Jump to content
House Price Crash Forum
Sign in to follow this  
Guest muttley

U K House Prices Drop For Fourth Straight Month

Recommended Posts

Guest muttley

UK house prices drop for fourth straight month

Fionnuala Earley, Nationwide's Chief Economist, said that while the house price inflation in recent times was clearly over, the UK housing market was unlikely to follow the US, where house prices fell 10pc in 2007.

They're still trying to talk the market up at the Nationwide.

Fionnuala? :unsure:

Share this post


Link to post
Share on other sites
UK house prices drop for fourth straight month

They're still trying to talk the market up at the Nationwide.

Fionnuala? :unsure:

Fifi may be right. I also do not think we will follow the US HPC. Their HPI over the last decade was around 120% overall. Ours was closer to 300%. Thus, we have much further to fall.

BTW, house prices fell 17% in Southern California in 2007 and by as much as 30% in some zip codes where repos are heavy. California is the lead state for the HPC and where it all began both this time and during the Great Crash of '89. We tend to follow the Calfirona pattern of boom and bust:

http://www.housepricecrash.co.uk/forum/ind...ost&id=4113

Share this post


Link to post
Share on other sites
RB,

As you say, massive overvaluation in the UK, far higher than the US.

809.jpg

Crikey - that graph is very informative. we really do have along way to fall. YYYYEEEEEEESSSSSSSSSSS!!!!

Share this post


Link to post
Share on other sites
Crikey - that graph is very informative. we really do have along way to fall. YYYYEEEEEEESSSSSSSSSSS!!!!

Blimey, it looks as though that graph should drop to 90. Yikes.

Still part crash part inflation, should be back to its old heights in 2050. :(

Share this post


Link to post
Share on other sites
Blimey, it looks as though that graph should drop to 90. Yikes.

Still part crash part inflation, should be back to its old heights in 2050. :(

Bubble markets overshoot, both ways. 90 would be lucky. Looks like the US have every chance fo overshooting to the downside this time around like we did in the nineties.

Share this post


Link to post
Share on other sites
Bubble markets overshoot, both ways. 90 would be lucky. Looks like the US have every chance fo overshooting to the downside this time around like we did in the nineties.

Sorry I was foolishly looking at the US trendline.

But at least there won't be a recession to make it worse. :lol:

Share this post


Link to post
Share on other sites
RB,

As you say, massive overvaluation in the UK, far higher than the US.

809.jpg

Great chart OnlyMe!

Wow, I didn't think it was THAT bad! When you see it graphed the enormity of Gordon's folly hits home.

Share this post


Link to post
Share on other sites
Doctor , from where did you cut and paste that chartCan you please provide a link, one of the best charts i have seen

:lol: He copied it from the poster above him "Only Me "

Cracking chart though .

Share this post


Link to post
Share on other sites
RB,

As you say, massive overvaluation in the UK, far higher than the US.

809.jpg

Very interesting chart. Funny (well, not really) how the UK follows the peaks and troughs of the US but the fluctuations are significantly wider.

Regards,

Q

Share this post


Link to post
Share on other sites

The Nationwide's "First Time Buyer Gross House Price to Earnings Ratios" tells pretty much the same story.

FTB price/earnings ratio needs to fall 40% to return to the long term mean and with overshoot ... by 60% to bottom at the nadir after the last boom.

ftb_p_e.jpg

post-10565-1204280520_thumb.jpg

Share this post


Link to post
Share on other sites
RB,

As you say, massive overvaluation in the UK, far higher than the US.

809.jpg

That chart looks like what's descibed here.

How to avoid market bubbles

What happened after 2005, especially in London

Valuations climb well beyond historic norms, and logic and reason take a back seat to greed. While the late majority are getting in, the smart money and insiders are unloading. But as prices begin to level off, or as the rise slows down, those laggards who have been sitting on the sidelines see this as a buying opportunity and jump in en masse.

Prices make one last parabolic move, known in technical analysis as a selling climax, when the largest gains in the shortest periods often occur. But the cycle is nearing the top of the bubble. Sentiment moves from neutral to bullish to downright euphoric during this phase.

I like this analogy

The fourth and final phase in the cycle is the most painful for those who still hold positions. Many hang on because their investment has fallen below what they paid for it, behaving like the pirate who falls overboard clutching a bar of gold, refusing to let go in the vain hope of being rescued.

Share this post


Link to post
Share on other sites

She said: "There is currently an unprecedented amount of uncertainty about future economic conditions, but if the Bank of England's central projection that the economy continues to grow is correct, conditions for the UK housing market are perhaps less gloomy than some would have us believe.

'IF it is correct' ???

What can she surely mean?

Share this post


Link to post
Share on other sites
Fionnuala Earley, Nationwide's Chief Economist, said that while the house price inflation in recent times was clearly over, the UK housing market was unlikely to follow the US, where house prices fell 10pc in 2007. there was still a danger that hard-working young couples may soon be able to get their filthy hands on property.

Share this post


Link to post
Share on other sites
Nice.

But I think an 85% fall in nominals might be pushing expectations, even for me.

Agree, the comments and annotation are more interesting than the figures.

Mind you in exceptional circumstances in this country there has been property that you couldn't give away before being bid up to more normal (but bubble) market prices. Some of those could easily return to totally unwanted status.

Share this post


Link to post
Share on other sites
Crikey - that graph is very informative. we really do have along way to fall. YYYYEEEEEEESSSSSSSSSSS!!!!

Or a long way for wages to catch up. Where's Goldfinger with his broken record player stuck on "inflation here we come"?

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 295 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.