more expensive credit from other sources, said George Buckley, an economist at Deutsche Bank AG in London. There were net repayments of debt to non-bank specialist lenders, retailers and insurance companies last month..../
Within this, lending on credit cards grew to 155 million pounds, up from 67 million pounds in June, and other lending increased to 967 million pounds from 765 million pounds.
M4, the broadest measure of U.K. money supply, rose 13 percent in the year through July.
:o

It will be interesting to see if Gordon has taken on a Neroesque attitude and will fiddle the CPI while the country burns?

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What a surprise!

BBC report it UK mortgage lending rises sharply

The strength of the property market has been highlighted by the latest mortgage figures from the Bank of England.
The number of new mortgages approved for house buying, but not yet lent, rose again in July to 120,000 - the highest level since the start of 2006.
Approvals have been rising steadily this year and are up 24% on a year ago.
Meanwhile the amount of money actually lent on new mortgages in July was £9.8bn, the second highest monthly figure on record.
The continued acceleration in the value of mortgage borrowing has helped to drive up the total amount of debt owed by individuals in the UK.
This rose by another £10.9bn in July, pushing the outstanding level of personal debt to £1.24 trillion.
However, other forms of borrowing by consumers are continuing to slow down.
The annual rate of growth of borrowing through methods such as credit cards, bank loans and hire purchase agreements, fell to 7.2%.
This was exactly half the growth rate recorded in December 2004.
Price predictions
Mortgage approvals are widely seen as a good indicator of future activity in the property market and
suggest the current buoyancy of the market has a long way to run
, despite the recent small rise in interest rates.
Earlier this month the Royal Institution of Chartered Surveyors (RICS)
predicted that house prices were likely to rise even faster in the coming months.
Its latest survey suggested that prices in July had been rising at their quickest rate for two years.
The number of enquiries from prospective buyers also rose, for the 14th month in a row.

Just keep pumping out that good news BBC!

Hang on didnt Pravda the beeb omit to report [on radion, TV and website] last weeks BBA mortgage figures showing a 20% fall in mortgage applications? Mortgage Applications Drop "sharply" In July

I guess when they're awash with good news its easy to overlook minor matters

Tractor production up 500%!

Edited by jp1

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BBC: http://news.bbc.co.uk/1/hi/business/5297672.stm

Total debt is now £1.24 trillion

http://www.brillig.com/debt_clock/

U.S. NATIONAL DEBT CLOCK

The Outstanding Public Debt as of 30 Aug 2006 at 10:01:15 AM GMT is:

$ 8 , 5 0 7 , 8 4 0 , 1 1 2 , 5 3 3 . 9 5

The estimated population of the United States is 299,402,699

so each citizen's share of this debt is $28,416.04.

If we have 60m people our debt is 1.24T/60m = 20,666 pounds or $39,265. Compared with the US at $28k per head.

Gordon, mate, what HAVE you done???? :o

Edited by Realistbear

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That BBC article basically says house prices will start accelerating and the interest rate rise will have no effect. Debt has gone from 1 trillion to 1.24 trillion in a short space of time, the public still think property is a one way bet to riches.

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Guest Alright Jack

Surely 1.3 trillion is the biggest number in the universe... What about 1300000000001 ?

We talk about trillions today in pretty off the cuff sort of fashion. What comes after a trillion I wonder? Why do certain members on HPC still, DESPITE ALL THE EVIDENCE, believe that there exists some kind of a ceiling for money creation? It defeats me. The currency expands without limit regardless of whether it is simply monetised or created under the disguise of debt.

Honest to god I almost give up. You can lead a horse to water but there comes a point when it is time to leave the mentally or physically feeble behind.

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No degree of nominal 'bubblisciousness' would surprise me if this really is the giant demographic turning point being predicted by that chap from the Fed.

Your demographic info is very interesting, but takes no account of changes which are happening to the demogrpahic profile due to immigration which is an important factor when we are adding 600,000 mostly young people each year at the moment to our population - many of these people will have kids. Expect the birth rate to rise substantially.

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That BBC article basically says house prices will start accelerating and the interest rate rise will have no effect. Debt has gone from 1 trillion to 1.24 trillion in a short space of time, the public still think property is a one way bet to riches.

Yes its all a self fulfilling prophesy isnt it? Mortgage applications are up indicating that HPI will be strong in 6 months time so people think its a good bet to offer the asking price on a property.

