February 2008 Archive

Friday, February 29, 2008

Price of stuff and houses in the past

HBOS Plc: GENERAL ELECTIONS AND HOUSE PRICES

Doc showing the average cost of things including houses, bread etc when various Governments were elected and during their reign. The not so interesting John Major did a very good job of keep bread prices under control, a loaf rising by 1p from 51p to 52p during his tenure. House prices also fell for the first 4 years he was in power, having also fallen in the last year of Mrs Thatcher. In the same year Major took power (1990) beer was only 1.14 a pint. The real Champion house price demolition expert was Harold Wilson. In real terms, he knocked 13% off house prices, and although the nominal increase was 7% at a time when wages were going up at 20%. This time wages are not going up anything like that, so expect nominal falls -ie prices lower without accounting for inflation.

Posted by mikelivingston @ 11:05 PM 0 Comments

A reminder of how long it took to recover from the last crash!

Independent, The (London), Apr 23, 1995: Sellers Loosen Grip of negative equity

I have been doing a historic web search for old web articles on the last crash. My first recollection of the internet was about 1991 and I can't find anything going back that far as the web was still Geek toy then and estate agents and their media friends hadn't worked out how to use it at that stage. But I did find this nice article from 1995 reciting the history of the previous crash. Last time it took sellers 5 years to escape the negative equity trap, this time it will be longer because the boom was longer

Posted by mikelivingston @ 10:42 PM 0 Comments

Rightmove isn't a VI after all

FT: Rightmove benefits from slowing housing market

Would you believe it ?
"The property sales portal is paid by advertisers on a subscription basis per month, which means that the longer new-build property stays unsold and on its website, the more it earns."
"....revenue rose 69 per cent ..."

Posted by voiceofreason @ 09:16 PM 6 Comments

BTL gone! House prices gone! It is the curse of the "fiinnannciall llleevveragge"

Times: Buyers who do not have 10% deposits are left out in the cold

You remember those BTL i@iots repeating the mantra "the power of the fiinnannciall llleevveragge" AAHHHAHAH now it is the curse!! Divide a large number by a small number, what you get is a mess! Prices will fall like leaves in autumn!

Posted by confused76 @ 06:40 PM 4 Comments

Printing dollars till there are no trees left

Times: Quantum's Jim Rogers says US 'out of control'

Investment biker Jim Rogers says America is completely out of control, there will be a 20-year bull market in commodities, and that prices will be in turmoil. "In a blistering attack on US monetary policy and the helicopter cash drop responses of the Federal Reserve, Mr Rogers described the American dollar as a terribly flawed currency...The dollar may have declined recently, he added, but you aint seen nothing yet. Gold would continue to rise, the analyst Christopher Wood told fund managers, because it is the exact opposite of a structured finance product." recons it will go to $3,500

Posted by happyrenterz @ 06:24 PM 11 Comments

More & more....

Telegraph: US stocks fall as credit 'cancer' fears grow

''Insurance giant AIG was among the hardest hit after revealing its biggest-ever quarterly loss as a public company after taking an $11.12bn (5.63bn) write-down on investments linked to US sub-prime mortgages. Those fears were exacerbated after analysts at UBS estimated that losses in the credit markets may soar to $600bn from $160bn.''

Posted by hpwatcher @ 06:06 PM 1 Comments

Inflation rise hits US customers

BBC News: Inflation rise hits US customers

US consumer spending rose more than expected in January, but much of the gain was down to rising prices. The Commerce Department said personal spending rose 0.4% last month, a bigger rise than economists were expecting. But the report showed that a key gauge of inflation rose 0.4%, with shoppers spending more on food and fuel.

Posted by welshie @ 05:44 PM 0 Comments

Gold, Silver and Platinum Prices Surging in Pounds Sterling (GBP)

Safe Haven: Gold Investments Market Update

Interesting article on Safe Haven regarding the precious metal markets and there is a chart showing the surging price of gold in GBP. Showing that gold's strength is not just a function of dollar weakness as some would have you believe. The FT reported today that Barclays said "Commodity prices are going up in all currencies. Supply losses, strong demand and low inventory levels are the key drivers, not exchange rates." Gold and precious metals are the primary asset class that will protect rich and poor in the coming years.

Posted by gold silver @ 03:02 PM 4 Comments

What if? Eureka Moment

vnunet.com: Internet facing 'meltdown' by 2010

Being privilieged to visit the HPC website. It has taught me a lot, opened my eyes to many things. Being able to read various views in relation to house market conditions and all the relative evidence to support various points of view. The reason for this submission, was due to reading opinions expressed on HPC. And by pure chance, a simple conversation, the answer to a question was glearingly obvious. What if the consumer using the expanded data volumes (excessive MB's) and as a consequence intentional or otherwise. Imagine switching on your PC, to find that you & everyone could not connect to the world wide web. It would be instantanious, and would effect all, a short period of darkness would descend, this situation is in my view very real.

Posted by stevie dee @ 02:32 PM 12 Comments

If you lose money selling couches and chairs, how can you pay your investors a hefty dividend? You play the markets.

CNN: Furniture company - or hedge fund?

Now we have DFS, CSL and Land of Leather in the UK who are so reliant on the housing market. I wonder how this will play out....?

Posted by lvmreader @ 01:26 PM 5 Comments

Mortgage approvals Jan 2008 represent a 40% decline compared with January 2007

Citywire: Mortgage lending at same level as 1995, Bank of England says

Mortgage lending picked up by 2.7% in January but the number of approvals is at the same level as September 1995, according to the Bank of England. Approvals for house purchase mortgages rose to 74,000 in January from 72,000 in December, but are still close to historic lows of 71,000 approvals in May 1995. The 74,000 approvals granted to home buyers during the month still remains close to historic lows and represents a 40% decline compared with January a year ago,

Posted by jack c @ 01:23 PM 1 Comments

BTL, you are doomed: your LTV is cut to 75%

MoneyMarketing: When the going gets tough

"Woolwich announce it will be cutting buy to let loan to values to 75 per cent. In an email to brokers, the lender says it was to withdraw its 85 per cent LTV BTL. range so that is can effectively manage the flow of business it has received" This means an immediate drop of 40% in the house price (just do 100/85% compared to 100/75%) what a crash AAHHAH AHHAHAAHA AHHAH reported by a broker so situation must be worse AHAHH AHHAHHAH

Posted by confused76 @ 11:56 AM 17 Comments

Bye bye buy to let!! BTLetter goes belly up

icWales: Tenants at risk after collapse of buy-to-let firm

AHHA HHA HAHAHHAHHA. I m preparing to laugh very hard at the increasingly common stories of failed BTL ventures. From BBC: "A & A Property has been by hit by serious financial difficulties and administrator Grant Thornton has been called in. Michael Jones, director of the Michael Jones Estate Agents in Cardiff, said the news came as no surprise. "People who've bought at the top of the market and suddenly find that prices are falling, and of course there is a hole in their funding and the banks are starting to get very nervous about it" banks are getting nervous AHAHAH HAHHAH

Posted by confused76 @ 11:48 AM 21 Comments

Are we seeing the return of stagflation?

MoneyWeek: Are we seeing the return of stagflation?

Forget the recession debate the question now is 'how hard the landing will be'. And given the latest miserable data from the US, its hard to disagree.

Posted by damien @ 11:16 AM 1 Comments

Hedge Fund Fire Sale!

FT: Peloton Partners in $2bn assets sale

It is the classic story of when leverage goes wrong, one investor said. But I cant believe this problem is confined to these guys alone. No I can't either. This WAS one of London's most successful funds, which only LAST MONTH was named 'best new fixed income hedge fund'.

Posted by doom&gloom @ 11:03 AM 2 Comments

London hedge funds at risk

BBC News: Credit crisis claims hedge fund

A London-based hedge fund has become the latest victim of the credit crisis after Peloton Partners began shutting a $2bn (1bn) fund due to severe losses. Peloton's fund, known as ABS Master Fund, had bet that sub-prime mortgages would decline in value and instead had focused on better quality US home loans. But these investments have also become tainted by the problems in the sub-prime market, resulting in a steep decline in their value.

Posted by mken @ 09:53 AM 0 Comments

Why banks may regret hiking their dividends

MoneyWeek: Why banks may regret hiking their dividends

Royal Bank of Scotland has hiked its dividend, just to prove it still can. But with the future of the mortgage market far from certain, that might be something it comes to regret at a later date

Posted by damien @ 09:27 AM 1 Comments

Higher inflation just around the corner

Independent: Inflation makes an unwelcome return

(See 3rd section of this article.) Interesting analysis of factors pointing to higher prices: "This sort of inflation is likely to prove sustained and must eventually result in higher wage demands." Looks like the core inflation index is going to have to exclude more of these pesky volatile items.

Posted by letthemfall @ 09:06 AM 0 Comments

CDS $45.5 Trillion versus Stock Market $21.9 Trillion.. theres only one way to find out....FIGHT

Seeking Alpha: A Misleading Chart on Credit Default Swaps

Apologies to Harry Hill! This is about the graphics that were posted onto this site earlier this month. This jorno basically says that the CDS values are not as big because they are notional amounts not actual. A Corrorally is the S&P futures and the stock market. The stockmarket is the actual physical value of the shares were traders trade the S&P based on $250 thimes the index (used to be $500 times the index) - so the notional value of contracts traded is huge. Hes comparing the CDS value used of $45m - in effect with the notional value of the S&P futures (at least thats what i think he's saying!!).

Posted by techieman @ 08:53 AM 4 Comments

Well if BoE say it, then it must be right...

Telegraph: UK house prices drop for fourth straight month

''..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...''

Posted by hpwatcher @ 08:04 AM 16 Comments

From the horse's mouth

Nationwide [pdf]: Prices -0.5% in Feb, annual rate now just +2.7%

I'm sure there'll be a zillion articles posted on these same set of figures, but here it it straight from the source. In Feb, prices fell for the 4th month in a row, by 0.5%. The average house price fell by 38 per day in Feb. The annual rate of HPI is now less than even the official govt inflation measure, at just 2.7%. The average price was 186,723 in October, but is now just 179,358.

Posted by little professor @ 07:21 AM 19 Comments

This guy is looking at 3 March for an intermediate top

Market Oracle: Gold Accelerating Towards Blow off Top

Current price of GLD is 95.99. He sees the top of the channel as 96.5

Posted by sold 2 rent 1 @ 06:51 AM 10 Comments

The real cost of war

The Telegraph: Stiglitz: $3tn Iraq legacy to hit next President

In 16-years time, the US will face a $4bn annual bill for disabled servicemen, said Mr Stiglitz, who estimated that around 40pc of the 2m currently fighting in Iraq will return home severely disabled.

Posted by sold 2 rent 1 @ 06:45 AM 3 Comments

There She Blows

BBC News: Property prices fall in February 0.5%

The fourth consecutive monthly fall in property prices puts the cost of the average UK home at 179,358.

Posted by wdbeast @ 05:50 AM 8 Comments

IS this the end of small buy to let investors?

BBC News: Branded build-to-let plan on show

There is an "insatiable demand" for rented property in London from residents in the 20,000 to 50,000 wage bracket, the group says. It wants incentives for large companies to enter the residential rental market and build-up a recognised brands. I hope this will make all the small buy to let investors packing!!

Posted by ram @ 05:30 AM 3 Comments

A $3 Trillion Black Hole Sucking Us All In.

The Australian: Iraq war 'caused slowdown in the US'

HE Iraq war has cost the US 50-60 times more than the Bush administration predicted and was a central cause of the sub-prime banking crisis threatening the world economy, according to Nobel Prize-winning economist Joseph Stiglitz. The former World Bank vice-president yesterday said the war had, so far, cost the US something like $US3trillion ($3.3 trillion) compared with the $US50-$US60-billion predicted in 2003. Australia also faced a real bill much greater than the $2.2billion in military spending reported last week by Australian Defence Force chief Angus Houston, Professor Stiglitz said, pointing to higher oil prices and other indirect costs of the wars.

Posted by yt1 @ 05:18 AM 0 Comments

Thursday, February 28, 2008

The US economy faces more trouble and the President is out of touch

Huffington Post: Bush On $4 Gas: "I Hadn't Heard That"

In the US, petrol prices are predicted to reach $4 a gallon this spring. The increases could not come at a worse time for the economy. With growth slowing, energy increases that were once easily absorbed by consumers are now more likely to act as a drag on household budgets, leaving people with less money to spend elsewhere. These costs could worsen the nation's economic woes, piling a fresh energy shock on top of the turmoil in credit and housing. When quizzed at a press conference, Bush responded: "$4 gasoline? That's interesting. I hadn't heard about that." --- Is this a 1970s-style oil shock being played out in slow motion? Or peak oil? Either way it can only lead to one thing: recession.

Posted by drewster @ 11:28 PM 0 Comments

Report your landlord to the taxman!

Times: Tax crackdown on landlords

Tough times for landlords.. AHA H AHA HAHAH HAHHA HA. Just reported mine to the IR, anonymously of course. Hope they find some problems with his tax return, who does not have issues with the taxman?!?

Posted by confused76 @ 09:37 PM 9 Comments

The Bricks Chicks!

Times: Soaring inflation, Russia and Kazakhstan

Council tax and water bills grow at double the inflation, and "wish we could be more upbeat about the house prices, but unfortunately these are growing below inflation". "The money Brits spent on overseas property grew by 229% last year" This is a sick country!

Posted by confused76 @ 09:26 PM 1 Comments

How much do you think this would sell for?

CNN: Filthy house beyond hope

Just watch it.

Posted by little professor @ 07:18 PM 5 Comments

S&P - "Borrowers face an increase in mortgage payments"

Mortgagestrategy: Still no end in sight to credit meltdown

Ratings agency Standards & Poors warns there's still no end in sight to the UK's credit meltdown and that it expects life to get harder for sub-prime borrowers in 2008. With falling house prices and a widening disclocation between LIBOR and the Bank base rate, it says UK borrowers are currently in a much tougher credit environment.

Posted by jack c @ 06:44 PM 1 Comments

Bush 'Sadam has WMD'...

Times: Bush says no recession, Wall Street disagrees

''Wall Street yesterday derided President Bush for insisting that America had not fallen into a recession just as Washington published appalling economic growth and jobless numbers.''

Posted by hpwatcher @ 06:41 PM 5 Comments

'fessing up

CNBC: Bernanke's Bank Comment Rattles Stocks

"I expect there will be some failures''

Posted by alan @ 04:49 PM 17 Comments

I would like to say unbelievable, but.......

Telegraph: Northern Rock bought rugby fields three weeks before crisis

Northern Rock bought the grounds of Newcastle Falcons rugby club for almost 15m three weeks before the bank had to appeal to the Bank of England for an emergency loan. The transaction has come to light because it was recorded in the accounts of the Falcons, which sold its grounds at Kingston Park to Northern Rock on August 17 after struggling to meet its mortgage repayments to the bank. It has been seized on by critics as more evidence of the bank's increasingly desperate acts to bolster its 2007 results. The transaction - said by analysts to have been at a high price - may also raise eyebrows among the bank's investors, who face getting nothing now Northern Rock has been nationalised, and the Government, which is liable for any losses the bank incurs.

Posted by lvmreader @ 03:31 PM 4 Comments

You've got to admire his persistence (if nothing else).

Associated Press: Bush: US is not headed into recession

WASHINGTON (AP) -- President Bush said Thursday that the country is not headed into a recession and, despite expressing concern about slowing economic growth, rejected for now any additional stimulus efforts. "We've acted robustly," he said. "We'll see the effects of this pro-growth package," Bush told reporters at a White House news conference. "I know there's a lot of, here in Washington people are trying to - stimulus package two - and all that stuff. Why don't we let stimulus package one, which seemed like a good idea at the time, have a chance to kick in?" Bush's view of the economy was decidedly rosier than that of many economists, who say the country is nearing recession territory or may already be there.

Posted by yt1 @ 02:57 PM 0 Comments

Strong fundamentals, record employment, low inflation and an end to boom & bust !

Sky News: 12,000 Jobs Cut In Work And Pensions

Massive job cuts have been announced at the Department for Work and Pensions - with some 12,000 positions to be axed over the next three years.The news came just hours after the department signalled a bigger role for the private and voluntary sectors in helping people find work.Work and Pensions Secretary James Purnell said he wanted a "step change" in the benefits system, giving the private and voluntary sectors more freedom. Unions had already expressed concern the move could lead to job losses among DWP staff.

Posted by jack c @ 02:56 PM 6 Comments

Sales down again....

tIMES: House sales down by a fifth

''...The number of houses sold in November last year fell by 22 per cent compared with November 2006. Figures from the Land Registry show that 90,581 properties were sold last November, down from 115,873 in the previous year. ...''

Posted by hpwatcher @ 02:56 PM 4 Comments

Official Land Registry Figures Show A Rise In January

BBC NEWS: House prices still slowing down

Oh Dear!!

Posted by basil bell, bath @ 02:25 PM 1 Comments

How long before Captain Darling tries this one?

Boston Herald: Frank wants state to buy foreclosed homes

Barney Frank (Rep) wants Uncle Sam to loan some $5 billion to buy foreclosed homes on the cheap and turn properties into affordable housing.

