Monday, December 3, 2007

Prime London properties losing £5,500 per month

London house prices fall by £22K since August

The volume of prime London property for sale rises to record levels in October, up 54.6% on last year and up 12.9% on last month (looks like the sheeple have started panicking). Average prime London property prices fall for the third consecutive month, down 0.8%, wiping over £22,000 off the average sale price of a prime London home since August 2007. ***** Now if that continues, we are looking at nearly £70,000 over the year - pretty much wipes out the "£1,600 per month rise" the press were bleating about last year. Ahhh - it's nice to be proved right. Sit back and enjoy the ride people.

Posted by uncle chris @ 08:33 PM (1088 views)
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15 thoughts on “Prime London properties losing £5,500 per month

  • Good article, and I think the first of many.

    One key factor people I think underestimate about this upcoming crash: In 1988 internet sites like this didn’t exist. Somethings don’t change – I don’t see many articles talking property crisis in the traditional print and TV media. These are really only on the internet – maybe the odd one on News at Ten when it’s impossible to keep them under cover. With a lot more people a lot more savvy today, there’s no way you can say “we didn’t realise until it was too late”. So when the crash happens (and it is already), it will be a LOT quicker in its descent.

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  • converted lurker says:

    growler I’d agree, I reckon it’s impossible for govts., given how discredited they are, to bury bad news for long. They can only elevate or invent other issues in an attempt to keep real news of the radar. However, with an issue as personal as house prices, there is no hiding. The spread of the NR ‘panic’ or rather reasonable action given the reality, proved just how quickly news travels and how difficult it is to contain. Primelocation deserve a clap for how consistently honest they’ve been, those with the most to lose will sell up quickest. The notion that folk will sit out a daily drops in values is absurd. If it’s your home fair enough, however according to my research there’s far too many that have ‘rolled the dice’ that extra time and have no option but to sell once prices fall back. That’s proven by the P.Loc survey, a 56% increase in property for sale in London and yet sales not moving!! jeez!! P.S. hope you like the image on F-rung, a demented bull taking a running jump ;¬)

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  • It’s incredible the way the situation is shaping up.

    As Converted Lurker suggests the NR crisis is very interesting, we can only guess how much impact the ‘internet age’ had on that issue. Something else that I found interesting from that was the fact that the British public totally stunned the Government and ‘establishment’ by ignoring the initial comments from Darling and NR that there was nothing to worry about and continued the run on the bank regardless. It really is going to be different this time, mainly because it’s different everytime and the factors at play are always different.

    I wonder how many people have simply done the same as me, entered ‘house price crash’ into a search engine, found this site immediately and discovered many people (wisely) discussing an entirely different reality to the one fed to us by the mainstream media?

    It’s interesting how quickly things are moving these days (e.g. the queues at Northern Rock out of thin air). I’ve noticed recently reading the ‘News Blog’ items on this site that in a matter of a couple of weeks we’ve almost left the ‘there is no sub-prime in the UK’ articles behind and we’re already moving into the ‘how bad will the crash be’ articles!

    I’ve said on here many times that I think any HPC that we encounter in the UK in the next couple of years could re-write the history books in terms of rate of crash and overall impact and I’m not seeing anything to change that opinion. The UK has been fattened for slaughter to absolute perfection and already some of the figures being released (drop in mortgage products etc) are huge. Once the slowdown gains real momentum in 2008 I can see the housing market falling off a cliff and lord knows what it’s going to take with it.

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  • planning4acrash says:

    Sorry Growler, I disagree. I don’t believe consumers (home buyers) have any control over prices. I believe that sentiment only meaningfully affects top bankers and the decisions banks make about how much they are willing to lend to each other and how much risk they are willing to take when lending to mortgagee’s. Consumer sentiment follows banker sentiment with a time lag, but consumers seem to have the illusion that they make the decisions. It is easy to see that sentiment in the banking industry changed right about January when inflation hit 3%. From then on builder’s stocks and exposed bank stocks began a slow but steady decline. Many forget that Northern Rock had lost half of its value between Jan and when the crisis became mainstream. By that time large instututions had pulled away or shorted the stock already, by the time joe-six-pack got panicked.

    The real news now is that mortgage approvals are down, that does not mean that people aren’t still asking for mortgages, they are asking but not being given. The bankers are in control. We are just pawns in the money making game that is capitalism.

