Guest wrongmove Posted November 17, 2007 Share Posted November 17, 2007 SLASHING RATES WILL STOP HOUSE PRICE CRASH "THE property boom will finally run out of steam next year as price rises stall but they will not crash as doom-mongers gave predicted. Britain’s biggest building society the Nationwide reported yesterday (fri) that while prices will slow across the country they will not drop dramatically. And a series of interest rate cuts in the New Year hinted at by the Bank of England could also kick start the market back into life. Other property experts last night dismissed previous pessimistic predictions and told homeowners they can expect prices to continue rising in the long term. Stuart Law, Chief Executive of Assetz, said: “The Nationwide, like most building societies, tends to significantly underestimate house price inflation at the beginning of each year. “Next year appears to be no different, with today’s prediction of 0 per cent. “In contrast, I would expect house prices to increase by five per cent in 2008.” David Newnes, managing director at Your Move estate agent, said: “Nationwide’s house price forecast for 2008 looks over-cautious. “Their forecasts don’t make enough of continued demand for property. “They also omit the potential for increased confidence through the interest rate cuts some have more recently predicted. “A buoyant property market depends on three things: strong demand, affordable interest rates and consumer confidence. “While confidence may have taken a hit after the Northern Rock fiasco, people still want to buy homes. Sustained demand together with hints of rate cuts as early as January next year, will surely help boost confidence. “Even now, interest rates remain way below the highs of years past and there’s no reason for panic. “A sure fire way to cause a crash, is to predict it – I have to ask myself why the Bank fo England and Nationwide are encouraging over-cooked pessimism?”.................." Why does this article make think of this ? [parental advisory - contains rude words] Quote Link to comment Share on other sites More sharing options...
South Lorne Posted November 17, 2007 Share Posted November 17, 2007 ...they live in the land of simpletons.... Quote Link to comment Share on other sites More sharing options...
Ash4781 Posted November 17, 2007 Share Posted November 17, 2007 Assetz Quote Link to comment Share on other sites More sharing options...
BossCat Posted November 17, 2007 Share Posted November 17, 2007 OK, here goes... The property boom will finally run out of steam next year as price rises stall but they will not crash as doom-mongers gave predicted. Could be realistically argued from VI sources that prices in many areas have already stalled. Also, why is a someone who talks up a market and "expert" and one who predicts downward trends a "doom-monger". This is blatant use of emotional words to convey a message and is poor argument. More of this later... Britain’s biggest building society the Nationwide reported yesterday (fri) that while prices will slow across the country they will not drop dramatically. OK, maybe and maybe not. Evidence of such? And a series of interest rate cuts in the New Year hinted at by the Bank of England could also kick start the market back into life. Maybe the BoE cut rates maybe they don't. Doesn't seem to be doing much for the US market at the moment so why would it have that effect here? Other property experts last night dismissed previous pessimistic predictions and told homeowners they can expect prices to continue rising in the long term. Oh look, there's that "expert" word again used in conjunction with predictions of prices continuing to rise (in the long term - define please!). Evidence, argument? What experts and from where? Stuart Law, Chief Executive of Assetz, said: “The Nationwide, like most building societies, tends to significantly underestimate house price inflation at the beginning of each year. Your (the writer of the original article) point is what, exactly? The Nationwide are incompetent? How many times have you used their predictions of house price rises as "evidence"? now, zero growth is a mistake. "Most" building societies, I'm sure will be suitably chastised by Assetz superior competence in predictions. David Newnes, managing director at Your Move estate agent, said: “Nationwide’s house price forecast for 2008 looks over-cautious. Oh, well the MD or Your Move would provide a considered counterbalance to the argument then. Lets not ask Nationwide though as that would just complicate the argument. “Their forecasts don’t make enough of continued demand for property. Of course they don't, after all Nationwide are a bunch of idiots who would not have