Posted by alan @ 02:24 PM 2 Comments

'Sound fundamentals in housing market'

Times: Redrow profits crash 35% on house sales slump

''Redrow, the Midlands-based housebuilder, became the first high-profile victim of the falling housing market as it reported a 34.5 per cent fall in first-half profits and gave warning of worse to come. ''

Posted by hpwatcher @ 02:22 PM 0 Comments

Buy to let article

BBC News: Buy-to-let firm in administration

One of the biggest buy-to-let investment companies in Wales has gone into administration. Cardiff-based A & A Property had more than 250 houses and flats on its books in different areas throughout Wales.

Posted by sitting tight @ 01:32 PM 0 Comments

six month old data shows house prices on edge of cliff

Firstrung: UK House prices increase by 6.4% year on year - Land Registry

House prices in England and Wales have increased by 0.9 per cent according to the latest monthly figures from Land Registry. The increase takes the average house price to 186,045. However, the data shows a decline in annual house price changes, from 6.7 per cent last month to 6.4 per cent this month. London experienced annual price growth of 13.1 per cent, with the average house price for January standing at 357,976. The largest monthly growth was seen in the North West with an increase of 2.0 per cent, taking the average house price there to 139,362. The volume of transactions was down on the same period last year, with an average of 100,648 per month in the months August to November 2007, compared with 117,173 per month from August to November 2006

Posted by converted lurker @ 12:17 PM 18 Comments

What Bernanke would say if he didnt have to lie

bigpicture blog: Why The Fed is Compelled to Lie to Congress

Opening statement of the FOMC Chair, Senate Testimony February 27, 2008: Senators, we find ourselves in a very challenging situation. Following the dot com implosion, my predecessor at the Fed slashed rates to a generational low of 1%; the FOMC then kept rates at 1% for over a year. While that re-inflated the economy, it also set off a shock wave of inflation unseen since the 1970s. Houses doubled in price, Oil is up 5 fold, food stuffs have tripled, and the dollar has collapsed. Gold is at multi-decade highs. ... The credit crunch is unprecedented, far worse than the S&:L collapse and Long Term Capital Management -- combined....

Posted by happyrenterz @ 11:45 AM 0 Comments

Anything to keep the costs down ...

Property Week: OFT seeks injunction against estate agents Foxtons

Most people have to earn their money, except for inverstors who have to risk their own cash and use their own skill, which is sort of working for yourself. Estate Agent are the target again, nobody has any sympathy for people who just sit there and demand money for no (or very little) work. Any landlord can then avoid putting up the rent on the next annual review if the Estate Agents fees are removed.

"The OFT objects to Foxtons' letting agreements which can potentially require landlords to pay it substantial sums in commission, where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired."

Posted by fahrenheit451 @ 09:51 AM 1 Comments

Ignore the pundits stay out of banking shares

MoneyWeek: Ignore the pundits stay out of banking shares

While equity analysts are messing about, dithering over whether banks are worth buying, the rest of the worlds asset markets are screaming about the end of the world. Weve been living through a credit bubble banks sell credit, and so theyve prospered. But now the bubble has burst. That means the hard times for the banks are just beginning. Just as when the tech bubble burst, people will have a hard time coming round to believing its all over, and will keep buying on the dips. But ignore those tasty dividend yields...

Posted by damien @ 09:37 AM 0 Comments

... and homeowners feel the squeeze

Independent: Banking gets back to normal after years of excess

The other alarmist speech came from Hector Sants, FSA CEO. "I don't think markets are ever going to return to the way they were. The idea that at some point they will go back to normal, I think, is a misnomer." The era of cheap borrowing, he added, was over. That cannot be right either or rather it is only right if you assume that the past three or four years were normal. By historical standards they were most abnormal for two reasons. The primary cause was abnormally low real interest rates, as you can see from the first graph. This shows real short-term interest rates in the developed countries. That dip of real rates to below 1 per cent for five years was the result of flawed central banking policies. YEESSSSSSSS!!

Posted by confused76 @ 08:40 AM 25 Comments

Eurozone downturn?

The Telegraph: Soaring euro threatens European jobs exodus

The euro has surged to an all-time high of $1.51 against the dollar, prompting bitter complaints from European industry and setting off a sharp sell-off in sovereign bonds from southern states deemed least able to withstand a super-strong currency.

Posted by sold 2 rent 1 @ 07:29 AM 31 Comments

Government trying to force down CPI by the back door!

Telegraph: Alistair Darling to threaten gas firms with tax

Alistair Darling is threatening to land gas companies with a windfall tax unless they cut bills for their customers.

Posted by tyrellcorporation @ 07:02 AM 10 Comments

Oops ... shouldn't have said that!

BBC: Wales' tallest building approved

Scroll down to the end of the article for this blinding insight ... ... Michael Jones, from Michael Jones Estate Agents in Cardiff, said the housing market in the city was slowing down. "With the development of the bay, there have been a lot of people buying and speculating, and that bubble does appear to have burst," he told BBC Wales."... We've overdeveloped certain areas and built the wrong type of properties."

Posted by mark wadsworth @ 06:00 AM 6 Comments

Many investors expect a post-Olympic economic slowdown in China, as infrastructure spending slows and activities related to the run-up to the games wane. But a pullback could materialise before the Olympics, not after.

FT.com: Insight: China unable to breathe easy over Olympics

While global financial markets remain focused on the ongoing credit crunch in the US, another market-rattling problem could be brewing thousands of miles away in China.

Posted by chris @ 01:47 AM 0 Comments

Confession of a Banker

Guardian: Huge bonuses for bankers encourage too much risk-taking, watchdog warns

The boss of the Financial Services Authority this morning launched an attack on the culture of big City bonuses, warning that they could encourage too much risk taking. Hector Sants also said the markets would never go back to "normal" following the credit crunch and that the days of easy credit for customers may be over.

Posted by quiet guy @ 12:44 AM 0 Comments

Wednesday, February 27, 2008

News for the great unwashed

The Sun: Solid foundations - viewings are on the rise.

Persimmon chairman John White said: "We are not calling the turn but, as each week goes by, we have definitely seen an improving trend. More people are visiting our sites each week and there are more reservations. While mortgage lending has tightened, people now understand the new criteria more clearly, and more are coming to look at our new homes. THE SUN SAYS: This is the first piece of good news from this battered sector for a while. Longer term, prospects should be good, with demand for new homes outstripping supply.

Posted by little professor @ 10:42 PM 14 Comments

Fun with Numbers

ConspiracyPenPal: Fun with Numbers

Hey, boys and girls! Want to have some fun? With numbers? Follow along and let's see just how much fun Mom & Dad have been having with what they call "finances."

Posted by lost @ 09:07 PM 1 Comments

Adult Kids double their parent sponging levels as they slip into debt.

BBC: Kids plundering parents' savings

Interesting little article if you read it, includes the hidden gem revealing that 42% of Adult Kids used money from their parents to pay debts up from 22% last year! Article also expects parents to stump up cash in the coming year for house deposits as 125% deals dry up!

Posted by enuii @ 09:01 PM 0 Comments

Buy a house in Detroit for $100

Realtor: Detroit housing

A bubble deflates...

Posted by happyrenterz @ 08:14 PM 0 Comments

Mortgage realities

Moneynet: BORROWERS LEFT HIGH & DRY AS MORTGAGES TIGHTEN

As the credit crunch tightens its grip, one of the most telling signs of what's to come can be found in the mortgage market. With lenders increasingly turning the screw and tightening their lending criteria many borrowers will be left high and dry with expensive and inflexible mortgage deals.

Posted by ram @ 08:06 PM 0 Comments

US - "toughest housing and mortgage markets in a generation"

BBC: Fannie Mae hit by housing gloom

US mortgage giant Fannie Mae has posted a $3.55bn (1.8bn) loss for the three months to the end of December. It blamed rising home loan defaults and set aside $2bn to cover further bad loans, warning the US housing slump could still get worse. The quarterly loss cut into full-year earnings and the firm reported a loss for 2007 of $2.05bn, compared with a profit of $4bn for the year before. It said it expects US house prices to fall between 5% and 7% in 2008.

Posted by jack c @ 05:08 PM 5 Comments

Speculation on the reasons behind Govt bailing out of Northern Rock

SOTT.net: Reading the numbers

110 billion is more than the UK government spends in one year on the entire National Health Service. So why is the UK government doing this and where is the money going? - The UK government is desperately trying to rescue a large UK mortgage lender while the Federal Reserve is secretly funding US banks to keep them afloat. The collapse of the international banking system is imminent. For the elite it will be a bonanza while for the rest of us it spells a return to servitude in a feudal society.

Posted by cybervigilantes @ 03:28 PM 0 Comments

Bernanke "economic conditions have become "distinctly less favourable" and could get worse."

BBC: Bernanke hints at more rate cuts

US Federal Reserve chief Ben Bernanke has hinted that the central bank is prepared to cut interest rates further to help ease recession fears. In his semi-annual report to the US Congress, Mr Bernanke said the Fed would continue to "act in a timely manner as needed to support growth". Analysts said his comments increased the likelihood of another rate cut at the Fed's next meeting on 18 March. US interest rates are currently at 3% after two major reductions in January.

Posted by jack c @ 03:22 PM 16 Comments

Cml Needs To Put Champagne On Ice In Relation To Buy To Let Mortgage Numbers Reaching The Million Mark

Firstrung: First time buyers priced out due to buy to let investors no reason for CML celebrations - Firstrung

As the CML proudly announced yesterday that the total buy to let mortgage number had finally passed through the one million mark Firstrung condemned firstly the insensitivity of this proclamation and secondly stated their position that (in their considered opinion) this figure actually represents one million less buying opportunities for first time buyers...

Posted by converted lurker @ 02:37 PM 5 Comments

this country needs such attitude!

Ananova: Girl's guilt over borrowed cash

A Polish girl racked with guilt over borrowing 13 from a man on holiday in Austria travelled hundreds of miles across Europe to try and return it.

Posted by alex228 @ 02:29 PM 3 Comments

Declining Home Prices, Rising Mortgage Rates

Roubini: Recession May Last Up to Six Quarters

Bloomberg: Roubini Interview Video

Only 5 minutes but worth a watch. Roubini is a bearish economist who has been spot on about the housing bubble.

Posted by happyrenterz @ 01:21 PM 5 Comments

On many US homes foreclosure is impossible

Tampa Bay Online: Mortgage Note Issues Help Debtors Avoid Foreclosure

Shortcuts taken in the rush to issue as many sub-prime mortgages as possible in the states have rendered homes impossible to foreclose

Posted by james @ 12:48 PM 0 Comments

MPs part in the property boom to be exposed

Guardian: Information tribunal rules that MPs should disclose details of expenses for second homes

MPs have lost a battle to block the detailed disclosure of expenses covering their second homes, power and telephone bills, and the furniture they buy... It should be released within 28 days, according to the ruling by an information appeal tribunal... The allowance - called the additional costs allowance (ACA) - entitles MPs to an additional 22,110 a year to cover the costs of setting up a second home if they live away from London... But MPs' addresses can be disclosed, unless there are specific security concerns, and the names of landlords and mortgage lenders would be released... John Spellar... said last night: "This decision is absurd and ridiculous. It will end with people writing about how much MPs are paying for a pint of milk." Does he pay ridiculous amounts for milk?!?!?

Posted by disillusioned @ 12:40 PM 12 Comments

Inflation fears - commodities are generally considered a hedge against inflation

BBC: Oil hits $102 for the first time

The price of oil has hit a record high for the second day running, touching $102.08 a barrel for US sweet crude. However, the figure is still surpassed in inflation-adjusted terms by the peak of $102.53 reached in 1980, the International Energy Agency says. The oil price surge is supported by traders switching their cash out of shares and currencies and into commodities, traders say. Fears that producers' cartel Opec will cut supply have also been blamed.

Posted by jack c @ 10:54 AM 14 Comments

A quiet voice of wisdom

Telegraph: Gordon Brown's long boom ending with recession is a real possibility

"Since then debt and house prices have inflated enormously to levels which, in relation to income, are now the most extreme in the developed world. The bubble is now bursting. Forward markets tell us that house prices are likely to fall 10pc on average this year. Serious people anticipate a 30pc to 40pc correction over the next few years." Is there a more level-headed and wise politician than Vince Cable? A breath of fresh air between the lamentable inanities coming from the Govt.

Posted by letthemfall @ 10:48 AM 8 Comments

Northern Rock shareholders deserve nothing

MoneyWeek: Northern Rock: a lesson in how shares go down as well as up

Private shareholders are happy to take the verdict of the market when share prices are going up. They will have to take it on the chin when things go the other way. And, if they want to be taken seriously, they will have to grow up.

Posted by damien @ 10:27 AM 4 Comments

Daaaaaad, can I borrow a couple of Grand to pay my credit card debt

The Corporation: Kids plundering parents' savings

Once it was just the magic fridge that children raided, only for it to be refilled by their parents. Now a survey claims adult youngsters are plundering their parents' savings at an increasing rate. Some 55% of parents polled had given an average of 12,610 to their children or grandchildren, according to the survey by Scottish Widows Oh to have a wealthy parent... My parents ask ME for money...!!!

Posted by george monsoon @ 10:07 AM 1 Comments

It's different this time......

Times: HBOS profits hit by downturn in credit markets

''HBOS, Britains biggest mortgage lender, reported broadly flat annual profits for 2007 as it struggled to maintain margins in its core retail banking business. The owner of Halifax and Bank of Scotland posted a 3 per cent increase in underlying pre-tax profits to 5.71 billion in the year to December 31, compared with 5.54 billion the previous year''

Posted by hpwatcher @ 08:43 AM 2 Comments

Houses crash for real

Guardian: Earthquake shakes Britain

Sorry, I couldn't resist!! I wonder how many Barrat homes were destroyed in the the quake.. I bet all the new build homes in the area are dropping to bits after last nights quake!

Posted by george monsoon @ 08:01 AM 14 Comments

Lambs to the slaughter

ThisIsMoney: BTL mortgages hit 1 million as house prices tumble

Nearly 1,000 buy-to-let mortgages were taken out every day last year, pushing the number of the loans to a record one million. The figures emerged as evidence grows that the decade-long house-price boom is over, with prices falling across the country. Britons have taken out a total of 1.04m BTL mortgages - up from fewer than 30,000 when records began in 1998. This was despite the fact that experts predict house prices have stopped climbing, and the average gross annual rental yield (rental income expressed as a percentage of a home's current value) is negative for the first time, according to ARLA.

Posted by little professor @ 07:35 AM 35 Comments

A return to old-fashioned banking?

thisismoney: Cheap credit 'gone forever' - City watchdog

The era of cheap credit may be over forever, the head of City regulator the Financial Services Authority said today. Hector Sants said he believes the financial markets will never return to the practices prevailing before the global turbulence sparked by last summer's crisis in the US sub-prime mortgage market.

Posted by uncle chris @ 07:33 AM 8 Comments

It's different this time

Independent: What we learned from the 80s crash

Are we heading for another recession? Four experts who survived the last big crash explain why 2008 should not be the year of a similar meltdown. The estate agent, Peter Bolton King: "I'm expecting a soft landing this time, rather than a crash, with zero price growth in 2008. There is a big difference between then and now. In the early 1990s there were high interest rates, high unemployment and high inflation. We have none of those three things now. I don't think we should panic." The mortgage lender, Mark Boleat: "The turn came fairly quickly, in 1988. There were clear reasons for it - rising interest rates and soaring unemployment levels. That's the big difference between then and now."

Posted by little professor @ 07:32 AM 23 Comments

USA heading for long deep Japan-style recession

Telegraph: Dollar's slump to $1.50 raises European alarm

The dollar tumbled through the $1.50 mark against the euro for the first time today as the US Federal Reserve made clear it will slash interest rates further to head off a severe recession. The Fed's influential vice chairman, Donald Kohn, yesterday played down the inflationary threat in America, arguing instead that "the adverse dynamics of the financial markets and the economy have presented the greater threat to economic welfare in the US."

Posted by uncle chris @ 07:25 AM 5 Comments

Banks may be forced to change the way they do business

BBC Economy: FSA sees credit squeeze on banks

FSA chief executive Hector Sants said banks will never again be able to raise as much money as cheaply as they had been doing by selling off their loans. In an exclusive interview with the BBC, he said they will have to keep more of their loans on their own books. That, in turn, may permanently push up the cost of borrowing for all of us. "Banks themselves need to give consideration to how their business models will need to adapt to the changed market circumstances they have seen," said Mr Sants

Posted by ram @ 06:48 AM 0 Comments

Expect a rebound of the U.S. dollar, says Hans Redeker, global head of forex strategy at BNP Paribas

cnbc: Greenback Rebound

USD Undervalue Against The Euro And Several Major Currencies

Posted by chris @ 06:43 AM 0 Comments

Tuesday, February 26, 2008

Fashion chain in administration

BBC News: Fashion chain in administration

Women's fashion store chain Select Retail has gone into administration. Select blamed the move into administration on a "deteriorating trading performance" since the start of the year. Yeah that's right since the START of the YEAR! Things must be bad on the high street!

