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It is different this time

Average Home Hits £210,000

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Ohh dear, I guess Mr Merv & his gang's policy of "wait & see" is not working as 0.25% rate rise now & then just won't do it. Maybe they are just waiting and praying that prices will cool & inflation will go away as "Good things come to those who wait"

http://www.thisismoney.co.uk/mortgages/hou..._id=57&ct=5

Average home hits £210,000

Simon Lambert, This is Money

11 June 2007

The price of property leapt by £2,500 in April according to official figures which revealed that the average UK home now costs almost £210,000.

House price inflation picked up during the month having slowed slightly in March, according to the latest Government figures which lag behind recent studies that have indicated the market may be cooling. The Department of Communities and Local Government said April saw the cost of a typical home increased by 1.2% to stand at £209,454 with annual house price inflation rising to 11.3%.

London continued to dominate the English property market, with annual inflation of 14% pushing the average price of a home in the capital above £320,000. Meanwhile, the surge in prices in Northern Ireland continued, with prices rising 54% over the past year, despite warnings of a potential crash over the border in the Republic of Ireland.

The average Northern Irish home now costs £228,208 - almost £12,000 more than the average English home which will set buyers back £216,707.

Prices in Wales and Scotland increased to £162,170 and £155,516 respectively in April. Conditions for first-time buyers remain tough, with a monthly hike of 1.3% meaning new buyers face paying £159,977 to get on the property ladder - with a further £1,600 in stamp duty having to be handed over to the taxman.

Recent reports by Nationwide and Halifax have indicated that the property market has begun to cool, with both showing growth easing back in May.

Experts have said that a combination of affordability problems and concern about further interest rate rises are putting off buyers.

Howard Archer, chief UK economist at analysts Global Insight, said: 'It does appear overall that the housing market is starting to come off the boil as demand is increasingly pressurised by the rising affordability pressures stemming from higher interest rates, modest real disposable income growth and elevated house prices.

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do you think its reasonable to expect HPI to go from +14% in 1 year to 0 or even -% the following?

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do you think its reasonable to expect HPI to go from +14% in 1 year to 0 or even -% the following?

Anything is possible,it went from plus 50% in 1989 to zero in 1990 in my area the East Midlands in great crash 1.

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To be fair, they do have to be careful with how quickly they raise rates. Remember, most buyers go onto fixed rate deals for the first 2 years or so. So there is going to be a lag between tightening and seeing the results of that tightening play out, both in the housing market, and in the overall economy. If they raise too quickly, they risk seriously breaking something! (Wouldn't be the first time! :rolleyes: ) It could get real ugly if that happened. One scenario could be the UK forced into further credit tightening (as the pound plummets and investors flee) into a recession, while (imported) inflation starts going parabolic. A worst-case scenario..

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aH YEAH, but, no but

Merv said personal debt is a social problem, not a macro economic problem.

Rates the rates if he still singing from that song sheet.

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Merv said personal debt is a social problem, not a macro economic problem.

Rates the rates if he still singing from that song sheet.

Well the song sheet he's supposed to be singing from is "2% inflation" and he's decidedly out of tune right now.

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aH YEAH, but, no but

Merv said personal debt is a social problem, not a macro economic problem.

Rates the rates if he still singing from that song sheet.

a social problem deliberately architected by the BOE and the Government for them to be able to polish their turd. Hopefully the near future will show them for what they are.

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Well the song sheet he's supposed to be singing from is "2% inflation" and he's decidedly out of tune right now.

and has been for a year!

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Don't forget, Merv is still well into accommodative territory and his decision to remain vigilant* last Thursday is indicative, IMO, of weakness rather than strength in the economy. When the minutes are published and if they are not heavily censored, I would not be surprised to see some comments to the effect that the slowing house market will bring other inflationary sectors inline. Its what the Fed are now saying which is why they are standing pat. Great Crash 2 is building and it looms large as the greatest threat to the world economy.

________________

* Vigilant: watching eagerly but not actually doing anything.

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do you think its reasonable to expect HPI to go from +14% in 1 year to 0 or even -% the following?

I think it is not reasonable to expect HPI to from +14% to just 0 as it should go to -14%!. Why not? There is no justification why we should still talk about 14% HPI. UK plc owes the highest debt in Europe, we have the highest house prices in Europe and the average house price in 99% of towns was unaffordable for the typical nurse in March, while 97% of towns were beyond the finances of fire service employees. This is money

Perhaps you could tell us, after all, why you think it is not reasonable to expect 0% HPI or -%. If these muppets, at BOE, did their job properly maybe we wouldn't be in that mess today. They couldn't cut the rates quick enough, month after month, to fuel miracle economy when HPI was booming by 25% a year now the game is over & pay time. They are just delaying the inevitable to make sure their boss gets into no 10 before the sh&ts hits the fan.

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do you think its reasonable to expect HPI to go from +14% in 1 year to 0 or even -% the following?

I think 1% falls per month are reasonable to expect, how far before the plunge protection team then intervene for fear of not being knighted, in order to keep the muddled classes and their paymaster happy, will be anyones' guess. <_<

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And this is the problem with a fiat based system.

They can pump money into system when they feel like it and withdraw it when they feel like it - that means we can be manipulated when they feel like it - we are never free - they are allways in control.

Without a banking system that guarantees the fruits of your labour and its buying power free from external manipulation then we are as slaves with masters that control our every move.

Maybe Bruno (remember him) was right after all - you are better off going with the flow but getting out before you get too greedy. There is no such thing as fair value if the markets are manipulated because their is no such thing as market value attached to currencies that are manipulated in this way.

Look at the BoE - they are still behind the curve - what more evidence do we need to see that they are not interested in taming 'real' inflation.

At this rate they will have boiled the frog to death and soon it will be time for hyperinflation - don't think so? - they why has the BoE always hesitated in raising interest rates when faced with news that the stock market has twitched down by 50-100 pts - is that in their remit?

I have long suspected that the BoE are acting on a different agenda - that agenda is to devalue - it will do this most efficienctly through inflation - albeit inflation that is hidden from the the public view.

HAL

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Guest Bart of Darkness
and has been for a year!

And likely to continue to be so for a good while yet.

To be fair to Merv, he can't totally control what the other muppets do, especially king of the muppets, Danny "I drove my wife into the arms of another woman" Blanchflower.

(Always like to bring that up! :) )

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