Levy process Posted January 11, 2007 Share Posted January 11, 2007 (edited) It has been a great days for the bears today, and they are rightly enjoying the party. But I predict that within two weeks, this rate rise will largely forgotten about in the press. In the meantime, we'll have had at least one bit of news showing the stubborn strength of the house market. In my opinion, the BOE felt they could raise rates today because the figures, especially recent mortgage approvals are so very strong, that they've no real worries about the market. A 0.25% rise is a small event. The fact it follows close on the heels of another two is perhaps more significant. But I think the excitement will pass. While I think we are finally leaving the era of surging HPI, I really don't think we are anywhere near the tumble that most are expecting on here. Interesting times though. Edited January 11, 2007 by Levy process Quote Link to comment Share on other sites More sharing options...
HOUSEHUNTER Posted January 11, 2007 Share Posted January 11, 2007 It has been a great days for the bears today, and they are rightly enjoying the party.But I predict that within two weeks, this rate rise will largely forgotten about in the press. In the meantime, we'll have had at least one bit of news showing the stubborn strength of the house market. In my opinion, the BOE felt they could raise rates today because the figures, especially recent mortgage approvals are so very strong, that they've no real worries about the market. A 0.25% rise is a small event. The fact it follows close on the heels of another two is perhaps more significant. But I think the excitement will pass. While I think we are finally leaving the era of surging HPI, I really don't think we are anywhere near the tumble that most are expecting on here. Interesting times though. What a party pooper :angry: Quote Link to comment Share on other sites More sharing options...
dubsie Posted January 11, 2007 Share Posted January 11, 2007 A rise of 0.25% when the economy isn't doing a lot is a bad sign. But they are blaming wages....I'm not sure about anyone else but my wages are staying the same. Quote Link to comment Share on other sites More sharing options...
DONT PANIC !!! DONT PANIC !!! Posted January 11, 2007 Share Posted January 11, 2007 (edited) I agree that its too early to tell if there will be a HPC but if inflation it taking off and they need multiple raises then IMHO a HPC will be unavoidable. How many recent FTB's can pay the mortgage if IR's goto 6.5% ? I'd guess many would default and the recent BTL's would have to bail. The US economy seems to be doing OK whilst at the same time they have a HPC. Dow at record close now. This has got to be good news for the bears as the central banks can go higher Edited January 11, 2007 by DONT PANIC !!! DONT PANIC !!! Quote Link to comment Share on other sites More sharing options...
Ah-so Posted January 11, 2007 Share Posted January 11, 2007 It has been a great days for the bears today, and they are rightly enjoying the party.But I predict that within two weeks, this rate rise will largely forgotten about in the press. In the meantime, we'll have had at least one bit of news showing the stubborn strength of the house market. In my opinion, the BOE felt they could raise rates today because the figures, especially recent mortgage approvals are so very strong, that they've no real worries about the market. A 0.25% rise is a small event. The fact it follows close on the heels of another two is perhaps more significant. But I think the excitement will pass. While I think we are finally leaving the era of surging HPI, I really don't think we are anywhere near the tumble that most are expecting on here. Interesting times though. How many small events do you need for them to start counting as a big event? You may not be expecting a tumble, as are few others, but the nature of crashes and sharp corrections is that they are unexpected by the masses. Quote Link to comment Share on other sites More sharing options...
Layman Posted January 11, 2007 Share Posted January 11, 2007 While I think we are finally leaving the era of surging HPI, I really don't think we are anywhere near the tumble that most are expecting on here.Interesting times though. I have to agree. We need to be sensible.... Next week you're not going to be able to log on to rightmove.co.uk and find 5 bedroom detached houses down from £400k to £300k .... And papers aren't going to have over-hyped headlines until markets have times to shake out. It's gonna take a while. For those desperate to buy a house and who are in it for the long term, you're going to find more flexibility in negotiating with sellers... and if you can beat them down a bit and you're comfortable with that deal then good for you. I would love to see everything tumble in three to six months but my feeling is it just ain't gonna happen. Some "positive" (ie negative) stats on house prices and sales volumes over the coming quarter will be welcome... But don't hold your breath. I'll personally be happy to just see the huge rises cease and for us all to begin to appear vindicated beginning autumn/winter 2007. Hold in there folks. Don't get dismayed in a month's time when "nothing's happened" - it will be happening... just under the covers. Quote Link to comment Share on other sites More sharing options...
powerswitch_gd Posted January 11, 2007 Share Posted January 11, 2007 A rise of 0.25% when the economy isn't doing a lot is a bad sign. But they are blaming wages....I'm not sure about anyone else but my wages are staying the same. It'll be those whopping city bonuses before xmas. Now they need to chop everyone else's to compensate Quote Link to comment Share on other sites More sharing options...
Layman Posted January 11, 2007 Share Posted January 11, 2007 It'll be those whopping city bonuses before xmas. Now they need to chop everyone else's to compensate Bonuses are actually paid in Jan/Feb at most institutions... It's just that a few people are given indications as to what they'll get and go round mouthing off. Quote Link to comment Share on other sites More sharing options...
Jason Posted January 11, 2007 Share Posted January 11, 2007 No, but if rates went up in Feb that would be one big massive kick in the balls wouldn't it: Quote Link to comment Share on other sites More sharing options...