Posted by no room at the inn @ 10:21 PM 0 Comments

In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food and energy left wholesale inflation rising at the fastest pace in a quarter-century..

YAHOO BIZ: While Wholesale Inflation Rises at Fastest Pace in 26 Years

In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food and energy left wholesale inflation rising at the fastest pace in a quarter-century..

Posted by chris @ 09:03 PM 0 Comments

Question: Who thought about this study?

AP - Yahoo: Banks crises bad for hearts: British researchers

Thousands of people could die from heart attacks if there was a widespread repetition of the crisis at Britain's Northern Rock bank, according to a study published by British researchers on Tuesday. A team of sociologists at Cambridge University suggested that the stress of a system-wide banking crisis could lead to a 6.4-percent surge in heart attacks in high-income countries such as Britain and the United States

Posted by stevie dee @ 08:40 PM 0 Comments

A big change in the financial industry's laissez-faire attitude

IHT.com: After subprime debacle, U.S. wrestles with question of bank bailouts

US - Over
UK - Doomed
Ireland - Finished
Spain - Buried
Australia - Down and Out

Posted by lvmreader @ 08:24 PM 5 Comments

It seemed like a good idea at the time, eh Andr?

IHT.com: Credit crunch reaches picturesque resort

The effects of the worldwide credit crunch reached a remote part of Idaho this month. Four-year-old Tamarack Resort said construction of its ski village near McCall, Idaho, has ground to a halt after Socit Gnrale pulled the plug on a $118 million loan Tamarack needed to finish the complex of shops and condominiums. Tamarack is the biggest new public ski-and-golf resort built in the United States since Deer Valley, Utah, opened in 1981. Andre Agassi and Steffi Graf, the tennis champions who are husband and wife, gave the resort a lift when they agreed in 2006 to build a Fairmont hotel there.

Posted by lvmreader @ 08:19 PM 0 Comments

Fake Wealth get used to it

Harpers: The next bubble: Priming the markets for tomorrow's big crash

"That the Internet and housing hyperinflations transpired within a period of ten years, each creating trillions of dollars in fake wealth, is, I believe, only the beginning. There will and must be many more such booms, for without them the economy of the United States can no longer function. The bubble cycle has replaced the business cycle." Great article, recons the next bubble is alt energy.

Posted by happyrenterz @ 06:07 PM 25 Comments

Indeed it s the start of the BTL blues!!

Independent: Buy-to-let landlords feel the strain

"According to new figures from the Council of Mortgage Lenders (CML), the number of landlords in arrears on their mortgage by more than three months rose to almost 7,600 during the final three months of last year, up from about 6,050 in the previous quarter. Year on year, the number of landlords in arrears was up more than 54 per cent." REPOSSESSIONS, WHATs IN A NAME!

Posted by confused76 @ 05:46 PM 0 Comments

BBC puts the Boot into Provincial City Centre BTL New-Build Flats

BBC: Have the buy-to-let blues begun?

With a remarkable change of sentiment the BBC fingers Manchester, Leeds, Nottingham and Birmingham as New-Build Buy-To-Loose hot spots and features Manchesters up-market Beetham Tower as a particularly good example.

Posted by enuii @ 05:28 PM 4 Comments

What silver's strength means for the gold price

MoneyWeek: What silver's strength means for the gold price

Last week was a good one for precious metals. But although it is gold which has been hitting all-time highs, silver has actually risen the most so far this year. And that's a very important technical development.

Posted by damien @ 04:28 PM 3 Comments

The newbuild market is gone!

Times: Dont fall for the freebies offered by package home developers

an example of how the media tune is changing. but my favourite is the reader comment who sums up the lack of brain of typical BTL investor: "Simple principle in finance, the less you pay for a high value asset, the more risk you take on. You are then compensated for the additional risk by high returns. Warren Buffet Wannabe, London"

Posted by confused76 @ 04:15 PM 4 Comments

Liquidity or Solvency?

Telegraph Online: BoE fears largest ever peacetime liquidity crisis

The Bank of England's Deputy Governor today warned that the ongoing credit crunch had left the Monetary Policy Committee uncertain as to its next move as it and fellow central banks face up to what she described as the "largest ever peacetime liquidity crisis".

Posted by in the delhi @ 04:07 PM 0 Comments

French to Combatt Inflation with Overtime

Guardian: France's Sarkozy tackles voters' inflation worries

Nicolas Sarkozy on Tuesday stated that his government was working to combat soaring food prices and was ready to do more to encourage overtime work to put more money in peoples' pockets.

Posted by enuii @ 03:52 PM 4 Comments

the gap between high and low incomes is too wide

FT: How super-rich can avoid lynching

"That sentiment has marked the US presidential election campaign as fears of recession grip the country. House prices are falling, over-stretched mortgage holders are losing their homes, banks have blown billions in the credit markets and yet disgraced financiers have walked away with millions in a perverse heads-I-win, tails-you-lose kind of capitalism. The two remaining Democratic candidates, Barack Obama and Hillary Clinton, have been feeding off such populist resentments. Mr Obama, in particular, has been attacking the moral deficit in the US that has led to such a wide divide between the super-rich and 37m poor Americans. We have a deficit when CEOs are making more in 10 minutes than some workers make in 10 months, he says."

Posted by happyrenterz @ 03:46 PM 0 Comments

Timmmmbeeeeeeeeer!

The Associated Press: Home Prices Drop 8.9 Percent in 3 Months

NEW YORK (AP) A closely watched study shows U.S. home prices falling 8.9 percent in the fourth quarter of 2007. That marks the largest drop in the index's 20-year history and a full year of declining values. The Standard & Poor's/Case Shiller home price indices reflect year-over-year declines in 17 metropolitan areas with double-digit declines in eight of them. Index architect Robert J. Shiller said "wherever you look things look bleak." The quarterly index tracks prices of existing-family homes nationwide compared with a year earlier.

Posted by disillusioned @ 03:43 PM 0 Comments

Dress rehearsal for the UK housing market.

Bloomberg: S&P/Case-Shiller Home Prices Fell 9.1% in December

Feb. 26 (Bloomberg) -- Home prices in 20 U.S. metropolitan areas fell in December by the most on record, reflecting the deepening housing recession, a private survey showed today. The S&P/Case-Shiller home-price index dropped 9.1 percent from December 2006, after a 7.7 percent decrease in November. Nationwide, home prices fell 8.9 percent in the fourth quarter from a year earlier, the biggest decline in 20 years of record keeping. Prices may fall further as would-be buyers hold out for bargains and foreclosures add to the glut of unsold properties, extending the worst housing slump in a quarter century. Shrinking home values and credit restrictions threaten to reduce consumer spending and push the economy into a recession.

Posted by yt1 @ 03:11 PM 0 Comments

The US market just gets worse.

BBC News Website: US foreclosures up 57% in January

This is amazing. At the moment the US problems seem to be accelerating. The UK is probably 18 months behind the US, so we have just seen the start here, but by this time nex year all will be apparent.

Posted by mike livingstone @ 02:31 PM 0 Comments

The shape of things to come for the UK

USA Today: US house prices drop 8.9%

Steepest drop in the 20 year history of the Standard and Poor US house index

Posted by whitek6 @ 02:23 PM 0 Comments

Expect huge backlash from US taxpayer

Market Oracle: Subprime Mortgage Scam Lands US Tax Payer $739 Billion Bailout Bill

"Why on earth would the taxpayer want to buy 600,000 subprime mortgages at current value when housing prices are falling, inventory is soaring, sales are sagging, foreclosures are at historic highs, and millions of homeowners are expected to simply walkaway from their loans?"

Posted by sold 2 rent 1 @ 02:13 PM 5 Comments

The Bank of England's deputy governor has said the outlook for the UK economy in 2008 has "changed dramatically".

BBC: Bank warns of more economic risks

Rachel Lomax said there was uncertainty over the full impact of "the largest ever peacetime liquidity crisis". The deputy governor believes the credit crisis will significantly reduce demand over the next two years.Inflation is also forecast to rise more sharply. Ms Lomax warned this may lead to higher interest rates than expected if prices and wages rise further.

Posted by jack c @ 01:34 PM 9 Comments

When will BoE reveal its inflation secrets?

Bloomberg: Producer Prices in U.S. Increase More Than Forecast

Prices paid to U.S. producers rose more than twice as much as forecast in January, pushed up by higher fuel, food and drug costs, signaling inflation may keep accelerating even as growth slows. The 1 percent increase followed a 0.3 percent drop in December, the Labor Department said in Washington. The median forecast in a Bloomberg News survey of economists was for a 0.4 percent gain. Excluding food and energy, so-called core wholesale prices climbed 0.4 percent, the most in almost a year. Combined with figures showing consumer prices also rose more than forecast, today's report may prompt the Federal Reserve to consider raising interest rates as soon as the economy stabilizes.

Posted by yt1 @ 01:19 PM 2 Comments

Unlike UK, the US knows how to purge.

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset (Update2)

Feb. 26 (Bloomberg) -- Bank seizures of U.S. homes almost doubled in January as property owners failed to make higher payments on adjustable-rate mortgages. Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent. ``The most troubling thing is that we are seeing more and more of these properties actually going all the way through the process and going back to the banks,'' Rick Sharga, executive vice president of Irvine, California-based RealtyTrac, said in an interview.

Posted by yt1 @ 01:07 PM 1 Comments

Nearly put my money into this lot. It's a minefield out there!!

BBC: London Scottish Bank scraps dividend as losses hit 16m

London Scottish, which has been in discussions with the City's top watchdog the Financial Services Authority (FSA) over its capital base for five months, said that it had a capital shortfall of 12.7 million on January 1. It has been ordered by the FSA to increase reserves dramatically, but said today that it has agreed a plan, which will mean selling parts of the business, reducing lending volumes, scrapping the dividend and seeking alternative funding

Posted by cheekie charlie @ 01:04 PM 0 Comments

Revival of BBC comedy

BBC: Buy-to-let market still thriving

"None of this is surprising, this is the most prime sort of lending," said Malcolm Harrison of the Association of Residential Letting Agents (ARLA).

Posted by cheekie charlie @ 12:44 PM 3 Comments

"not so much flat, as falling"

BBC Evanomics: Flat Market

Excellent article showing an understanding of the lies and half-truths told by pyramid groups in collaboration with surveyors and authorities to dupe the greedy and desperate.

Posted by bystander @ 12:39 PM 5 Comments

Will this be the final straw for Labour?

sky news: Iraq Cabinet Discussions To Be Revealed

The Government has been ordered to release the minutes of Cabinet meetings where military action against Iraq was discussed.

Posted by sold 2 rent 1 @ 12:17 PM 4 Comments

PRICELESS!!! Sign-of-the-times I guess.

BBC: Lender moves to debt collection

Mortgage and loan firm London Scottish Bank has said it is to end its lending business to focus on debt collection.

Posted by tyrellcorporation @ 11:36 AM 5 Comments

Foxtons in trouble

Firstrung: The OFT has issued High Court proceedings against Foxtons estate agents

The OFT has issued High Court proceedings against Foxtons Limited seeking a declaration on the application of the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs) to certain terms in Foxtons' lettings agreements with landlords. The OFT is also seeking an injunction against Foxtons preventing it from using the terms...

Posted by converted lurker @ 11:33 AM 6 Comments

Increase in Buy to Let Lending - and spin

FT: Buy-to-let lending up in 2007

"Michael Coogan, CML director general, commented: "Tenant demand for private rented property remains strong and buy-to-let is fulfilling an important role in helping to deliver an increased flow of high quality homes to rent. " - Waffle. what's the high quality bit got to do with it? Some are bogging. "The proportion of buy-to-let mortgages taken into possession was also smaller than in the wider market" - Only just, so far & the trend is massively up. "We expect to see a continuing healthy appetite for buy-to-let finance this year, in line with continuing expected consumer demand for private rental property." - only from naive investors with deep pockets. Risky - Rent will barely cover costs, no cushion for contingencies and why buy a capital asset at the top of the market?

Posted by jonathan @ 10:54 AM 3 Comments

No directly related to HPC

The Telegraph: Anti-depressants 'no better than dummy pills'

Seeing as we already discuss corruption and fraud in financial/political areas, is this article saying that the big pharma companies have been selling us a lie for decades, or did they really not know their drugs were not necessary.

Posted by sold 2 rent 1 @ 10:40 AM 11 Comments

an alternative view to the Nationwide 25% deposit i'ssue'

Firstrung: Buy to let investment now over as Nationwide raises deposit requirements to 25%

Nationwide has signalled the death knell to buy to let investors by announcing that is was effectively 'shutting the door' on buy to investment as it raised its deposit requirements (for its best mortgage rates) to 25%. Buy to let investors, who typically revolve their credit agreements and flex more equity out of each property with each 'new deal' to increase their portfolio will be left stunned by this development...

Posted by converted lurker @ 10:27 AM 0 Comments

Inflation - the only solution...

Dan Amerman: Turning Inflation into Wealth

Chilling dissertation about the impossible pension and healthcare liabilities of Western Governments and how they will be solved with inflation. Thought provoking for anyone who has sold to rent and is wanting to look after their stash in the mean time...

Posted by cornishman @ 10:23 AM 19 Comments

The housing slump is here to stay

MoneyWeek: The housing slump is here to stay

The UK housing market is looking more sickly than at any point since the housing crash of the early 90s. The optimists are still clinging desperately to the hope that falling interest rates will save the market. But those hopes look like being dashed, now that one of the countrys top mortgage lenders has admitted that it would rather turn away business than dish out any more risky loans

Posted by damien @ 09:42 AM 3 Comments

January saw a 90% year on year increase in U.S. repossessions

Bloomberg: U.S. Home Foreclosures Jump 90% as Mortgages Reset

Repossessions rose 90 percent to 45,327 last month from the same period a year ago, RealtyTrac Inc. said today in a statement. Total foreclosure filings, which include default and auction notices as well as bank seizures, increased 57 percent.

Posted by 51ck-6-51x @ 09:22 AM 0 Comments

The market is crumbling!

Times: Persimmon profits flat as order book drops 20%

Visitor levels have been increasing week by week since the start of 2008, but conversion to sales ratios remain "challenging," the company's trading statement says

Posted by confused76 @ 09:14 AM 2 Comments

Yet more credit woes for the financial powerhouses

Bloomberg: Goldman, Lehman May Not Have Dodged Credit Crisis

* Variable interest entities (VIEs) may contribute another $88bn in losses for banks roiled by the collapse of the housing market - CreditSights Inc. * A fire-sale of VIEs has "Always been our greatest fear," Gregory Peters - Morgan Stanley * Wall Street firms may be forced to return those assets to their books, recording the declining value as losses. * VIEs, aka conduits, had $784 billion in commercial paper outstanding as of last week - Moody's Investors Service & the Federal Reserve. * "Predictions for losses vary widely because banks aren't required to specify the type of assets being held in VIEs or how much they are worth," Tanya Azarchs - S&P

Posted by 51ck-6-51x @ 08:40 AM 0 Comments

The Governor of the Bank of England, has issued a sober assessment of UK house prices.

FT: Mervyn King predicts 4 years of falling house prices

In yet another blow for the housing market, Mervyn King, the Governor of the Bank of England, has issued a sober assessment of UK house prices. The Governor warned that UK house prices may fall in real terms for as long as the next four years, as prices largely stayed the same or fell. He was speaking following the release of the Bank's quarterly inflation report, in which he dampened market hopes of a series of interest rate cuts.

Posted by jack c @ 08:05 AM 19 Comments

Scotland's runaway property boom is over, with house prices falling for the first time in seven years.

FT: Scot property market 'stopping to get breath'

The average price of a house in Scotland has fallen by 411 a week - or nearly 60 a day - in the last three months, according to a report by Lloyds TSB. But despite the quarterly fall, all areas of the country are still showing healthy annual price increases of up to 30 per cent, with Aberdeen remaining Scotland's top property hot spot.The latest Lloyds TSB Scotland Scottish House Price Monitor said there is no cause for panic despite the boom in prices coming to an end. The bank said that property prices in Scotland will "plateau" with the country avoiding a damaging boom-bust scenario.

Posted by jack c @ 07:53 AM 5 Comments

Lenders don't want your business

Guardian: Banks are kicking away the bottom rung of the property ladder

"As a consequence of the credit crunch and sub-prime mortgage concerns, lenders have become much more careful about who they lend to, and on what terms. What we're seeing now is lenders leapfrogging each other to pull deals or raise rates, effectively chasing each other down the best-buy tables. The big mortgage lenders are in competition with each other - but this time it's to be nowhere near the top of the table"

Posted by little professor @ 07:42 AM 7 Comments

Misleading headline

Telegraph: Interest rate cuts are helping house prices

Persimmon, Britain's biggest housebuilder, said that the two interest rate cuts since November are slowly starting to improve consumer sentiment, although it revealed its reservations were 19pc lower than this time last year. The Persimmon chairman said that while many were still adopting a "wait and see" approach to buying a new home, Persimmon was seeing more customers come through its doors every week since the new year. However, converting those visitors into buyers "remained challenging", he said.

