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Persimmon Chairman: Uk Mortgage Market Is Too Disciplined! To Get Itself Into A Us Style Sub-prime Crisis

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http://business.guardian.co.uk/houseprices...2153159,00.html

'Disciplined' UK should avoid mortgage crisis

Julia Kollewe

Tuesday August 21, 2007

Guardian Unlimited

Persimmon chairman John White said this morning that the UK mortgage market was too "disciplined" to get itself into a US style sub-prime crisis.

Mr White said: "I believe the UK mortgage market is far more disciplined and this will hold us in good stead."

He added Britons had learned their lessons about negative equity in the late 80s and early 90s, when house prices tumbled.

Unlike recently merged rival housebuilders Taylor Woodrow and George Wimpey, which have both admitted experiencing problems in the US, Persimmon is not directly affected by the US sub-prime mortgage crisis.

Persimmon today posted a 9.8% rise in pre-tax profits to £281.1m for the first six months of the year. It expects the housing market to keep growing despite higher interest rates.

Mr White said there could be one more "small" rate increase - which would take rates to 6% - but because there is such an undersupply of housing in the UK, he was unperturbed. He believes house prices will grow by 3% over the whole year.

"The market remains competitive and challenging, but it's a market we can work in," he said. "You can see it going along at similar levels."

What a charlatan! we'll see if Britons had learned their lesson or not about negative equity. The lenders have been moving the goal posts to lend 5-6-7+ times salary mortgages to those who can't afford nor service the debt otherwise.

Too many people are in too much debt that is not sustainable and the main reason for that is they have mortgage they should have not been offered, but John White thinks UK mortgage market is disciplined.

What planet does he live on?

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Guest The_Oldie
What planet does he live on?

He's doing his job, what else can he say? Although, as I posted in another thread, he was not very convincing in a Bloomberg TV interview this morning.

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I have never heard the MD of a company say were screwed, sell our shares.

Right up untill the moment the share price tumbles they keep up the BS.

As to his point about negative equity, it aint negative untill prices crash.

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He's doing his job, what else can he say?

true, but if he's still in position 12 months from now this should be brought up before him. The shareholders deserve nothing less.

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Persimmon chairman John White said this morning that the UK mortgage market was too "disciplined" to get itself into a US style sub-prime crisis.

Saw this creature being interviewed on CNBC this morning , came across as a hard , self interested bigot who is only interested in talking his market up , after all thats his job . You should have a look at Duncan Davidson owner of Persimmon , treble lensed glasses on a large black frame , spits and splutters his way through a conversation and looks the sort who spends his time hanging round the local parks toilets :lol:

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Mr White said there could be one more "small" rate increase - which would take rates to 6% - but because there is such an undersupply of housing in the UK, he was unperturbed. He believes house prices will grow by 3% over the whole year.

So as houseprices have already risen by more than 3% to date, he is expecting a fall in house prices for the rest of the year to bring it back to the 3% figure. How come he is so sure that once they have fallen back to the 3% mark that they won't continue to fall?

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The markets don't believe him either

Last Trade: 1,219.00 p

Trade Time: 11:51AM

Change: Down 31.00 (2.48%)

Prev Close: 1,250.00

Open: 1,265.00

Bid: 1,218.00

Ask: 1,221.00

1y Target Est: 1,498.38p

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To be fair to John who is after all, just being be John, is that he is probably unaware that problems are mounting for UK Subprime loans, which of course, don't exist in the UK market ;) :

http://www.themovechannel.com/News/2007/August/21e.asp

Problems mount for sub-primers

Tuesday, August 21, 2007

Prospective home owners with poor credit histories are finding it more and more difficult to obtain mortgages…
At least six UK sub-prime lenders have increased their interest rates or withdrawn their mortgage ranges. It follows the liquidity crunch in the financial markets caused by mortgage defaults in the United States as the housing market slowed dramatically Bad debts
"The borrowers who will notice most are those with the most adverse credit," said Ray Boulger of mortgage brokers John Charcol.

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