Saturday, January 12, 2008

Encouraging news for home owners…yawn

ITAIN’S HOUSES ARE NOW WORTH £4TRILLION AS PRICES RISE 9% IN JUST ONE YEAR

''British home owners are sitting on a property goldmine worth £4trillion.'' ''But Martin Ellis, chief economist at Halifax, said: “Home owners are building up lots of equity in their properties, which is providing a very good cushion for when the market gets more difficult.” Shame when things get more difficult, the homes won't be worth much!!!!!

Posted by hpwatcher @ 06:35 AM (1604 views)
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19 thoughts on “Encouraging news for home owners…yawn

  • A big problem for the UK is so much equity is tied up in the houses and there are few savings in the bank. An associated problem is that so much money is owed in debt for this nation. When a downturn appears, few have liquid resources and are prepared for it.

    There is little or no flexibility as houses can’t be sold and bought quickly and easily to access funds when needed. If you want to draw that pension you need to sell that house!

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  • they mayt be worth 4 trillion but I’ll bet the mortgages are worth at least two

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  • Cheekie Charlie says:

    I see the Times have stooped to this level of VI spin this morning as well. This has to be the most concerted and desperate to date lets hope its one of the last.

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  • it doesnt matter what they are worth, people are no richer really, unless they sell and live in a tent…………..

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  • My reply to a previous posting on Wednesday 9th Jan by nopensionnohouse

    28th December 2007 Daily Express headline HOUSE PRICES FALL AGAIN

    29th December 2007 Daily Express headline HOUSE PRICES RISING AGAIN

    1st January 2008 Daily Express headline HOUSE PRICES PREDICTED TO FALL

    9th January 2008 Daily Express headline HOUSE PRICES UP 5.2%

    Friday 11th January 2008 Daily Express headline (after base rate reduction) HOUSE PRICES NOW SET TO ROCKET IN 2008

    Well I wasnt too far off the mark in general terms with my prediction – I think we all now have the measure of the Express headlines – by the middle of next week after a bit of bad news on trade deficits, a further slide in Sterling, FTSE 100 below 6000 and a few more major job losses the headline will be reading “House prices set to fall unless BOE takes decisive action to cut rates in February” – LOL

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  • Sold My Soul To The Never Never Never says:

    Did Martin Ellis really say this? Remember the Edinburgh Evening Post on 10.01.08! There is an ominous desperation in this market now.

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  • Mortgage debt is £1.1 Trillion so only 25% of the value of the houses if the report is right….

    But what’s more concerning is personal debt is £1.4 Trillion….. some sleepless nights in there for sure!!

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  • george monsoon says:

    Jack c (lol on the name!)

    you are bang on the nail. So many media sources are controlled by V.I.s or are politically biased.
    for this reason, they are so predictable. I don’t read newspapers anymore. I get my information from other sources that are at least objective and unbiased, even if they are sometimes inaccurate.

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  • Yeh right – £4 trillion assuming that they could all be sold at full price, all sold at the top of the market & they could all be sold instantly – big assumptions!
    I see it as £4 trillion less a way overdue 60% fall of £2.4 trillion = £1.6 trillion . Then take off £1.4 trillion of debt = £0.2 trillion. Also with £93bn of interest payments each year Brtain probably has a big fat ZERO equity – not a ‘goldmine’.

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  • These guys need help with both Propoganda and Economics.
    First Propoganda
    [1] Put it on your front page instead of yet another Madeline story
    [2] Avoid contradictory headlines stating House Prices have risen 5.2% then try and tell us its 9% the next day.
    Second Economics
    [1] Avoid nonsence statements like homeowners have built up a lot of equity to cushion them in the tougher markets well possoms if the market turns the equity also tanks!!!!

    Jack you are spot on with this publication actually they are no longer being taken seriously I think even the luvies in the media are making fun of endless House Price headlines. Hence why I think this propoganda was not on the front page as a headline, even though I thought it would be….

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  • Its going to be difficult to call it a goldmine in a few months if the pound continues to fall, as even if the properties stay at these ridiculous prices and can be sold, the pound exchange and inflation will make them worth next to nothing. I am so proud to call myself English.

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  • Tiggerthetiger says:

    And there is more good news for householders – the experts think prices will keep rising this year, but at a reduced rate.

    Which experts would these be then ?
    Such drivel

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  • Goldmine?! Most Britains are sitting on an illiquid asset which is costing them a fortune a month to maintain, the costs are increasing at much faster than the rate of inflation, the value of the asset is starting to slip dramatically, most people can’t afford to purchase their asset from them and even if they could the ‘goldmine’ owner can’t afford to purchase anywhere else. That’s not a goldmine, it’s a millstone.

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  • That’s a very good point; the houses could be worth 50 trillion….but unless the value can be unlocked, they aren’t really worth anything.

    As we move more and more to the inevitable recession, I expect, the headlines to become more & more hysterical.

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  • Common problems with goldmines include rich seams drying up, prop failure, overheating leading to fires, flooding, and of course sudden and unpredictable drops is asset prices.

    Just like a house.

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  • planning4acrash says:

    Except that 4trillion is worth 5% less as Sterling slides. Did anybody see that France’s economy has now overtaken Britain’s in size due to the slide in Sterling?! No surprise really, they are investing in TGV’s all over the place, support their industry, achieve productivity through workers rights (anything over 35hrs a week is just staring blankly at a computer screen waiting for a pay check in my view). I would brush up on your French, Chinese and German if you want to do well in the next decade!

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  • it_is_going_with_a_bang says:

    So who cares what the total is worth – this total does not reflect equity does it?
    On an individual basis this news is fairly worthless. I may have a 350k house and a 200k mortgage. But if I can’t afford the 200k mortgage then what does it matter that its worth 350k? I would still have to sell it.

    It’s about affordability of day to day life not what your house is potentially worth. It is exactly this kind of ‘look how much your house is worth’ talk that has got so many people in debt they can’t afford.

    And what is a potential buyer ? someone who rings up and asks about a house thats advertised. Reports of ‘this’ and ‘that’ are meaningless. IMHO the agents are saying it to try and ‘make’ people think they have to make offers etc etc. It could well just be a sales tactic to try and save their ar5es.

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  • Say_it_isnt_so says:

    Debt is real.

    The value of an asset is only what someone is prepared to pay for it.

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  • Ahh, Ellis still applying lipstick to dogs.

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