Posted by little professor @ 07:39 AM 6 Comments

Wheat prices up 25% in a day - but CPI still around 2% - honest

FT.com: Wheat prices in biggest one-day rise

Prices of top-quality wheat jumped 25 per cent to a record high on Monday in their largest one-day increase as Kazakhstan, one of the largest grain exporters, said it would impose export tariffs to curb sales. The move, which follows similar export restrictions in Russia and Argentina, is likely to put further pressure on already tight global wheat supplies, analysts said.

Posted by uncle chris @ 07:27 AM 7 Comments

Tricks to give the remaining smart money time to escape

The Times: Ten tips to survive a property downturn

These tips seem designed to avert panic thereby preventing in the short term on run on houses. Equally they looked designed to lure in innocent first time buyers. Meanwhile the so called smart money that has been extracting itself will be given more time to get out.

Posted by mikelivingston @ 07:25 AM 1 Comments

New product for FTB's

Firstrung: 95% FTB mortgage

Not all mortgage companies are restricting lending, as i said the competition for business is still there...

Posted by greenbay @ 06:35 AM 6 Comments

Monday, February 25, 2008

Campaign: Help our Central Banks & Financial Institutions

wikipedia: Monopoly (game)

Our Banks need your help with the Credit Crunch, so do your bit by sending 1,000 notes to these distressed institutions. (Northern Rock are not accepted).

Posted by stevie dee @ 11:27 PM 0 Comments

George Magnus, UBS senior economist advisor

FT: UBS on a Trillion Dollar Meltdown

George Magnus was one of the first to speak of a Minsky Moment last year. Recons the US economy won't bounce back so quickly later this year. The only solution to this crisis is regulatory not liquidty. This guy seems to see things clearly, it is a pity UBS don't listen to their own advisers!

Posted by happyrenterz @ 09:48 PM 8 Comments

How fraud led to this property changing hands 3 times as son of owner sat dead inside

Chicago Tribune: This house was a steal

"The new buyers of a rundown graystone on the South Side showed up Jan. 9 to look at the house they won at a foreclosure auction. They took the plywood off the front door and went inside to make sure the utilities had been shut off. Then they called the police. Sitting upright in the corner of a bedroom off the kitchen was a human skeleton in a red tracksuit. Next to him lay a dead dog. Neighbors told police the corpse was almost certainly Randy Johnson, a middle-age man who lived alone in the North Kenwood house."

Posted by happyrenterz @ 09:30 PM 3 Comments

If you haven't got a 25% deposit the the Nationwide isn't interested.

Times: Nationwide blow to first-time buyers

The Nationwide knows the market is on the way down and is increasing it's degree of comfort accordingly. "We have altered the tier structure for loans as part of our commitment to being a prudent and responsible lender and in response to the high cost of funding and a cooling housing market."

Posted by enuii @ 07:18 PM 8 Comments

Get that AAA rubberstamp out again!

Bloomberg.com: Stocks in U.S. Rally After S&P Affirms AAA Credit Ratings on MBIA, Ambac

Firesale of assets averted, for now. I wonder what it took to swing S&P around?? Was the deal struck with Washington to drop any inquiry into credit rating agencies' role in the sub-prime debacle in exchange for that politically and economically very precious AAA??

Posted by trough2010 @ 07:11 PM 7 Comments

This weeks comedy article from Ztuart Law

Assetz: Buy to let looking bright for 2008

Buy-to-let investment in the UK is set to go from strength to strength in 2008, it has been suggested. Rental demand is increasing all the time, according to Mr Harrison of ARLA, who said the reasons behind this trend are "demographic". These factors include things such as increasing migration and rising divorce rates. "Traditionally, every time you have house price softening you get increased rental demand," Mr Harrison said. Last year saw the typical buy-to-let property rise by 10.9% to reach an average of 154,795, and Mr Harrison believes that this price will edge upwards.

Posted by little professor @ 05:49 PM 19 Comments

After years of watching house prices soar even faster than those in America -- modest, three-bedroom tract houses in the London suburbs were going for US$2.2 million at one point -- Britons are now weathering a sharp rise in mortgage defaults

chinapos: Subprime casualties surface in Britain

Europe has its own burgeoning mortgage meltdown -- in Britain. After years of watching house prices soar even faster than those in America -- modest, three-bedroom tract houses in the London suburbs were going for US$2.2 million at one point -- Britons are now weathering a sharp rise in mortgage defaults.

Posted by chris @ 05:46 PM 2 Comments

While costs in China are rising nationwide, the greatest pain is being felt in the south, where about 14,000 out of the 50,000 to 60,000 Hong Kong-run factories could close in the next few months, said Polly Ko of the Economic and Trade Office in Guangdon

chinapost: Rising material and labor costs squeezing Chinese factories

Costs have climbed so much that three-quarters of businesses surveyed by the American Chamber of Commerce in Shanghai believe China is losing its competitive edge. Americans continue to want to buy at lower prices," said Kevin Burke, president and CEO of the American Apparel and Footwear Association. "They are used to going to the store during Christmas and getting something cheaper than a year ago." That's no longer a sure thing.

Posted by chris @ 05:42 PM 0 Comments

The US Treasury, in a significant policy shift, has decided it will support gold sales from the International Monetary Fund's reserves if they are part of a package of cost-cutting and other reforms of the way the international financial organization oper

hemscott.: US Treasury to support IMF gold sales if linked to cost-cutting, reforms

Under Secretary for International Affairs David McCormick will lay out the details in a Washington speech later today. In a pre-address briefing for reporters, he said the Bush administration -- which had until now opposed selling IMF gold reserves -- would support a sale of the scale of roughly 8 pct of the IMF reserves or 12.9 mln ounces as part of a package of reforms which also included significant cost-cutting in IMF operations.The proceeds would be used to create an endowment from which the income would be used to finance the IMF operations.

Posted by chris @ 01:57 PM 11 Comments

Senior American bankers and business leaders are planning to quit Britain As many as nine US citizens working in London at boardroom level are already said to have begun preparations to leave the country

TELEGRAPH UK: Top US businessmen prepare to quit UK

over Treasury plans to tighten tax rules on "non-domiciled" residents, it was reported today. . Alistair Darling wants some non-doms to pay 30,000 a year to the Treasury They work for investment banks like Bank of America and Bear Stearns and international companies including McDonald's

Posted by chris @ 01:45 PM 13 Comments

Well, what else did you expect?

Times: Mortgage approvals spread more housing gloom

There was fresh evidence of a slowdown in the housing market today as figures revealed that mortgage approvals for new home purchases fell by a third in January compared to January 2007. remortgages which accounted for a record 49 per cent of all mortgage approvals.

Posted by hpwatcher @ 11:45 AM 2 Comments

Inflation - No! Surely Not? Not Here In The UK (Yeah Right)

New York Times: Rising Inflation Creates Unease in Middle East

Even as it enriches Arab rulers, the recent oil-price boom is helping to fuel an extraordinary rise in the cost of food and other basic goods that is squeezing this regions middle class and setting off strikes, demonstrations and occasional riots from Morocco to the Persian Gulf.

Posted by waitingfor hpc @ 11:16 AM 5 Comments

Does this solve the problem?

New York Times: Ambac Rescue May Be Announced Mon Or Tues: Source

A rescue for bond insurer Ambac Financial Group Inc may be announced on Monday or Tuesday, a person familiar with the matter said on Friday.

Posted by waitingfor hpc @ 11:11 AM 1 Comments

One of the biggest worries is Goldman's large exposure to leveraged loans, which totaled $42 billion at the end of the firm's last quarter, according to analyst calculations

money web: Goldman's profit magic may be fading

Goldman also faces hefty losses on some of its large equity stakes. The most brutal could come from Industrial & Commercial Bank of China Ltd., whose shares have fallen 16% on the Hong Kong Stock Exchange since the end of November. That slide could translate into a financial hit for Goldman of roughly $400 million, based on figures provided in the firm's regulatory filings. Overall valuation losses on such large corporate investments could reach $1.4 billion, according to Mr. Trone.

Posted by chris @ 11:01 AM 3 Comments

Barclay's equity study predicts doom

MoneyWeek: Investors Bible predicts doom

The annual Equity Gilt Study from Barclays Capital normally shows shares to be the best investment over extended time periods. But not this time. It looks like we've reached the end of an era.

Posted by damien @ 10:50 AM 0 Comments

All newcomers to HPC - please watch video

You Tube: Corrupt Banking System - Cartels Robbing the Public

Corrupt Banking System - Cartels Robbing the Public

45 mintues in 5 parts - this video explains how our debt-based monetary system is flawed. Money as debt is the underlying cause of todays banking crisis

Posted by sold 2 rent 1 @ 10:30 AM 6 Comments

Cooling rapidly, despite the hot air

FT: Britain can no longer depend on being cool

"A house price crash would take time to unfold. Assuming a constant inflation rate of 2 per cent a year, nominal house prices would have to go down by about an unprecedented 25 per cent if the decline stretched over six years. Remember: the first stages of a housing downturn consist of denial followed by anger. A fall in actual prices is a relatively late-stage phenomenon of a housing crash." Some substance from the FT. Unlike the witterings we get from our unillustrious chancellor.

Posted by letthemfall @ 10:17 AM 4 Comments

Gold investors - Heads up - Could gold be made illegal?

Market Oracle: Will the G-7 Nations Impose Capital Controls?

Storing bullion in Switzerland [as the Bullion Vault does for its clients] is a way to go and we would happily recommend working with them as we will do, as it is out of the reach of the G-7. The only drawback to that is that it remains in the name of the owners, who will be resident most likely inside the nations of the G-7. As such they are faced with a dilemma when they declare to their authorities that they own gold in foreign lands. It is no small step for those authorities to tell them to bring the gold home?

Posted by sold 2 rent 1 @ 10:10 AM 21 Comments

Buyers are registering, but how many are going to go ahead and buy something

Citywire: House prices fall again as buyers start to warm up, says Hometrack

House prices have fallen for the fifth month in a row with prices dipping by 0.2% in February but there are tentative signs of a potential recovery with a sharp rise in new buyers registering interest with estate agents since last summer, according to Hometrack.Annual house price growth, now at 1.4%, is at its lowest level since April 2006, says the survey. But the number of properties listed with estate agents has jumped by 12.8% in February from January according to Hometrack.

Posted by jack c @ 10:01 AM 6 Comments

Brick chicks go to Hollywood

Times: Video: the Bricks Chicks on the most expensive property hotspots worldwide

These chicks are really really stupid. What can I say... watch the video. They make some funny remarks on why london is so overvalued, and blame the Chancellor for applying the stamp duty.

Posted by confused76 @ 09:28 AM 2 Comments

Despite the spin dreadful January lending figures from the BBA

Firstrung: Mortgage approvals for house purchase fall by 31% year on year continuing the downward trend

In its monthly analysis of the property market, the BBA has revealed that the number of mortgage approvals for house purchases was 44,288, up from 42,343 in December, which was an all time record low. January's figure is slightly better than certain analysts' expectations, which was for another low of circa 40,000 but is still below the six-month average of 50,484 and a 31.5% fall versus January 2007 figures of 64,648.

Posted by converted lurker @ 09:28 AM 0 Comments

Over there, now over here....

Guardian: Hefty US interest rate cuts do not seem to be arresting slide towards recession

''Economic crises go through four distinct stages. First, there is the bubble-induced mania when markets rocket skywards and the word on the street is that the good times will last for ever. After bubble comes denial. This is the period when it is obvious to any independent-minded observer that the party is over but policymakers and the financial markets can't bring themselves to admit it. We hit this phase in spring 2007, when the received wisdom was that the crisis in the US sub-prime mortgage sector was a little localised difficulty that would be comfortably contained. There were no wider implications for the rest of the US economy, let alone the stability of the financial markets or the global economy as a whole.''

Posted by hpwatcher @ 08:13 AM 0 Comments

I would not use the word suffer...

Telegraph: Tighter credit means property values will suffer

''The word crash has always been misleading. A dribbling lower is what can be expected. It has started slowly but the momentum will build up as the tightening of credit conditions comes through and the labour market worsens.''

Posted by hpwatcher @ 07:43 AM 1 Comments

From 25% to 45% of all these respected Economists think...

AP - Yahoo: Top Economists See Growing Signs That the Country Has Toppled Into a Recession

Job growth is faltering, consumer confidence plunging. The fallout from the worst housing slump in a quarter-century grows. Wherever you look, the signs are unmistakable that the economy is in trouble.

Posted by stevie dee @ 07:27 AM 0 Comments

The Financial Services Authority is to issue new guidance on directors' dealings after being contacted by scores of UK company directors who are preparing to sell shares ahead of April 6 to avoid the widely-criticised 80pc rise in capital gains tax

TELEGRAPH UK: FSA to issue new guidance on CGT sales

News of their plans comes as one of Britain's largest insurers, privately-owned Towergate, confirmed management is selling a stake to cash in part of their fortune before it is eroded by the tax hike. Towergate is the largest company so far to reveal it is planning a sale primarily to avoid the tax change from 10pc to 18pc on business assets. The 3bn group, founded by chairman Peter Cullum, is in "preliminary discussions" to sell a 25pc holding to private equity firm Candover.

Posted by chris @ 12:50 AM 0 Comments

Gold hits the mainstream press

Times: The dollar versus gold? No contest

Gold has retained its value, though with fluctuations, over centuries. Even now its purchasing power is not far distant from 300 years ago. Most paper currencies lost more than 98 per cent of their purchasing power in the 20th century alone. Last week gold reached $950 an ounce because the world is losing confidence in all the currencies issued by central banks, but particularly in the dollar. China and India both have a long tradition of hoarding gold, often in the form of jewellery, as a form of personal saving. The Chinese and Indian central banks already have more dollars in their reserve than they can possibly want. They know that the dollar is likely to depreciate over time. They suspect that the Americans will elect an inflationary president. Gold is a defence against inflation.

Posted by drewster @ 12:50 AM 4 Comments

Investment banks are secretly profiting from emergency European Central Bank funding by acting as brokers to funnel billions of euros of much needed liquidity to Britain's banks and building societies.

TELEGRAPH UK: Bankers said that UK lenders were having to access the ECB through the back door

UK lenders with no operations in Europe are particularly at risk of funding problems because they have been struggling to access central bank money.While the ECB has pumped more than $500bn (254bn) into the wholesale funding markets, dropped its penal rate and widened the collateral it accepts as security, the Bank of England has injected just 20bn.

Posted by chris @ 12:46 AM 0 Comments

Interest rate rises cause widespread destruction but don't always deliver a knock-out blow nor are they ever precisely on target.

dailytelegraph: Rises do more harm than good

"It is harsh but you can't get a slowdown in the economy without causing some pain to some people," he said. Macquarie Bank interest rate strategist Rory Robertson said the recent succession of interest rate rises will soon begin to bite in the suburban heartlands of Sydney, Melbourne and Brisbane.

Posted by chris @ 12:35 AM 0 Comments

Sunday, February 24, 2008

Lenders Believe that Houses are Overpriced

Guardian: Homebuyers told to pay 25% deposit or penal interest rate

"Nationwide will tell homebuyers today that unless they have a deposit of 25% or more of the value of a property they will face higher mortgage rates, in the latest illustration of the clampdown on lending caused by the credit crunch." I say the banks are factoring in future house price drops into their mortgage calculations. The boom is well and truly over.

Posted by quiet guy @ 11:50 PM 9 Comments

Hometrack -0.2% in Feb, +1.4%YoY

Daily Mail: House prices continue to drop as boom ends

House prices have fallen for the fifth consecutive month. The average price in England and Wales has dropped to 174,400, nearly 2,000 lower than it was in the autumn. Hometrack said prices fell by 0.2% in Feb, taking the annual rate of house price inflation to just 1.4% The 8% rise in February in the number of new buyers registering with agents was well down on the 25% increases recorded in the same month in the previous two years. The average length of time on the market was 8 weeks, the longest since Hometrack records began in 2001.

Posted by little professor @ 10:57 PM 3 Comments

About money - FED - Interesting

video - google: G Edward Griffin Creature From Jekyll Island A Second Look at the Federal Reserv

The total money scam. The government can only tax it's people so much. So whatever extra money they want, they get the FED to print or ... all create out of thin air. This devalues the dollars you hold in your hand, thus is the inflation tax. RON PAUL IS THE ONLY person in Washington that would guarantee an end to this. This is THE ISSUE OF OUR DAY and our nation hangs in the balance of a MAJOR financial meltdown. The money changers of our day are running short on tricks and we need a return to sound money. Ron Paul.

Posted by stevie dee @ 10:37 PM 0 Comments

Inflation propelled by booming oil prices is squeezing the Gulf's middle class and setting off strikes, demonstrations and occasional riots

international herald tribune: High oil prices take a toll on the middle class in the Middle East

Even as it enriches Arab rulers, the recent oil-price boom is helping to propel an extraordinary rise in the cost of food and other basic goods that is squeezing this region's middle class and setting off strikes, demonstrations and occasional riots from Morocco to the Gulf.