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  • planning4acrash says:

    You can only win if you can read the signs and follow the bankers to safe havens and high yield at the appropriate time, ensuring that you don’t hold out in a boom for too long. Like, the time to short UK housing was definitely November 06 to January 07.

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  • planning4acrash says:

    If If you put on the market in January you could sell before June if price and expectations reasonable, housing is a toughy to get right, miss the boat and well, you’ve missed the boat.

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  • @planning4crash

    “Sorry Growler, I disagree. I don’t believe consumers (home buyers) have any control over prices …”

    I’d just like to throw in my $0.02 here. My understanding is that in recent times, we have tried to develop methods of preventing stock market volatility caused by computerised tracking systems.

    http://query.nytimes.com/gst/fullpage.html?res=950DE4DF173EF930A35752C1A96F948260

    Some also blame computer trading systems for Black Monday

    http://en.wikipedia.org/wiki/Black_Monday_(1987)

    To me, it seems that Growler’s basic idea is not so bad: if enough people become aware at the same time that there is a problem then a tipping point might be reached.

    Whether there are enough people reading blogs like this to make a difference is enough matter though.

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  • Cristiano Barbaro says:

    P4C in post 4 above is correct. The sheeple don’t control anything, the bankers do. However this time around the bankers have taken on so much bad debt and are so overstretched themselves that it will be a very interesting, but frightening thing to see how things play out. This is a world systemic issue, it’s not a subprime issue. Subprime was the trigger, not the problem. Of course, my job relies on the real physical economy to keep afloat has me very worried indeed. I sell stone processing machinery to countries such as India and Brazil, as well as the rest of the world. And being there a construction crisis (to say the least!) it has me thinking every day about possible career changes into other segments of the economy such as energy (even on a basic level such as selling fire wood, wood stoves and accessories). Then on the other hand I think, ok, let’s work harder on increasing sales in Russia and the far East, their economies are pulling, and may counterbalance the fall in the West… but I know that it’s wishful thinking.
    Truth is until our Western leaders make a real decision to invest into the physical economy, and into productive processes, the sooner things will improve for all. All CDO’s, derivatives and other such frauds, are part of a non producing paper economy which is showing its true worth now as we speak. Of course with the firing of thousands of jobs and downsizing in the financial sectors in Western countries, it will have a real net effect on the physical economy too. Too many games have been played, and too little work has been done by the baby boomers.

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  • David Smith's Sub Prime. . . says:

    Nonsense!

    There is no Sub Prime

    Love David Smith aged 13 and a quarter…

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  • Yes Wiltshire, I too put a search out for HPC in 2004 because I wouldn’t be part of the housepricescanonlygoup school of thought (or complete lack of it). It has been a long and frustrating ride, but now, if it’s true that London prices are definetly coming down, we should start planning for The Party. I recon in |June you won’t have to rent a venue, we’ll just chip in and buy one!

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  • voiceofreason says:

    A 54.6% increase in properties for sale really does make a mockery of all the dingo’s kidneys spouted by the vested interests about lack of supply keeping prices up, so we need to build 3m more homes. And the old “In it for the long term” one.

    Also, the last sentence:
    “Over the coming months, we expect prices to remain relatively flat, with little or no price growth likely for the remainder of 2007.”
    How ?

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  • i think a for sale rise of 54.6% just goes to show how many investors have been hording properties
    last year the media said there were around 800000 empty properties in britton i reckon its more like 1.5 m (btl offplan)
    and once they start to hit the market prices will really start to tumble
    so much for supply and demand , immigration, divorce and all the other stupid stupid arguments

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  • 54.6% increase of properties for sale year on year.

    Yep, that’s a soft landing.

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  • EA’s know from experience that a higher percentage of homes brought onto the market at this time of the year are in need of a quick sale. So you can safely say that there is nervousness out there. I for one would not want to be an owner of a property in London right now because the losses are not 4 figures they are 5 & 6 figure sums. Ouch!

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  • It’s a confidence thing as well. Whilst I could afford a house, I’m not confident in the slightest. More people are seeing this – thanks to this and other more objective sources. People are realising that prices are hype – and those that don’t, are seeing the pain of their excesses in borrowing. The steeper the supply curve is on the way up, the quicker it is down. As someone said – sit back and observe.

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