thought of that when making their calculations. “They also omit the potential for increased confidence through the interest rate cuts some have more recently predicted. Predicted. Eggs - chickens - hatched..... “A buoyant property market depends on three things: strong demand, affordable interest rates and consumer confidence. “While confidence may have taken a hit after the Northern Rock fiasco, people still want to buy homes. Sustained demand together with hints of rate cuts as early as January next year, will surely help boost confidence Ooooh, "will surely"! sounds a bit like wishful thinking to me. Evidence or speculation? “Even now, interest rates remain way below the highs of years past and there’s no reason for panic. Really, what's that got to do with Northern Rock? It wasn't interest rates that spooked their savers now was it. Also shows a fundamental misunderstanding of simple mathematics. “A sure fire way to cause a crash, is to predict it – I have to ask myself why the Bank of England and Nationwide are encouraging over-cooked pessimism?” Of course, talking a market up for the benefit of Assetz is all OK, but anything that would bring prices into the reach of first time buyers would be a bad thing. so why don't BoE and Nationwide talk the market up (to this extent)...because they don't want to lose their jobs, get banged up etc for blatantly lying about circumstances. They kind of expect to be around for a few years so trashing your reputation based on hopeful but flawed predictions is not a good idea. Now that is a TRUE VI article. Unsubstantiated bu**sh1t from beginning to end. Note that the Nationwide actually said: “The main reasons for this more subdued outlook lie on the demand side of the market, where a slowing economy, tighter credit conditions, stretched affordability for first-time buyers and lower house price expectations appear likely to reduce the level of activity.” You see Mssrs Newnes and Law, this is called reasoning. It may be flawed but at least it is stated and verifiable. It is not wishful thinking. Quote Link to comment Share on other sites More sharing options...
D'artagnan Posted November 17, 2007 Share Posted November 17, 2007 SLASHING RATES WILL STOP HOUSE PRICE CRASH"THE property boom will finally run out of steam next year as price rises stall but they will not crash as doom-mongers gave predicted. Britain’s biggest building society the Nationwide reported yesterday (fri) that while prices will slow across the country they will not drop dramatically. And a series of interest rate cuts in the New Year hinted at by the Bank of England could also kick start the market back into life. Other property experts last night dismissed previous pessimistic predictions and told homeowners they can expect prices to continue rising in the long term. Stuart Law, Chief Executive of Assetz, said: “The Nationwide, like most building societies, tends to significantly underestimate house price inflation at the beginning of each year. “Next year appears to be no different, with today’s prediction of 0 per cent. “In contrast, I would expect house prices to increase by five per cent in 2008.” David Newnes, managing director at Your Move estate agent, said: “Nationwide’s house price forecast for 2008 looks over-cautious. “Their forecasts don’t make enough of continued demand for property. “They also omit the potential for increased confidence through the interest rate cuts some have more recently predicted. “A buoyant property market depends on three things: strong demand, affordable interest rates and consumer confidence. “While confidence may have taken a hit after the Northern Rock fiasco, people still want to buy homes. Sustained demand together with hints of rate cuts as early as January next year, will surely help boost confidence. “Even now, interest rates remain way below the highs of years past and there’s no reason for panic. “A sure fire way to cause a crash, is to predict it – I have to ask myself why the Bank fo England and Nationwide are encouraging over-cooked pessimism?”.................." Why does this article make think of this ? [parental advisory - contains rude words] So now, even the Express think that a series of interest rate cuts are now required to stop a crash. Bad news guys, there will be no significant rate cuts (passed on to borrowers). This is it. Quote Link to comment Share on other sites More sharing options...
Dubai Posted November 17, 2007 Share Posted November 17, 2007 “Their forecasts don’t make enough of continued demand for property. " Demand as much as you like. If you don't have the cash, you don't get the goods. No money, no honey. Quote Link to comment Share on other sites More sharing options...