Posted by chris @ 09:49 PM 0 Comments

Do you have Rotten Neighbours?

rottenneighbor.com: A way to anonymously bitch about the jerk who lives down the block

"Rotten Neighbor is the first real estate search engine of its kind allowing you to rate and review good and bad neighbors before and after you move so you can make a smart real estate decision." This is basically an American site but already has some rotten neighbours in London already! But if you complain about your neighbour then it means your own neighbourhood gets a bad rating and makes it harder to sell your house! Slight flawed business model...

Posted by happyrenterz @ 09:05 PM 0 Comments

This isn't a crank!

WORSENING economic conditions appear to be taking their toll on property markets across the eastern seaboard, with weak results in the first major weekend of property auctions.

AUSTRALIAN: House sales hit by economics

Tony Pride of Wentworth Real Estate takes bids in South Melbourne. Picture: Richard Cisar-Wrght Real estate industry figures said clearance rates were falling in Melbourne, Sydney and Brisbane, and that rising interest rates and global uncertainly would stifle price gains this year after a strong 2007. Australian Property Monitors analyst Michael McNamara said the weekend's results revealed an increasingly nervous market that was being buffeted by the higher cost of finance, soaring petrol prices and the prospect of the US leading the world into an economic slowdown.

Posted by chris @ 06:25 PM 0 Comments

Housebuilding collapsing in front of our eyes

Firstrung: New housing sales collapse by 36% as starts fall by 39%

Housing starts were 39% lower at the start of 2008 than the previous year, figures obtained exclusively by Building have revealed. This news comes on the back of Kleinwort Dresdner's advice suggesting "It's payback time for builders" as they issued investment advice to all their institutional investment clients to 'dump' housebuilder stocks without delay. Research by the NHBC showed that there were 9,135 construction starts in January 2008, compared with 14,998 in the first month of 2007. The average number of new homes sold a day dropped to 550, 36% lower than the year before.

Posted by converted lurker @ 03:12 PM 3 Comments

remarkably concise precis in song!!

Youtube: subprime mortgage blues

"This is GREAT! I love it! I laughed so hard because there is so much truth to it all"

Posted by inbreda @ 02:37 PM 9 Comments

(92 per cent) are convinced that estate agents 'do not justify their high fees'

Guardian: Want to sell your house? Try setting up a home page

"we've seen a 94 per cent spike in the number of direct listings of homes for sale,' reports Gumtree's spokeswoman Sophy Silver. 'It reflects a money-saving mood among sellers, especially as house prices now show signs of dipping.'" Everyone - can I suggest that if/when prices are reasonable, and we are all able to buy a place to live, we make an extra special effort to look for houses online rather than through an estate agent. There is even one in the channel islands now - www.guernseypropertyhub.com, which is amazing because we've only just got electricity here ;-)

Posted by inbreda @ 02:28 PM 3 Comments

Another 'bad' news housing and mortgage market over load during the past week

Firstrung: Firstrung, first time buyers, the week in focus

In order to recover and to prevent a massive 'pipeline backlog' of new builds, developers need to find new markets. There is only one new market, the priced out first time buyer. With the average price of a newbuild at 230K and the average price an FTB can afford being approx. 150K, builders need to slash and burn prices by 30-35% to achieve the level of sales they need in order to operate profitably per unit sale. Sitting the market out and keeping a 'weather eye' on the window that is new home sales could prove to be fascinating. There is no under supply of housing, this has been the outstanding perpetual urban myth peddled by the ill informed or mischievous during the house price bubble.

Posted by converted lurker @ 02:23 PM 10 Comments

Cautionary Tales from the Last Recession

The Times: Recession and repossession: surviving a great fall

"In the end, the flat that they had bought for 69,000 was sold by the mortgage company for just 27,000, leaving Tommy and his sister liable to the tune of 47,000 ... Now 43, he works as the manager of a homelessness project, lives in a rented flat and has vowed never to buy a property again."

Posted by quiet guy @ 02:14 PM 3 Comments

Is New Liebour the UK's most corrupt government ?

Telegraph: Council tax bills cover-up exposed

Tens of thousands of householders could have been paying too much council tax for years in a "scandal" that ministers attempted to cover up. Ministers and officials have known since at least 2005 that many homes were placed in the wrong tax bands, with householders paying more than they should. It is claimed that the miscalculations could have affected up to 400,000 homes - and it is still not known how far back the over-payments go.

Posted by uncle chris @ 01:37 PM 11 Comments

A timely article in light of today's other news

This Is Money: Repossession nightmare still haunts me

The return of the scourge of house repossessions brings back painful memories for Grant Derbyshire. As debt charities urge people to take action if they are having difficulty paying their mortgage, Grant, 50, relives the nightmare of losing his home.

Posted by wilee @ 10:55 AM 0 Comments

Usa Turning To Gold

Hiday.net: USA PROPERTY MARKET

At the moment it seems America has a lot more to fear than falling satellite dishes. Many financial commentors agree that the US economy is in a lot more trouble than when the dot.com bubble burst a few years ago.

Posted by john84 @ 10:34 AM 0 Comments

Mortgage borrowers lured by the stricken banks 100%-plus deals will find it almost impossible to move elsewhere

Times: Thousands trapped in Northern Rock loans

Tens of thousands of Northern Rock borrowers face being trapped in mortgages charging punitive rates of interest following the banks nationalisation last week. About 175,000 borrowers are thought to have been lured into Northern Rocks controversial 100%-plus loans over the past few years. They are now likely to find it extremely difficult to remortgage after most lenders pulled out of the market last week. If they stay with Northern Rock, however, they face a huge payment shock with repayments likely to go up by as much as 2,000 a year on a typical loan of about 150,000. The nationalised bank already has one of the highest rates of repossessions of any lender, and the plight of the 100%-plus borrowers could make matters much worse.

Posted by jack c @ 09:12 AM 13 Comments

Britains housing market again described as a pack of cards set to tumble because of reckless lending and overbuilding of flats

Times: Top builders Persimmon and Barratt set to reveal market woes

TWO of Britains biggest housebuilders are expected to trigger fresh worries over the state of the housing market this week by confirming that reservation levels at their developments have plunged by more than 20% compared with a year ago. Persimmon and Barratt, which report financial results this week, are tipped by City analysts to caution that reservation levels have dropped by 20%-30% as buyers struggle to secure attractive home loans following a clamp-down on riskier mortgages. Barratt is offering first-time buyers the opportunity to buy 100% of a property for 75% of the purchase price through an interest-free loan under its Dreamstart scheme.

Posted by jack c @ 08:59 AM 7 Comments

Flippers hand back the keys as crisis spreads

Observer: US house prices plunge into negative equity

More American homeowners are mired in negative equity than at any time since the Great Depression of the Thirties, a signal that the housing crisis has spread to the wealthier middle classes. Over 10% of homeowers owe more on their mortgage than their homes are worth. Bob Corwin bought a condo for $315,000 and spent $365,000 doing it up. It sold for just $290,000. 'Foreclosure is a good option for flippers,' Wyss says. 'If your house is in negative equity and you can't sell it, why should you go on making mortgage payments? It makes little sense. You can just walk away and hand the keys over to the bank.' The worry now is that the US market could be flooded with over 5 million foreclosed houses in the next year, deepening the crisis further.

Posted by little professor @ 08:38 AM 5 Comments

Blair's company gets bearish

Observer: House prices will fall 8% in 2008, and keep dropping

House prices will decline by 6% in 2008, and continue falling next year, as anxious homeowners rush to cash in their gains, analysts at JP Morgan warned this weekend. Just three months after predicting that prices would stagnate, JP Morgan's chief UK economist said the evidence now looked 'pretty bleak'. The number of new mortgages approved (a good predictor of future demand) has fallen for the seventh month in a row, to the lowest level since 1995.

Posted by little professor @ 08:30 AM 10 Comments

A detailed look at the mortgage problems in Cleveland, Ohio

Telegraph: Cleveland: ghost town created by Americas loan scandal

One particular quote caught my eye: "Many homeowners who were struggling with their loans were using equity from their rising house price to refinance their mortgages. With the housing boom over, and lenders tightening their standards, troubled borrowers could end up without the equity they need to refinance their loan or to sell their home and pay off their loans." Sound familiar?

Posted by monty032 @ 08:27 AM 2 Comments

Top builders Persimmon and Barratt set to reveal market woes

The Times: Business Article

Very much something for after the weekend...

Posted by orwell @ 07:45 AM 0 Comments

Saturday, February 23, 2008

Bank Has Hissy Fit After Being Sold CDOs

The Times: Germans accuse UBS of sub-prime mis-selling

"ONE of Germanys biggest financial institutions is to sue UBS, the Swiss banking giant, claiming it was mis-sold hundreds of millions of pounds worth of sub-prime securities. The action is expected to trigger a wave of similar lawsuits across world financial centres as institutions seek recompense for losses incurred from buying complex financial instruments that are now worth a fraction of their original price." I think I can safely say that we will see more of this in future.

Posted by quiet guy @ 11:57 PM 1 Comments

Rightmove says 3.2% rise in Feb..True!!

Rightmove house prices: Rightmove house price report Feb 2008

Am looking to buy a 400K-ish two-bed in zone 3/4 W or SW postcode in London, as baby due in 6 mths. Did one round last Nov and one last week -to discover the asking prices had indeed moved up, by nearly 5-10% BUT only bcos sellers know they have little option but to sell at (sometimes) double digit discount to asking price. So Rightmove's 3.2% headline rise in Feb is yet another 'statistical' ploy by yet another in the 'estate ecosystem' to breathe life in a falling market. In fact, tho most agents were putting on the usual brave story of good demand, bonus time etc - we saw examples of actual drops of 5-8% in asking price by time-bound sellers. And yes, even for decent period property in good locations, Draw ur own conclusions.

Posted by roy @ 10:57 PM 0 Comments

What shall I buy with little lot!

Evening Standard: What crisis? City workers handed 7billion bonuses

Apologies if this has been previously published. Well, you can buy a few "Bargain Buckets" with that amount. Good on them, they have earned it. ;)

Posted by stevie dee @ 08:25 PM 1 Comments

Some light entertainment on a slow news day

Channel 4 - Fone jacker: Internet Service Providings Strange Estate Agent

I don't want to make too many generalisations here as contributions from people like HonestEA (http://www.housepricecrash.co.uk/forum/index.php?showtopic=68544) are greatly appreciated by many people on this website. However, for every prime EA there seem to be a great many sub-prime EAs. This phone wind-up captures one in action telling a call centre worker how to speak English properly and that "the customer is always right". As I said, some light entertainment! ;o)

Posted by francis @ 05:14 PM 0 Comments

The high street sales figures could be misleading the MPC into rate cuts

BBC "News": January sales fever seen online

Online shoppers caught sales fever last month, spending more on the web than in any previous January, figures show.

Posted by paul @ 09:00 AM 2 Comments

Bear Spotted in Clever Money Wood.

The Times.: When it comes to seeking advice on making a fortune in business, take it from Jim Mellon

A highly successful investor worth 620million makes a remarkably bearish statement about the UK housing market predicting nominal falls of 20% in the next few MONTHS. No doubt "the world's greatest newspaper" would place him in the doomsayer rather than the expert camp.

Posted by baudot @ 07:50 AM 0 Comments

Whoopsie

Times: John Lewis shocks retailing with worst sales fall for year

John Lewis sent a shudder through the high street and sparked fresh fears over the health of the British economy yesterday by reporting its biggest sales decline for almost a year. John Lewiss statement came as the AA reported that petrol prices had climbed to a record high, with unleaded petrol rising to 104.49p a litre. Motorists are now spending 500 million more a month to fill up their cars than a year ago and they face a further rise in petrol duty on April 1. George Buckley, the chief UK economist of Deutsche Bank, said: Im afraid that John Lewiss figures are a sign of things to come. Debt repayments are going up, house prices are going down, taxes are at a 20-year high.

Posted by who stole my pension? @ 06:24 AM 4 Comments

A billion here a billion there and soon you run out of money!

Telegraph: Citigroup facing further big write-downs

Citigroup is facing further financial write-downs after revealing it has an exposure of $4bn (2.03bn) to the troubled bond insurance sector and has been forced to move a $10bn hedge fund on to its balance sheet after significant losses. They must be keeping their fingers cross in the hope the bond insurance companies are rescued! The banking conglomerate also warned that further deterioration in the US housing market could lead to further write-downs in its sub-prime and leveraged loan books.

Posted by who stole my pension? @ 05:15 AM 2 Comments

If this rescue fails then their will be a big bang!

Reuters: Ambac rescue may be announced Monday or Tuesday

A rescue for bond insurer Ambac may be announced. Ambac, facing billions of dollars of expected losses from guaranteeing repackaged subprime mortgages, is talking to banks and regulators about raising extra capital to keep its top credit ratings, A deal has not yet been signed, and may still fall through. Investors fear that Ambac will lose its top credit ratings forcing investors to sell billions of dollars of securities and lifting borrowing costs for consumers and city governments. The U.S. bond insurance industry, which guarantees some $2.4 trillion of debt, is broadly looking to raise new capital and reorganize as expected losses have mounted. Rescuing or restructuring bond insurers is difficult.

Posted by who stole my pension? @ 05:10 AM 3 Comments

Friday, February 22, 2008

Deconstructing the Rightmove "bounce"

The Times: Misleading house price spike

With the economy teetering on the brink of recession and a massive slowdown in mortgage lending already under way, house prices jumped by an astonishing 3.2 per cent last month, according to Rightmove, the estate agency website. But what is behind this gravity-defying leap in the cost of housing?

Posted by little professor @ 10:46 PM 5 Comments

BTL Properties turned into Cannabis Factories

BBC: Homes turned into 'drug factories'

"You have well-dressed, respectable people going around to local estate agents and renting property. Nothing seems particularly out of the ordinary about that." Tenants usually pay their rent up to months in advance before knocking down walls, installing heating and lighting then disappear after the harvest, leaving houses in disrepair and landlords facing unpaid electricity bills of up to thousands of pounds.

Posted by enuii @ 09:47 PM 10 Comments

The Mash has a giggle at Tesco

The Daily Mash: PUT UP THE PRICE OF EVERYTHING, SAYS TESCO

Sir Terry Leahy said legislation was necessary to double or treble the cost of all things in shops, except for wages which were already high enough.He said the low cost of eggs was fuelling an egg frenzy across the nation, making many town centres no-go areas at the weekend because of binge-scrambling. "No one is against the responsible use of eggs, one or two a day with meals, but we're now seeing an alarming rise in the number of young people who are making their own mayonnaise."

Posted by tick tock @ 08:17 PM 0 Comments

Bearish...no bullish ...erm

Reuters: US STOCKS-Dow, S&P 500 turn up on report on Ambac

Well after what can be politely described as a volatile week in the FTSE, the late grey market is showing some rises on this latest piece of news that CNBC is leaking. Have a great w/end!!!

Posted by techieman @ 07:50 PM 0 Comments

The price of new build flats are heading for a "full scale crash"

Telegraph: Price of new build flats 'set to crash'

The price of new build flats are heading for a "full scale crash", causing misery for tens of thousands of buy-to-let landlords who gambled on an ongoing property boom, writes Paul Farrow. According to Dresdner Kleinwort Wasserstein "reckless lending and over-building of flats threatens recession because a bubble had been stoked "by highly speculative (and potentially highly suspect) development, lending and valuation practices which have led to over-supply of flats in cities across the country, most notably Leeds". Flats rose from 21 per cent of all housing starts to 49 per cent in Q3 2007. Tellingly, said Dresdner, it fell off in Q4, supporting suggestions from, among others Housepricecrash.co.uk, that a number of higher density city centre sites could be 'mothballed'.

Posted by jack c @ 04:56 PM 19 Comments

No limits to US tax rebate money creation

Safe Haven: Why Inflation Will Trump Deflation (Reasons 1-2)

No limits to US tax rebate money creation.

Posted by sold 2 rent 1 @ 03:28 PM 8 Comments

Economists warn on output/inflation trade off, but play down fears of 1970s' scourge

FT: Experts claim UK is suffering 'stagflation'

The UK is now experiencing a mild form of stagflation, experts have claimed. Stagflation - a combination of a stagnant economy and high inflation - was the scourge of the global economy in the 1970s.Ross Walker, UK economist at RBS, said: "What we have now is nothing like the 1970s, but by the standards of the last decade, we have above-target inflation and slowing growth. "The output/inflation trade-off has deteriorated. For a given amount of growth in the economy, there is more inflation."Mr Walker was commenting after the Bank of England published its February Inflation Report last week.It predicted UK growth would slow sharply to less than 2 per cent by the end of the year.

Posted by jack c @ 03:10 PM 5 Comments

Bank's doing nicely

Evening Standard: Lloyds TSB dodges crisis

Britain's fifth-largest bank has nailed its colours firmly to the retail market. That helped push up profits by 6% last year to 3.92 billion with a relatively modest 280 million loss on its involvement in subprime-related investments.

Posted by yoyo1 @ 02:20 PM 2 Comments

Question Time : Northern Rock special

BBC: Question Time

Ruth Kelly in a right mess. Vince Cable murdered her. The truth is coming out about the over inflated housing bubble.