Disillusioned ftb Posted January 11, 2007 Share Posted January 11, 2007 My thoughts are that the public are all ready primed for an interest rate rise in February. The rate rise that we have had today has surprised EVERYBODY, including the bookmakers if I’m correct. if there is a Interest rate rise in February, my thoughts are that this could be the proof of the "turning of the tide" that I personally have been waiting for, but I’m not expecting to see any house price falls this year. We still need to see people rushing to the exit. Only then will prices will fall. But I'm wondering what’s going to happen to all those buyers that have purchased a property during the last 5 yrs and stretched themselves to their absolute maximum, I wonder how they will be able to afford the "higher rate of interest" that their bank will now be charging them when their mortgages are up for renewal, so far 3/4 of a percent in 5 months. That’s well on course for a 2% rate rise per year since Aug 2006. Would these people be able to afford and extra 2% on their mortgages? I'm not an economist, but to me It looks like that the bank of england has been happy to lend out lots of money over the last couple of years, and now they want it back........ With interest!!!!!! When i first visited this site i thought that a housepricecrash was imminent, but only now I realise how slow this process can be. Roll on 2007 !!!!!! Quote Link to comment Share on other sites More sharing options...
Tempest Posted January 11, 2007 Share Posted January 11, 2007 (edited) The original post here is, excuse my french, b*llocks. In July/Aug last year if you had said, as some far sighted people on this board did, that rates would be 0.75% higher in 5 months you would have been committed. And as we all know, central banks ALWAYS (historically) undershoot meeting inflation targetting when things have got out of hand. If anyone thinks this will not moderate prices they are dreaming. Aside from London which had some lost ground to claw back from 2005 late 2006 was poor nationally. My estate agent said today that there we loads of houses coming on having been valued after xmas.... The "top", once recognised, is too late. It has been recognised. Aug-Nov 06. Edited January 11, 2007 by Tempest Quote Link to comment Share on other sites More sharing options...
Guest Yeahbutnocrash Posted January 11, 2007 Share Posted January 11, 2007 A rise of 0.25% when the economy isn't doing a lot is a bad sign. But they are blaming wages....I'm not sure about anyone else but my wages are staying the same. Yeah, and xmas spending being higher than expected and increased fuel costs which may have risen as far as they will for a while so rates may not have to go too much higher.... but I would prefer rates to stay at a reasonable level and help to curb any further rampant HPI Oh and what about increasing rail & bus fares? - that must also contribute to inflationary pressure And another thought - With the cost of the Olympics potentially spiralling out of control someone is going to have to pay for that The higher IR's may be needed to curb our spending so we have enough dosh left to pay all the taxes.. Quote Link to comment Share on other sites More sharing options...
killerbee Posted January 11, 2007 Share Posted January 11, 2007 Hi all, Well I've been trying to move for about six months and am now about one week away from exchanging contracts. Our ftb's seem committed but after todays rate rise I'm anxious about whether they will pull out. Watch this space...... Kbee Quote Link to comment Share on other sites More sharing options...
Guest portwinestain Posted January 11, 2007 Share Posted January 11, 2007 Mmm.. The BBC newsreader on announcing the rate rise this afternoon said 'Bad news for homeowners as interest rates..................' Not good for the pysychology, hearing words like that. Quote Link to comment Share on other sites More sharing options...
Guest Yeahbutnocrash Posted January 11, 2007 Share Posted January 11, 2007 (edited) My thoughts are that the public are all ready primed for an interest rate rise in February. The rate rise that we have had today has surprised EVERYBODY, including the bookmakers if I’m correct. Good point - It was a shock to most. There may have been someone on here who had a lucky guess ( ) but on tonights news (I expect most of you heard) there was also one economist out of 50 surveyed who called it right But when he was interviewed for TV he didn't seem particularly bearish... Oh and as far as I know they didn't interview any of the other 49! - Maybe some of them are now bears! Edited January 11, 2007 by Yeahbutnocrash Quote Link to comment Share on other sites More sharing options...
bazzzzzzz Posted January 11, 2007 Share Posted January 11, 2007 I really don't think we are anywhere near the tumble that most are expecting on here. You are right-recent threads have shown recent figures on mortgage approvals shows at least another 6 months positive HPI, and we are at last a year away from yoy falls. The banks will find ever more crazy ways of extending credit and enticing BTL landlords onto the market. Quote Link to comment Share on other sites More sharing options...
bazzzzzzz Posted January 11, 2007 Share Posted January 11, 2007 The original post here is, excuse my french, b*llocks. You appear to be the minority view here. Apologies not accepted. Quote Link to comment Share on other sites More sharing options...
CrashDive Posted January 11, 2007 Share Posted January 11, 2007 Good point - It was a shock to most. There may have been someone on here who had a lucky guess ( ) but on tonights news (I expect most of you heard) there was also one economist out of 50 surveyed who called it rightBut when he was interviewed for TV he didn't seem particularly bearish... Oh and as far as I know they didn't interview any of the other 49! - Maybe some of them are now bears! If you wait for the vast majority of economists to spell it out for you then expect to be told what is already common dog much of the time. Quote Link to comment Share on other sites More sharing options...
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