Lepista Posted November 17, 2007 Share Posted November 17, 2007 SLASHING RATES WILL STOP HOUSE PRICE CRASHOther property experts last night dismissed previous pessimistic predictions and told homeowners they can expect prices to continue rising in the long term. Taking aside the distinctly etheral "other", do house prices actually always increase in the long term? Looking at this graph (Thanks Cagiso!), with the (average) house prices defated according to (average) wages, we can see that it absolutely depends on where in the cycle you buy a house. in real terms, you might have bought a house in the peak of 1973, and it would still not have been "making money" until the turn of the millenium. OK, it's actual price has increased, for sure, but in REAL TERMS, the property has lost money. Why? Because, as an investment, there are far better things to do with your money than to have put it in property. "in it for the long term" - how many people realise that this might actually be 25 years??? OK, if it is your home, and the choice is that or renting, then the choice is easy - at the end of 25 years, you have the "asset" of a house in your pocket, and the renter has nothing. However, as a BTL, it is probably a horrendous investment choice. Also, looking at timing, when might be the best time to buy a home (note: home)? Now, at what is undoubtedly some sort of peak, or in a few years time, when prices have "rationalised" back to 3.5x earnings? I'll let you decide. Quote Link to comment Share on other sites More sharing options...
Sinking Feeling Posted November 17, 2007 Share Posted November 17, 2007 (edited) “The main reasons for this more subdued outlook lie on the demand side of the market, where a slowing economy, tighter credit conditions, stretched affordability for first-time buyers and lower house price expectations appear likely to reduce the level of activity.” Surely "tighter credit conditions" are a supply side issue! Edited November 17, 2007 by Sinking Feeling Quote Link to comment Share on other sites More sharing options...
DabHand Posted November 17, 2007 Share Posted November 17, 2007 He may as well be talking to a rock. People simply cannot afford for HPI to do anything other than stop. Doesnt matter if there's a billion people in the UK if NO-ONE has been getting the wage inflation required to sustain it. Given much of recent HPI has been multiplied up from speculative leverage of existing equity under lax credit conditions it really isnt going to stay at 0% either. But that is another argument. Quote Link to comment Share on other sites More sharing options...
needle Posted November 17, 2007 Share Posted November 17, 2007 MI6 Killed Diana because she wanted rates to fall! Quote Link to comment Share on other sites More sharing options...
Guest pioneer31 Posted November 17, 2007 Share Posted November 17, 2007 Same old misunderstanding of fundamentals - demand etc. No mention of credit crunch. I've just wasted 2 minutes of my life reading that s**t. Quote Link to comment Share on other sites More sharing options...
Guest wrongmove Posted November 17, 2007 Share Posted November 17, 2007 I've just wasted 2 minutes of my life reading that s**t. Sorry about that! The clue was in the title though: "says The Express". I have to say, I found the frantic and inane ranting in the article very reassuring, especially as they were actually arguing against a building society. As in the track I linked to - "sh1t outta luck"! Quote Link to comment Share on other sites More sharing options...
A Fool & His Borrowed Money Posted November 17, 2007 Share Posted November 17, 2007 “Their forecasts don’t make enough of continued demand for property. "Demand as much as you like. If you don't have the cash, you don't get the goods. No money, no honey. Cracker!, that's going in my sig Quote Link to comment Share on other sites More sharing options...
CrashedOutAndBurned Posted November 17, 2007 Share Posted November 17, 2007 Hefty rate cuts in the USA certainly averted house price falls and even the currency escaped unscathed. Oh, wait... Quote Link to comment Share on other sites More sharing options...
ianbeale Posted November 17, 2007 Share Posted November 17, 2007 Hefty rate cuts in the USA certainly averted house price falls and even the currency escaped unscathed. Oh, wait... you forgot to mention that inflation has stayed down...taxi Quote Link to comment Share on other sites More sharing options...
theblacksheeple Posted November 17, 2007 Share Posted November 17, 2007 Just reading the title "slashing rates with stop house price crash says the express" makes me think hmmmmmm therefore this must be true Is this how desperate the bull argument has got,,, relying on the daily Diana Crash now 100% on Muds poisons hatchings out of, VI interests Quote Link to comment Share on other sites More sharing options...
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