Posted by doomwatch @ 02:14 PM 8 Comments

VI admits "We expect house prices to continue to decline - as previous cycles have indicated - before reaching a plateau."

Telegraph: Humberts crisis may trigger estate agency consolidation

Humberts Group, the estate agency and surveyor that is part-owned by property tycoon Vincent Tchenguiz, has swung to a full-year loss, taking a 18.4m hit as Britain's once booming property market grinds to a halt. Executive chairman John McLean said today: "We are battening down the hatches. "The business needs to be streamlined for when the housing market improves."We expect house prices to continue to decline - as previous cycles have indicated - before reaching a plateau."

Posted by jack c @ 01:43 PM 10 Comments

Do you remember the changes to miras tax relief in Aug 88? what happened next?

msn: win-win for landlords under new capital gains tax laws

And if the property market remains stable for the moment, some property investors will be tens of thousands of pounds better off if they decide to sell their property after April 1 2008. Even if investors decide to ride out the market uncertainty the opportunity to maximise and profit from their rental yields leaves landlords in a win-win situation.

Posted by sold out @ 01:38 PM 13 Comments

There are now no lenders offering a combined mortgage and unsecured loan range with the potential value of up to 125 per cent LTV

Moneymarketing: BM Solutions last lender to quit 125% arena

BM Solutions has confirmed it will be withdrawing its Mortgage Plus product after every other lender in the 125 per cent loan to value market pulled out this week. This comes after Alliance & Leicester, Abbey, Coventry Building Society and its subsidiary Godiva Mortgages all announced their withdrawal from the market on Tuesday. Northern Rock was quick to follow with confirmation yesterday that it would be withdrawing its Together range from the end of play.

Posted by jack c @ 01:35 PM 4 Comments

But the sun will never set

Guardian: Mortgage lenders at risk of falling into credit-rating trap

Fitch does "not expect a collapse in UK house prices." They also do not expect the sun to set this evening, adding that such predictions are overly pessimistic given the sound astronomic fundamentals and the lack of visible evidence that the world is still turning.

Posted by letthemfall @ 01:01 PM 0 Comments

Shop a BTL tax dodger today

HMRC: HM Revenue & Customs Tax Evasion Hotline

"HMRC is committed to targeting tax evasion. We know some people don't pay their fair share of tax, which is unfair for the rest of us. Now you can help us do something about it. The Hotline can take your call on 0800 788 887 (Lines are open Monday to Friday 8am to 8pm, Saturday and Sunday 8am to 4pm)"

Posted by doomwatch @ 12:57 PM 8 Comments

Tax crackdown on buy-to-let landlords

Guardian: Tax crackdown on buy-to-let landlords

My heart is bleeding. I wonder if there is a snitch phone number (like for benefit cheats) number to wipe out the smug dinner party boats ? "Buy-to-let investors who have not paid tax on money made from letting or selling a property are to be targeted in a major crackdown that accountants say will net millions of pounds for HM Revenue & Customs."

Posted by doomwatch @ 12:09 PM 12 Comments

Does it matter if London house prices fall?

MoneyWeek: Does it matter if London house prices fall?

I'm sure our fan Anne Ashworth thinks it matters. I'd love to see Merryn & Anne debate this on TV; my money would be on the true expert, as opposed to the buy-to-fret hack.

Posted by doomwatch @ 11:18 AM 0 Comments

Expect the government bail outs to continue

MoneyWeek: Expect more government meddling with banks

We should expect even more government meddling (a la Northern Rock), begged for by the finance industry and willingly supplied by policy-makers desperate to appear decisive. And for as long as this circus keeps rolling on, you might want to keep buying gold as defence...

Posted by damien @ 10:58 AM 0 Comments

Revenue launches crackdown on buy-to-let landlords

The Guardian: Revenue launches crackdown on buy-to-let landlords

Poor old BTL'ers must feel everybody is against them these days!

Posted by becky @ 10:54 AM 7 Comments

Inflation is only going to get worse...

FT: Gold nears $1,000 as stagflation fears grow

Bullish gold price forecasts...

Posted by doom&gloom @ 10:07 AM 22 Comments

Something evil this way comes..............

Telegraph: Severe US recession may already be underway

''...A severe recession may now be under way in the United States, according to a closely watched economic barometer. The Philadelphia Fed warned late yesterday that the manufacturing sector in the key heartland of the US is suffering its lowest output for seven years - a firm sign that the world's biggest economy is now shrinking, experts said....''

Posted by hpwatcher @ 10:04 AM 4 Comments

Short and 'sweet' - momentum in house prices

Financial Times: The Short View: Housing market momenum (sic!)

Momentum, we know, is a powerful force from politics to securities markets. But it could be at its most damaging in the housing market.

Posted by james @ 09:19 AM 1 Comments

Northern Rocks charts for repossessions

Firstrung: Northern Rock tops repossession league table

With 690 claims in the month of February alone the Northern Rock actions dwarf those of, for example, Nationwide and HBOS, who do not feature in the top twenty. This also represents an approximate 50% increase vis a vis feb 2007 when NR issued 458 possession claims. Even more worrying for UK mortgage lenders as a whole is that 17,565 possession actions were entered into court in the single month of February after a staggering 22,082 in January*. As a direct comparison, (vis a vis 2007), during the fourth quarter of 2007 a total of 35,662 mortgage possession claims were issued on a seasonally adjusted basis in that three month period. 46% of these mortgage possession orders were suspended.

Posted by converted lurker @ 09:09 AM 4 Comments

Exclusive

Guido Fawkes: The myth of the "quality loan book"

Alistair Darling and Gordon Brown chant the same mantra, the government's investment is backed by the assets of the Northern Rock, "a high quality loan book", which they claim has been verified by the FSA - as if the FSA employs surveyors and has the competence to take a view. Anatole Kaletsky said this was a delusion. Now Guido has the numbers to prove it. In February NR had the highest rate of repossessions of any mortgage lender, averaging 40 every working day.

Posted by little professor @ 08:30 AM 12 Comments

The latest housing report reveals that governments are spending $4 billion every year on housing assistance programs and the number of people needing help is on the rise.

ABC news: Housing stress on the rise: AIHW

AIHW spokesman David Wilson says the figures show the cost of housing and the shortfall in supply is creating housing stress for many Australians, and for some of those people, the assistance is not easing any pressure. "The figures indicate there's more households facing household stress just due to the shortage of housing, rising house prices and generally difficulty in meeting rent payments by some households," he said.

Posted by chris @ 04:21 AM 0 Comments

Thursday, February 21, 2008

Spliced, diced and Securitised to the tune of 49bn

Times: Northern Rock's links to Granite could increase risk for taxpayer

Spliced and diced via Granite, "if Northern Rock decided to terminate its relationship with Granite then the stricken bank would be in very difficult waters indeed.

Posted by enuii @ 10:41 PM 4 Comments

The ice age is coming the sun's zoomin in

Firstrung: UK house prices crash in certain areas of the UK in final quarter of 2007 - Land Registry

The latest fourth quarter Land Registry statistics have shown that house prices in certain areas of London have crashed in the last quarter of 2007. These prices could be the first indcation that the much discussed 'credit crunch' has finally begun to eat away at house prices in areas that were previously deemed to be impregnable.

Posted by converted lurker @ 07:35 PM 17 Comments

Housing experts warned yesterday that the home affordability crisis threatens to destabilise the economy and drive the country into recession

smh: Skipping meals to pay rent RISING rents are forcing thousands of people to skip meals and admit they are too poor to send their children on school excursions, new figures reveal

Many home owners pay their mortgage by taking second jobs, but Professor Burke said "any economic slowdown means they could lose those jobs, and then you have thousands who are going to be in trouble. I suspect we are approaching that situation."Professor Mike Berry, an economist and urban planning expert from the RMIT University in Melbourne, told the conference that when the property boom slows, house prices in less-favoured areas will fall.

Posted by chris @ 07:03 PM 0 Comments

Will we experience Japan's 'lost decade'?

MoneyWeek: Is America heading for a Japan-style crisis?

In the 1990s, Japan struggled with a burst credit bubble, fast-falling asset prices and a near-bankrupt financial sector. Now the US is heading in the same direction. And Britains economy is also in more trouble than most...

Posted by damien @ 06:21 PM 5 Comments

Evanomics blog

BBC News: Migrants go home

...And away from the labour market, think about house prices! At a time when they are falling, a reduction in migrant numbers might intensify the difficulties faced by buy-to-let investors, and the market as a whole.

Posted by dam1an @ 04:34 PM 3 Comments

Why did it take so long?

BBC: Northern Rock halts 125% mortgage

"The flagship offer from the bank will be closed from 2000 GMT. The deal lets customers borrow up to 125% of the value of their homes and has been criticised for encouraging people to take on large debts".

Posted by alan @ 04:11 PM 11 Comments

Stupid EA led article

Evening News: Slump won't hit city says estate agent

Summary of Article; Journalist; Will property go up forever and ever? EA; Of course it will. Some papers are scraping the bottom to keep the bubble inflated

Posted by geed @ 04:06 PM 4 Comments

ching ching

Greenbay: lease back scheme

i went to a landlord meeting yesterday concerning a lease back scheme being offered to landlords, they basically offer landlords a five year contract where they guarantee rent upfront every month without any void periods regardless if the property is tenanted, they guarantee any damage is covered etc etc and deal with all tenants basically totally handsfree for the landlord plus there is get out clause with six months notice if i required any of the properties back. The rents are very good in terms of property prices around the newport area for example a 3 bed terrace they will give a net value of 525 per month and they range from 80000 upwards. so i must say im looking to purchase a few more and likewise the feeling im getting is many other landlords are doing the same....

Posted by greenbay @ 03:20 PM 13 Comments

Peers vote for Audit of Rock and that it should not be exempt from FOIL

BBC: Government suffers Rock defeats

The government has suffered defeats in the House of Lords over parts of its plans to nationalise Northern Rock. Peers have voted for an independent audit of the bank's books within three months, followed by annual checks. They also voted against plans to exempt the bank from Freedom of Information laws. Once peers finish debating the bill it will return to the Commons. Ministers will have to decide to accept any changes peers make - or reject them and send the bill back to the Lords.

Posted by jack c @ 03:02 PM 11 Comments

House of Lords says NO to NR nationalisation

Times Online: Government defeated over NR nationalisation plan

Darling and Brown's cunning plan foiled by dastardly ermine-clad aristos... who would have thought inherited wealth would have come to the rescue of hard-working taxpayers and savers??? This is getting interesting...

Posted by an bearin bui @ 02:51 PM 1 Comments

A bit technical but worth a read. The gist of it points to a hammer-blow in the credit markets.

Bloomberg: Auction-Rate Debt Succumbs to Bid-Rig Taint as Citigroup Flees

The collapse of the auction-rate bond market, where state and local governments go to raise cash, demonstrates that regulators are no match for Wall Street. Hundreds of auctions have failed this month, sending borrowing costs as high as 20 percent because dealers from Goldman Sachs Group Inc. to Citigroup Inc., UBS AG and Merrill Lynch & Co. stopped using their own capital to support the sales. Regulators, who allowed the manipulation of bids and lack of information to persist even after two probes in the past 15 years, are now watching a $342 billion market evaporate at the expense of taxpayers.

Posted by tyrellcorporation @ 01:59 PM 1 Comments

Alliance & Leicester effectively pulling out of the mortgage market

Mortgagesolutions: A&L to scale back mortgage offering

Alliance & Leicester (A&L) is retreating from the mortgage market after revealing it had suffered 185m losses in the wake of the credit crunch, knocking 30% off last years profits. Following the news of the losses, shares slumped to a record low of 428p yesterday and were 472p at the time of going to press. The problems have forced the bank to cut back its lending, with Chris Rhodes, acting finance director, revealing A&L would concentrate on keeping its existing customers during the coming year rather than seek out new borrowers by offering market-leading mortgage rates. In yesterdays trading statement, Rhodes commented: We expect net new mortgage lending to be negative this year. We expect to concentrate on customer retention."

Posted by jack c @ 01:34 PM 14 Comments

House building stocks get demolished

MoneyWeek: House building stocks get demolished

Its refreshing when you see an analyst really laying into something. And thats exactly what Dresdner Kleinworts Alastair Stewart did to the housebuilders' stocks yesterday. Forget about a soft landing for property. Housing demand has been entirely a function of the amount of money available to borrow to pump into property. That availability isnt diminishing slowly its been pole-axed by the belated realization stemming initially from the US - that borrowed money has to be paid back sometime. And that means demand will collapse.

Posted by damien @ 10:56 AM 6 Comments

The roof is caving in on this dreamy world of loft-style living

Times: Apartment walls will come tumbling down

There just arent enough affluent young urbanites to buy or rent all this new space without big price falls. Ipswich, bluntly, is not Manhattan. Moreover, the boom of the past few years has been fuelled not only by reckless bank lending but also by a conspiracy of acquiescence between developers and valuers at best and, in many cases, downright fraud. That is likely to make the ensuing bust all the more painful.

Posted by jack c @ 09:37 AM 7 Comments

Gold hits 946 and ounce

Safe Haven: Gold & Whirlwind of Crisis

The gold & silver prices will rise from the cheap money, low interest rates, stimulus packages to ward off recession, rescues to banking, and lower USDollar. But the USEconomy desperately needs the next Policy Bubble in order to come back to life, to produce jobs, to change national psychology, to revive hope. Without a plan to puff a new bubble, which will buy some years of time, the nation will morph into chaos. A military dictatorship would be the only alternative. The urgent next step is leaders with some vision, rather than a plan for private profiteering, founded upon fear. Hope pays off more than fear, unless fascism is the end game.

Posted by sold 2 rent 1 @ 09:22 AM 27 Comments

Slow news day...

The Sun: I'm going Batty for Wembley

JONATHAN WOODGATE is being driven Batty because he cannot find a decent-priced house to buy in London. The Spurs millionaire centre-back's only problem so far has been finding a pad for himself and his girlfriend. He said: Im still living in an hotel. We have looked at houses and its a lot more expensive than it is up north. House prices are a joke, its unbelievable. But thats London. Hopefully, I can find a house and get settled. You just want the right place. Its expensive for everyone. You dont want to be blowing stupid money on a house.

Posted by little professor @ 08:20 AM 8 Comments

High house prices and a rubbish standard of living - thanks NuLabour!

Telegraph: Biggest brain drain from UK in 50 years

No other nation is losing so many qualified people, it points out. Britain has now lost more than one in 10 of its most skilled citizens, while overall only Mexico has had more people emigrate.

Posted by tyrellcorporation @ 08:18 AM 27 Comments

Balanced view of UK property market

Citywire: Property: The diversity and detail beyond the property headlines

Hysterical media claims of a looming recession tend to tar the entire UK property market with the same brush. An economic low, yes, but different regions have seen contrasting fortunes that cannot be lumped together, argues Richard Sexton of e.surv. Those with a need to understand their particular area of the market appreciate that it is highly granular, with significant variety across small geographical distances. Those who doubt this should consider that valuers and agents operate in areas which can be less than three square miles. This is the level at which predictions become useful.

Posted by jack c @ 08:10 AM 2 Comments

Hot News: Greed is Bad !

Torygraph: Landlords, not retailers, kill communities

Of the commercial, rather than residential type, but considering that most people never get past the headlines it just adds to the drip, drip, drip of sentiment change.

Posted by ski @ 08:08 AM 3 Comments

Toxic Mortgage Hangover for A&L

Guardian: A&L to reel in mortgages after 30% drop in profits

Acting chief executive Chris Rhodes issued a stark warning to consumers that the cost of mortgages is going to rise regardless of any official cuts to the Bank of England base rate and that they needed to keep a clean credit record if they wanted to be granted a loan in 2008.

Posted by quiet guy @ 12:55 AM 4 Comments

Greed turns to fear

Times Online: UK housing market close to collapse, analyst says

Britains housing market is a house of cards that is set to implode after years of reckless mortgage lending, chronic oversupply of new flats and widespread fraud, a leading analyst said yesterday.

Posted by bloke111 @ 12:35 AM 3 Comments

Wednesday, February 20, 2008

Lenders in a tailspin

MSE: Recap of last 24 hours news

A mortgage advisor writes: "Just to add to an absolutely horrific day.. I'm sick of it, every day I get a redundancy email, a lenders gone bust email, or we are not doing high LTV/self certs/BTL's anymore email. Makes my job an absolute nightmare. If lenders retract much further we will only be lending to super clean prime full status clients and there will be a lot of people looking to rent!" In the past day: Alliance and Leicester and Abbey pull all their 100%+ LTV deals, followed shortly afterwards by Coventry and B&M, leaving only NR. Picture Loans closes to new business ("temporarily") LMS mortgage packagers goes into receivership And Platform mortgages, the sub-prime arm of Britannia, sacks 20% of its workforce.

Posted by little professor @ 08:14 PM 10 Comments

Breathtaking description of how the disaster was allowed to develop

CNN: Loans failing pre reset

Unbelievable situation where banks knew they were taking on bad debt but could 'securitize' it so they didn't care. Deeply perverse.