The vast majority of people neither know nor care about Japanese interest rates and the Yen carry trade, mounting inflation pressures and the likely direction of future interest rates, the slowdown of Australian and US property markets (never reported in the UK media and even if they were, "It couldn't happen here") etc. All they see is a one way bet to be backed at all costs.

Its not about fundamentals, its all about sentiment and I dont know what its going to take to make sentiment turn, so deeply ingrained is the British love affair with property and rising house prices. I do agree however, that when sentiment does turn it will be ugly.

Relatives of mine have just bought in a South coast town using an interest only celf cert mortgage. They are jubilant that prices "will soar here in the next ten years" and to strengthen their case, an estate agent recently told some friends of theirs who also bought something there last year that that house is now worth 20% more than they paid 1 year ago. Of course they take this as gospel. Ive tried to tell them but now Ive given up and, you know what? Im starting to wonder who really is right.

Edited by Johnny Cash

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Yes its all a self fulfilling prophesy isnt it? Mortgage applications are up indicating that HPI will be strong in 6 months time so people think its a good bet to offer the asking price on a property.

The vast majority of people neither know nor care about Japanese interest rates and the Yen carry trade, mounting inflation pressures and the likely direction of future interest rates, the slowdown of Australian and US property markets (never reported in the UK media and even if they were, "It couldn't happen here") etc. All they see is a one way bet to be backed at all costs.

Its not about fundamentals, its all about sentiment and I dont know what its going to take to make sentiment turn, so deeply ingrained is the British love affair with property and rising house prices. I do agree however, that when sentiment does turn it will be ugly.

Relatives of mine have just bought in a South coast town using an interest only celf cert mortgage. They are jubilant that prices "will soar here in the next ten years" and to strengthen their case, an estate agent recently told some friends of theirs who also bought something there last year that that house is now worth 20% more than they paid 1 year ago. Of course they take this as gospel. Ive tried to tell them but now Ive given up and, you know what? Im starting to wonder who really is right.

The very art of VI propaganda. To saturate the sheeple with a constant flow of information supporting their HPI cause that even lies become truth and accepted as such. When you begin to doubt the truthfulness of propaganda they have won the day. Of course, it only works while the market sustains the position and the economic cycle is no respecter of propaganda or, as it is more commonly know, bovine excretia.

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In percentage terms the "pick-up" seems a bit puny--from 119k to 120k (119/120 X 100 = 0.84%). And as June was downwardly revised we might expect the same thing for July which might take it below the June figure. THus a fall in applications could turn out to be the reality. <_<

Sounds like one of Gordon's spinmeisters trying to keep the sentiment momentum from turning too negative following the spate of bearish press of late.

You should apply for a job with the Labour party. You are a better spinmeister than any of them.

120,000 a month would make 1.44 million property transactions a year - a record and indicative of a bull market.

I am beginning to think BTL, even at current yields, has plenty of legs left yet as, if this level of activity carries on, prices will continue to rise.

The very art of VI propaganda. To saturate the sheeple with a constant flow of information supporting their HPI cause that even lies become truth and accepted as such. When you begin to doubt the truthfulness of propaganda they have won the day. Of course, it only works while the market sustains the position and the economic cycle is no respecter of propaganda or, as it is more commonly know, bovine excretia.

The economic cycle is an illusion.

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Guest Alright Jack

The very art of VI propaganda. To saturate the sheeple with a constant flow of information supporting their HPI cause that even lies become truth and accepted as such. When you begin to doubt the truthfulness of propaganda they have won the day. Of course, it only works while the market sustains the position and the economic cycle is no respecter of propaganda or, as it is more commonly know, bovine excretia.

:lol::lol::lol:

It is a deadly trap for these morons. We should get a load of t-shirts printed up with

"Just hand the keys back"

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You people crack me up.

As I already posted in a previous thread (shot down in flames by the caffeine-fixated SludgeHead) my niece and partner just started trying to buy a flat. They have 2 offers on at the moment, and they have mortgage offers on both with 2 different mortgage co (via brokers).

They don't own a flat, are unlikely to make it to completion, yet have just added 2 more 'mortgage approvals' to the pile.

The mortgage approval figures are good predictors until they stop working - the point usually being the start of the collapse when the approval to completion ratio also falls thru the floor.

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  • 302 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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