Posted by last_days_of_disco @ 07:59 PM 0 Comments

Stuart Law "Downturn in recent months is simply part of a stabilisation process and not a market crash as has been touted by some.

MortgageSolutions: Assetz results reveal extent of house price slowdown

The extent of the recent house price slowdown has been reflected in the latest results of the Assetz House Price Watch, revealing a marked decrease on this time last year.

Posted by jack c @ 04:28 PM 17 Comments

Coming to a store near you!

BBC: China inflation hits 11-year high

Chinese inflation hit an 11-year high in January after rising price pressures were exacerbated by fierce snow storms, official figures show. Soaring food prices were largely blamed for pushing consumer inflation up to 7.1% last month, from 6.5% in December.

Posted by tyrellcorporation @ 03:38 PM 7 Comments

Estate agents describe a shed as a "detached single- storey timber-built bungalow with vehicular parking to the front"

icWales.co.uk: Dilapidated shed on market at £150,000

"IT'S partially covered in plastic sheeting and even the estate agent trying to sell it admits it's 'dilapidated'. But this rundown shed in a top Welsh property hotspot has gone on the market for £150,000.Though based in the plush beach resort of Abersoch, in Gwynedd, the shed does not boast the kind of dramatic sea views that have seen similar properties marketed for up to £500,000. But estate agents Beresford Adams say that despite the absence of a stunning panorama, the shed has already attracted three bids in excess of the £150,000 asking price. A spokesperson even hinted a bidding war could drive up the price to around £175,000 before a deal is reached.The building's dimensions are just 18ft by 15ft, though it does have water and electricity supplies."

Posted by jack c @ 03:13 PM 6 Comments

Rock rubbish? Oh, you mean all the SUBPRIME stuff.

BBC "News": Taxpayers to get Rock rubbish

Yes, its that word again whose name they dare not speak. When does an asset cease to be prime and start to be subprime exactly??

Posted by paul @ 01:49 PM 13 Comments

More Good News from the States

CNN: Prices jump more than forecast - Report shows inflation remains persistent, with annual rise of 4.3%.

The pace of inflation rose in January, according to a closely watched government report Wednesday that showed price pressures were higher than Wall Street expectations. The Consumer Price Index, the government's key inflation reading, rose 0.4% in the month after a 0.4% jump in December. Economists surveyed by Briefing.com had forecast a 0.3% rise in January. BBC Headline for this "US inflation AT 0.4% in January."

Posted by stevie dee @ 01:45 PM 1 Comments

Race to the bottom (2)

BBC: Death knell for 125% mortgages?

Wot? They're phrasing that as a question?

Posted by mark wadsworth @ 01:20 PM 2 Comments

Race to the bottom

guardian: Three lenders scrap 125% mortgage deals as criticism increases

Three mortgage lenders yesterday pulled the plug on deals that allow home buyers to borrow as much as 125% of a property's value - the day after Northern Rock came under fire for offering similar deals.

Posted by inbreda @ 01:15 PM 2 Comments

12 Steps to Financial Disaster

FT: Americas economy risks mother of all meltdowns

This article discusses Prof Nouriel Roubinis '12 steps to financial disaster', which describes the sequence of events that he thinks will lead from 'Step 1: the worst housing recession in US history' to 'Step 12: a vicious circle of losses, capital reduction, credit contraction, forced liquidation and fire sales of assets at below fundamental prices'...

Posted by henscu @ 12:39 PM 2 Comments

House prices fall FURTHER

financemarkets.co.uk: House prices fall 1.57% in January

"During January house price actually recorded a 1.57% fall across the whole market. ... Mr Amlt believes that Februarys further rate cut is unlikely to have any real impact on the weakening housing market."

Posted by doomwatch @ 12:29 PM 15 Comments

Cost of new mortgages: Up, down, up, down......

Telegraph: BoE's housing expert warns of shock rise in mortgage bills

''Many homeowners are facing a "significant" shock in the coming months as they experience a sudden leap in their mortgage bills, the Bank of England's housing expert has warned.''

Posted by hpwatcher @ 12:22 PM 1 Comments

The best contrarian indicator of all: the Labour government

MoneyWeek: The best contrarian indicator of all: the Labour government

The Labour government is fast becoming one of the great contrarian indicators in the history of markets. After selling gold at the bottom of the market, they buy an insolvent mortgage lender at the top of the housing market. Are they really this incompetent?

Posted by damien @ 11:53 AM 19 Comments

House Prices are UP again according to Rightmove and damn those HIPS for prices being adjusted

MSN Money Investing Article: House Prices Enjoy Boost

House prices surged ahead by 3.2% during the past month as the market enjoyed an exaggerated seasonal bounce, new figures show. The average cost of a home in England and Wales rose by more than 7,400 during the four weeks to February 9 to stand at 237,856, according to property website Rightmove. But the group cautioned against reading too much into the survey, saying that while there were signs of renewed optimism among sellers, the figure was likely to have been distorted by the final rollout of the Government's controversial Home Information Packs.

Posted by mou @ 10:30 AM 7 Comments

CML expects lower lending volumes in the coming months, driven mainly by remortgaging

BBC: Mortgage lending lift in January

Gross mortgage lending rose in January despite an unsettled housing market, according to the Council for Mortgage Lenders (CML). The CML said lending increased to an estimated 26.5bn in January, up 11% from 23.9bn in December, but still lower than most months in 2007. Yet the CML warned gross lending volumes were expected to be lower in the coming months, following a fall in mortgage approvals towards the end of last year.

Posted by jack c @ 10:25 AM 2 Comments

The average price of a house in Northern Ireland has fallen by 20,000 in a QUARTER....but still no crash!!

BBC News: House prices drop as boom slows

"The end of 2007 saw prices drop so that the average house was worth 230,000 compared with a peak last summer of 250,000." Prices in Belfast - currently less affordable than London or Sydney and in the list of 10 least unaffordable cities on the planet - have dropped by about 13% in a quarter, but apparently there's no crash. The reason? Well apparently (according to the author of this survey on the radio) a drop of a few more % - no doubt bringing Belfast on a par with London and Sydney - will make property 'affordable' again for buyers. Also, it's those 'strong fundamentals' again - the world economy has no effect on us - hadn't you heard that Belfast is the new Monaco?

Posted by shipbuilder @ 10:01 AM 8 Comments

Loving the bubble...

BBC: Bank voted 8-1 for cut to 5.25%

''The Bank of England's rate-setting Monetary Policy Committee (MPC) voted by 8-1 to cut interest rates to 5.25% earlier this month, minutes have shown.''

Posted by hpwatcher @ 09:55 AM 9 Comments

A&L's exposure to subprime....

Times Online: Alliance & Leicester profits drop by almost third

''Alliance & Leicester reported a 30 per cent fall in profit last year after being hit by a 185 million writedown on its investments in the credit market. ''

Posted by hpwatcher @ 09:00 AM 1 Comments

12 - steps to financial disaster

FT: America's economy risks the mother of all meltdowns

Martin Wolf of the FT has a look at the case for a economic meltdown. He considers the work of Nouriel Roubini of New York University's Stern School of Business who correctly predicted a hpc led recession. Roubini laid out "12 - steps to financial disaster" many of which are already well underway. I have put a Yahoo hosting of this article link here because the FT one is only available to subscribers.

Posted by happyrenterz @ 08:39 AM 15 Comments

Nothern Crock says it has reformed!!

Telegraph: Northern Rock borrowers told to go away

Northern Crock has told independent financial advisers to encourage homeowners who are remortgaging to obtain loans with other banks. Melanie Bien, director of mortgage broker Savills Private Finance, said: "Northern Rock is encouraging existing clients to go elsewhere. We have had them come to us, saying that for people at the end of their deals they do not want the business any more. They just want to be a savings bank." In the past few weeks that Rock has written to existing borrowers whose deals are due to expire, offering no new competitive loans to renew borrowings and instead advising them to speak to an IFA about mortgages elsewhere. Well better late than never. Although I am not sure what the other banks will say if the Crock nicks all there savings customers!

Posted by who stole my pension? @ 05:56 AM 7 Comments

Does the Government fears that other banks will go bust?

Telegtaph: Alistair Darling accused of Northern Rock Freedom of Information cover-up

The Chancellor took the unusual move of introducing small print into emergency legislation yesterday to prevent public scrutiny of the bank, which has been nationalised, MPs were forced to vote on the nationalisation yesterday, despite being kept in the dark over what public ownership will entail. George Osborne, the shadow chancellor, said last night: "The public is now paying for this bank, so we are entitled to know what it is doing with our money. The legislation allows the Government to nationalise any financial institution - raising fears that ministers may know that other banks are in trouble. Just what are the government trying to cover up?

Posted by who stole my pension? @ 05:49 AM 3 Comments

Say goodbye to 100%+ LTV

The Times: Borrowers on 125% mortgage deals face big jump in repayments

Thousands of borrowers on 125% mortgage deals will be forced to pay hundreds of pounds more in monthly repayment bills after most of the lenders offering these loans withdrew from the market yesterday. The credit crunch and stalling house prices have forced four leading lenders (A&L, Abbey, Coventry BS and Godiva) to stop offering 125% mortgage deals. Another lender said that its deals were under review, which could leave Northern Rock as the only lender still offering this type of loan. The mortgages typically offered 95% of the value of a home as a traditional mortgage, plus another 30% as an unsecured personal loan. There are fears that some home-owners will be unable to find a similar offering when their current deal ends.

Posted by little professor @ 12:17 AM 5 Comments

Tuesday, February 19, 2008

GRANITE - this could cause a bit of a headache!

Telegraph: The state of Northern Rock: anything but unusual

"At Northern Rock's heart is Granite, a 45bn securtisation vehicle though which mortgages are parcelled up and sold to investors. Under "substitution clauses" in Granite, investors can call in their loans if maturing mortgages are not replaced with new ones. Should the clauses be triggered, investors could demand their funding back - potentially leaving the Government with an immediate 45bn bill."

Posted by blister soul @ 11:12 PM 0 Comments

Half the UK have financial concerns ....

Guardian: Economic confidence plummeting, poll shows

A sharp drop in economic confidence is hitting poorest people hardest, according to a Guardian/ICM poll. The poll shows that economic optimism has fallen away since the start of 2008, with a majority of voters (51%, up from 45%) now worried about their financial circumstances and the cost of living.

Posted by uncle chris @ 10:40 PM 3 Comments

The Exchange says it reported eight instances of suspected insider trading to ASIC in January, a big increase on the 20 it reported during all of last year.

sky news: Insider trading rife Australian stock market

New research has found insider trading in the Australian stock market is so rife that it is weakening the reputation of the local bourse. The Australian Securities Exchange is under pressure to boost resources to crack down on the practice, which could include $1 million insider trading fines and bans. Senior executives at two investment banks say insider trading has become part of the system, with regular lifts in the share price of takeover targets in the days before any official announcement. The revelations are the latest blow to the ASX which is already reeling from wildly volatile trading, following the collapse of stockbroker Tricom and questions over risky investments such as CFDs.

Posted by chris @ 09:38 PM 0 Comments

What will be the knock-on effects of this baby?

CreditFlux: Cohen CDO hits event of default

Moody's announced yesterday that it has downgraded ratings of seven classes of notes issued by Kleros Real Estate CDO III, and left on review for possible further downgrade ratings of three of these classes of notes. Moody's said the rating actions reflect deterioration in the credit quality of the underlying portfolio, as well as the occurrence on 31 January 2008, of an event of default. Among the tranches downgraded were the class A1b notes, which went from Aaa to Caa2. Kleros Real Estate CDO III is backed primarily by a portfolio of structured finance securities. The transaction is managed by Cohen & Company's Strategos Capital Management.

Posted by lvmreader @ 09:15 PM 0 Comments

Hedge Funds Have A Lot To Answer To - Its A Right Mess They Have Got Us Into With Their Greedy Ways

streetwise: Care to Dance the Contango?

Care to Dance the Contango? Any time that commodity prices reach highs or lows, speculators are invariably the culprits. Todays energy market is no exception. Many commodity market commentators have been quite upfront in their assertions that current high energy prices (and metals prices too) are due to speculative excess, rather than supply and demand conditions. Now the Senate Permanent Subcommittee on Investigations has endorsed these views (and given them substantial credibility) in a just released a report claiming that fundamental supply and demand conditions cannot explain current high oil prices, and asserting that speculative activity is to blame instead.

Posted by chris @ 09:06 PM 0 Comments

One of the biggest and most practical concerns now revolves around a seemingly simple question: who is about to be hit next with subprime pain?

FT.com: The $280bn question: where are the rest of the subprime bodies?

When finance ministers from the Group of Seven nations gathered in Tokyo last weekend, the mood was distinctly gloomy. With credit stresses spreading, policymakers agreed that the financial outlook looked distinctly uncertain.

Posted by chris @ 08:37 PM 0 Comments

Well done to the BBC

BBC: House price 'threat' to economy

Kate Barker, a member of the Bank of England's Monetary Policy Committee, warned that the bank would not be able to stop this in the short term. Therefore, she said, the MPC would be paying particularly careful attention to the financial and property markets. But rate cuts would be hard to justify in the face of inflationary pressures. p.s. Great! Dispatches documentary last night.

Posted by stevie dee @ 08:17 PM 22 Comments

US Fed buys the garbage collateral nobody else wants

The FT: US banks borrow $50bn via new Fed facility

"The TAF ... allows the banks to borrow money against all sort of dodgy collateral, says Christopher Wood, analyst at CLSA. The banks are increasingly giving the Fed the garbage collateral nobody else wants to take ... [this] suggests a perilous condition for Americas banking system.

Posted by sold 2 rent 1 @ 06:51 PM 1 Comments

Like shooting fish in a barrel - big fish like RAB and SRM

Bloomberg: Hedge funds pocket 'easy' gains on Northern Rock nationalisation

Small shareholders demand a 'fair' price of 425p/share. "Is he having a laugh". The only way to make money out of The Crock is to bet against it.

Posted by bystander @ 05:20 PM 0 Comments

Ron Sandler, the Rock's new boss, is a non-domiciled South African who pays tax in the UK only on his UK earnings.

BBC: Rock bill going before Parliament

MPs have begun debating the nationalisation of the Northern Rock, as it emerged the bank's new chief executive is a non-dom. Ministers want to put the troubled bank into "temporary public ownership" in the hope of finding a long-term buyer. This has prompted Tory calls for Chancellor Alistair Darling to resign. Meanwhile the BBC's Robert Peston said Ron Sandler, the Rock's new boss, is a non-domiciled South African who pays tax in the UK only on his UK earnings.

Posted by jack c @ 03:57 PM 6 Comments

CML says everything is fine

BBC News: Mortgage rate rise 'shock' fades

FSA says 1.4 million mortgage holders will see their teaser rate deals expire this year, but CML argues they will all get great new fixed rate or tracker deals. So that's OK then! How this argument that everyone will get good new deals matches up with the expectation that Northern Rock is to put up rates to get rid of half of its 800,000 mortgage customers I don't know.

Posted by ontheotherhand @ 03:37 PM 13 Comments

Bradford & Bingley on credit watch with negative implications

Mortgagestrategy: Standard &Poorss puts Bradford & Bingley on credit watch

Standard & Poor's has put Bradford & Bingley on credit watch with negative implications. The ratings agency says the credit watch on B&Bs A-1 short-term counterparty rating is due to rising impairments, potential margin pressure and further markdowns as well as continuing funding constraints. Nick Hill, credit analyst at S&Ps, says these factors may not be consistent with the current rating. Standard & Poor's has put Bradford & Bingley on credit watch with negative implications.

Posted by jack c @ 03:20 PM 1 Comments

Northern Rock will result in higher interest rates

Market Oracle: Northern Rock Bank Nationalised- Which Bank will be Next?

Which other banks will follow Northern Rock? There will be further failures as the credit crisis is deepening. The US monoline insurers face failure thus magnify the original estimates of bank losses potentially ten fold ! The prospects for the UK mortgage sector looks dire, with the UK housing market having barely begun to feel the impact from the credit crisis (see graph in article). Mortgage banks such as Bradford and Bingley, Alliance and Leicester and even the mighty HBOS will feel the pain from a forecast of a 15% drop over 2 years. The Government has increased the national debt by 50 billion, the impact of which has been felt in the foreign exchange markets with the pound plunging on fears that that further bailouts will lead to a surge in bond issues resulting in higher IR!

Posted by who stole my pension? @ 03:03 PM 3 Comments

LOL - i almost pissed myself

The Scotsman: Taxman set to target buy-to-let landlords over undeclared profits

PROPERTY owners are facing a new tax investigation by the taxman, a leading accountancy body warned yesterday. Anyone who does not declare income from renting out property risks being investigated by Her Majesty's Custom's and Revenue (HMRC), according to the Association of Chartered Certified Accountants (ACCA). The warning came as the accountants body revealed that HMRC's compliance unit is this week issuing 500 letters to self-assessment taxpayers who it believes may be making money from buy-to-let.

Posted by roger @ 02:38 PM 4 Comments

Imploding fast

Timesonline: A&L, Abbey, Coventry, and Godiva to pull 125% mortgages

Those coming off fixed rates needing 100%+ loans will have nowhere to go. Cleveland Ohio style defaults coming to British estates in the not too distant future. A very significant milestone on the HPC journey.

Posted by neverfunny @ 02:38 PM 2 Comments

Watch this program again on 4oD

Channel4: Dispatches: How The Banks Bet Your Money

Very good documentary on Channel 4 going into detail on the credit crunch, sub prime, cdo etc etc. Installing 4oD is slow and clumsy because it needs microsoft programs. But it does work well.

Posted by happyrenterz @ 01:03 PM 28 Comments

A&L stop their 130% Mortgages from tonight

Mortgage Strategy: A&L pulls PlusMortgage

Alliance & Leicester is withdrawing its PlusMortgage range from close of business today. The product combined a mortgage of up to 95% LTV and an additional unsecured loan of either 5% or 30%, bringing the maximum allowable LTV up to 130%.The product launched in April last year to compete with other high LTV deals such as Northern Rock's Together range and similar deals from Coventry and BM Solutions.Stephen Leonard, director of mortgages at A&L, says: "We are a prudent and responsible lender with PlusMortgage successfully targeting high quality applicants. "However, we keep our product range under constant review and given current market conditions, we will be withdrawing our PlusMortgage products at this time."

Posted by no room at the inn @ 01:02 PM 4 Comments

Don't get your hopes up, it's government led!

Citywire: Government launches anti-mortgage-fraud initiative

Alarm bells should start ringing for lenders and buyers when a property deal has to go through a specific broker or solicitor, warned Tom ONeill, director of buy-to-let specialist Fuel Investment. One broker he knew talked a client into taking out mortgages of 12 times her salary. Then she was advised to take out 100,000 in loans to meet the mortgage payments on two buy-to-let properties. They were later repossessed

Posted by francis @ 01:00 PM 0 Comments

They're all starting to come out of the woodwork now.

BBC: Credit Suisse 'suspends' traders

Credit Suisse has suspended a "small number" of traders suspected of inflating the value of mortgage-backed bond investments.

Posted by becky @ 11:42 AM 16 Comments

Northern Rock Reverse Run

BBC: Robert Preston

This made me smile, if only it could pan out like this! Increase in Mortgage rates on the bcards I hope!!

Posted by lloyd @ 11:20 AM 4 Comments

Inflation won't go away

MoneyWeek: Why inflation is still a problem

Inflation is probably the last thing you're worrying about right now. After all, the coming slump will force retailers to cut prices and consumers to slash spending, won't it? Think again, says John Stepek.

Posted by damien @ 11:06 AM 1 Comments

House prices to plunge

London evening Standard: Stand by for a plunge in house prices as global picture changes

"The prop under the housing market has been removed and prices must fall. Bond highlights how people had only been able to enter this world of unreal pricing because of the exceptional conditions in world markets - the def lationary pressure from China, the glut of world savings and the willingness of central banks to cut interest rates at any sign of an economic slowdown. This has allowed the huge rise in personal debt that has driven the surge in house prices."

Posted by doomwatch @ 09:56 AM 18 Comments

20 most expensive streets in England and Wales

Times Online: The 20 most expensive streets, 2008

Recent housing market statistics may show that property prices are stagnating or even falling in some areas. But according to new research by the property information website, mouseprice.net, the credit crunch has not caused values at the very top end of the market to topple. The 20 most expensive streets in England and Wales have average property values ranging from more than 4.5m to just under 7m.

Posted by mari @ 09:24 AM 2 Comments

View from across the pond

LA Times: Loans go bad as British housing bubble pops

When Shirley Hale's husband dumped her for a younger woman she didn't get mad. She got a new house. By last year, Hale had fallen behind on the payments on her "gorgeous little place" and was looking at foreclosure -- until a mortgage "rescue" company stepped in. Hale signed over her house for $50,000 less than what it was worth, and was told that in return she could continue living there as long as she liked for $600/month. Six months later, the mortgage was transferred to Britain's major sub-prime lenders and Hale was given 28 days to get out. Sub-prime loans account for more than 6% of all the mortgages in Britain. [I thought there was no sub-prime in Britain ;p - LP]

Posted by little professor @ 08:57 AM 8 Comments

Fitzmaurice, who lives with his wife Rita, 77, in Heacham, Norfolk, owes 1,359 on his 2007-2008 Band D council tax plus 209 bailiff's and court costs. The couple receive 200 a week in pensions.

mail: Aged 76 and in handcuffs: The council tax rebel jailed for refusing to pay 1,483.51

Mr Fitzmaurice, who spent 22 years in the Royal Army Ordnance Corps, had declared in court: "I am here on a matter of principle. The way old age pensioners are being treated is shameful."

Posted by chris @ 08:53 AM 29 Comments

Perhaps Sale and Rent back is actually the real price

BBC News: Sale and rent back rip-off claim

Interesting article calling for tighter regulation of sale and rent back schemes. Shock, horror, in some case people entering such schemes only get paid 50% of what a valuer may say the property is worth. But given what we all know perhaps that is actually the fair price! I'd like to know if these StRB figures get included in the land registry? We all saw Panorama and how the land registry figures got fiddled, is this another fiddle to keep the index high?

Posted by mikelivingstone @ 08:36 AM 5 Comments

Are we in a "bailout era"

Wall Street Journal: U.K.'s Northern Rock Move

Worldwide we are seeing bailouts by SWF and governments. "Financial institutions have been pretty good at taking governments hostage," said Charles Wyplosz, an economics professor at the Graduate Institute in Geneva. "The taxpayer is likely to face a huge bill." EU regulation may force NR to be downsized for competitive reasons. "the bank's mortgage book to be reduced by around 50% to 60%, so that the ratio of the mortgage loans it has made against the deposits it has taken in is more in line with its U.K. peers." A lot of bad PR ahead for the gov owners - sacking NR workers, forced evictions for distressed mortgage holders, huge losses when hpc happens...

Posted by happyrenterz @ 08:19 AM 5 Comments

How to Get the Credit You Deserve.

The Times: Business Article

Any takers? What about going to Northern Rock?

Posted by orwell @ 08:18 AM 0 Comments

PREDICTAUSTRALIA HEADING FOR RECESSION next year, because of spiralling inflation.

sky news: Recession warning

Geoff Wilson from WAM told Sky Business Channel that Australians are in for a tough six to nine months, with the current earnings outlook upsetting investor confidence.I think there is a high probability that we will have a recession in '09 and mainly as a result of the increase in interest rates and keeping inflation under control,' he said.Mr Wilson says it won't be until the next reporting season that we will see how companies have weathered the current market turmoil, especially the major banks such as ANZ. 'What we had back in the early 90's...you had provisions for bad, doubtful debts running on average at six per cent, now last year I think

Posted by chris @ 04:30 AM 3 Comments

If some are calling for Darling's resignation over NRK, can we have Gordon's resignation for 10 years of economic mismanagement?

Independent: Hamish McRae: The nationalisation of Northern Rock is no big deal (unlike the state of public finances)

"The economics of Northern Rock look better than the politics. The "n" word may still be toxic politically, but nationalisation is not only the least bad outcome to this sorry tale. It is just possible, with one huge caveat, that the taxpayer might end up making a profit on the deal. The real charge against the Government is not the mishandling of Northern Rock, though it has not covered itself with glory. It is the much bigger issue of its mishandling of public finances more generally."

Posted by blister soul @ 12:36 AM 6 Comments

Monday, February 18, 2008

The numbers get bigger and bigger!

Telegraph: Northern Rock deal could cost us each 3,500

The cost of the Northern Rock crisis has reached the equivalent of 3,500 for every taxpayer as experts warned that the nationalisation rescue of the bank was bound to fail. Fears are also growing that other banks may be in trouble after the Treasury unveiled 'draconian' plans to allow the Government to take any financial institution into public ownership over the next year.

Posted by enuii @ 11:11 PM 8 Comments

Blast from the past: The heady days before the fall

FT: Default insurance cost hits record low

"The cost of insuring European junk-rated companies against default broke through a psychologically important level on Thursday as bullish investors continued to push risk premiums to new record lows in the credit derivatives market. The sustained rally which was under way in the last few months of 2006 and has accelerated in the new year illustrates the extremely positive outlook surrounding the debt markets in spite of concerns over increased borrowings and the potential for leveraged buy-outs." Oh how it has all turned to tears and ashes... Its so incredible how this always happens, we are such a sad bunch, next everyone will be out on strike and the rubbish will be piling up in the streets. Will we never learn?

Posted by last_days_of_disco @ 09:47 PM 0 Comments

BANKING analysts are warning that Australia's biggest banks have become major players in the credit-default swap trade, despite warnings that the deals are opaque and the risks unclear.

AUSTRALIAN: Banks at risk from default swaps

A spokesman for NAB, which is Australia's second-largest lender after the Commonweath, refused to confirm whether the bank had monoline exposure.

Posted by chris @ 07:28 PM 0 Comments

House Prices Hit New High - Further Rises This Year

Daily Express: House Prices Hit New High

A Massive bounce in the housing market has pushed up values by 7,500 in just one month, figures show today. Stuart Law, chief executive of property investment firm Assetz, said: Confidence is returning to the market. This latest rise in prices, combined with Februarys interest rate cut, should fuel further optimism among both buyers and sellers.I expect to see further house price rises this spring, but the Bank of England cant afford to take its foot off the pedal.

Posted by luckyjim @ 06:22 PM 0 Comments

Credit crunch faces the biggest test of all Credit Default Insurance Market

NY Times: Arcane Market Is Next to Face Big Credit Test

Credit default insurance markets ballooned out of obscurity in 2000. Mortgage debt only totals $7 trillion and pales by comparison to this CDS bubble.

Posted by happyrenterz @ 04:30 PM 13 Comments

CPI forecast to be 1.5pc by summer 2009

The Telegraph: Wait a year before you panic about inflation

Roger Bootle see CPI hitting 2.8pc by Autumn 2008 and then falling to 1.5pc by summer 2009

Posted by sold 2 rent 1 @ 03:33 PM 16 Comments

This is only a precursor ... recession approaches.

Times Online: Devil is in the detail of financial announcements

The purpose of nationalisation should not have been - and in the end will not be - what the Chancellor and the Rocks new chairman, Ron Sandler, promised yesterday: to continue business as usual at the bank and eventually to return it to the private sector, maybe even securing a nice profit for taxpayers in the process. The purpose of nationalisation should have been - and in the end will be - to recoup 100 billion of taxpayers money as quickly as possible ..." and to slice and dice it ASAP ... please.

Posted by fahrenheit451 @ 02:14 PM 3 Comments

It's the end of the world!

The Onion: Rotation Of Earth Plunges Entire North American Continent Into Darkness

NEW YORKMillions of eyewitnesses watched in stunned horror Tuesday as light emptied from the sky, plunging the U.S. and neighboring countries into darkness. As the hours progressed, conditions only worsened. Very good spoof story, cleverly put - a massive "crisis" that was as predictable as night following day and experts "suddenly realising" what everyone knew all along, a throwaway reference to a economist, and the media-generated "fear factor" with tales of brave "real people. Sounds like the BBC reporting on HPC..

Posted by dohousescrashinthewoods @ 12:59 PM 0 Comments

Northern Rock Small Shareholder Petition

Downing St Petitions: Carefully consider the fate of the many small shareholders in Northern Rock (and any future companies in peril) rather than writing them off in any plans for the stricken banks future. Small shareholders should be given some protection too!

"In dealing with this crisis, brought on by poor management by both the company directors themselves AND The Government and its agencies, it now only seems keen to: 1. Protect taxpayers; 2. To promote financial stability; and 3. To protect consumers. This clearly leaves out entirely from aims any kind of protection or even consideration for small shareholders. Why? Most small shareholders are not rich people & do not deserve to be written off ENTIRELY, while at the same time all small savers are saved from ANY loss AND the Government also make a profit from its support (or at least hopes to)...."

Posted by happyrenterz @ 12:45 PM 33 Comments

We're in safe hands

The Register: HMRC blows 1.4m on two-word slogan

Her Maj's Revenue and Customs apparently blew nearly 1.4m in 2006 while brainstorming its way to a new slogan which simply reads "HMRC Ambition".

Posted by tezza @ 12:42 PM 3 Comments

Banks can nationalise mortgages

REUTERS: Bank shares rise on NR nationalisation

This snippet makes the point that the lack of competition with the withdrawal of NR from the public sector is beneficial to the other banks. Although, competition backed by the government isn't beneficial. Perhaps the shares have risen because NR will continue to trade as usual, whereas the other banks are certainly not trading as usual, and are making their mortgage deals less and less attractive. The unwanted mortgages finally have a home away from the private sector banks in NR. The proof of the pudding would be an increase in the NR book as they take more risky mortgages on.

Posted by stillthinking @ 12:42 PM 3 Comments

numbers expected to surge in 2008

Firstrung: Record numbers petition for their own bankruptcy

A record number of people in England and Wales asked to go bankrupt during 2007, the latest official Government figures have shown...53,114 people petitioned to bankrupt themselves after being unable to keep up with their debts, as opposed to having their creditors call for them to go bankrupt, according to the latest statistics available from the Ministry of Justice.

Posted by converted lurker @ 12:39 PM 0 Comments

This is approaching Banana Republic status," said Albert Edwards from Socit Gnrale

The Telegraph: Basket case Britain must rebuild its credibility

Britons cling to a comforting notion that overpopulated islands with a shortage of land can never suffer a sharp fall in house prices. Such illusions are often at the root of the most extreme asset bubbles.

Posted by sold 2 rent 1 @ 12:05 PM 9 Comments

Northern Rock shareholders shouldn't get their money back

MoneyWeek: Why Northern Rock shareholders cant expect to get their money back

It's business as usual at Northern Rock: the bank's still bankrupt, and the government is still the only thing keeping it afloat only now its official. It makes a big difference to shareholders, though.

Posted by damien @ 10:58 AM 2 Comments

The reality of selling in 2008......

Daily Mail: Unsold homes swamp property market as owners sell now to avoid big losses

''Soaring numbers of people are putting their homes up for sale, but may struggle to find a buyer, research warns today. On average, each estate agent has 64 properties for sale, the highest number ever recorded at this time of year. This is nearly 20 per cent higher than the same month last year, a sign of the dramatic property downturn over the last few months. But the glut of properties means they are staying for sale much longer than during the boom of the last few years. ''

Posted by hpwatcher @ 09:11 AM 15 Comments

MASSIVE - use of unsuitable descriptors

Daily Express: House Prices hit new high

Nice image of FTB's looking at a wall of unattainable housing. Now apparently even more unattainable

Posted by bystander @ 08:23 AM 19 Comments

Asking prices rose 3.2 per cent to 237,856, but much slower sales

Times online: Clouds hover over the housing market

''The asking price for houses moved up last month but property is taking far longer to sell, according to new figures out today. Homes are lingering on the market for 93 days, 15 days longer than last year, and agents have an average of 64 properties on their books, up from 54 last February, according to Rightmove, the property website. The company's latest survey for the month to February 9 shows that asking prices rose 3.2 per cent to 237,856. The rise, averaging 7,428, pushed the annual rate of growth up to 5.8 per cent, from 3.4 per cent in January. ''

Posted by hpwatcher @ 08:19 AM 2 Comments

The Credit Crunch is spreading to other parts of the market

Economist: Still here

THE credit crunch is simply not going away. Every week another arcane area of the bond market seems to be dragged into the crisis. The underlying problem is as old as finance itselfborrowing short to lend long. As a strategy it can be extremely profitable but it is very vulnerable to crisis. Three things can go wrong: the costs of borrowing can go up, access to borrowing can dry up, or the assets bought with borrowed money can fall in value. All three have happened at various stages over the last six months. When credit booms unravel, another problem tends to emerge. Lax lending standards apply during booms; we have already seen that in the case of subprime mortgages. The same may have applied to corporate lending

Posted by who stole my pension? @ 05:35 AM 3 Comments

There's a Cold Shower Coming

The Times: Basket case Britain must rebuild its credibility

Britons cling to a comforting notion that overpopulated islands with a shortage of land can never suffer a sharp fall in house prices. Such illusions are often at the root of the most extreme asset bubbles.

Posted by quiet guy @ 02:48 AM 2 Comments

Great article simply describing my favourite topic

NYTimes: Arcane Market Is Next to Face Big Credit Test

Credit default swaps form a large but obscure market that will be put to its first big test as a looming economic downturn strains companies finances. Like a homeowners policy that insures against a flood or fire, these instruments are intended to cover losses to banks and bondholders when companies fail to pay their debts. As with other securities that trade privately and by appointment, assigning values to credit default swaps is highly subjective. So some on Wall Street wonder how much of the paper gains generated in these instruments by firms and hedge funds last year will turn out to be illusory when they try to cash them in. The insurance business is very difficult to quantify risk in, said Mr. Farrell of Annaly Capital Management.

Posted by lvmreader @ 02:20 AM 3 Comments

Estate agents start to go bust in New Zealand

stuff oc.nz: Receivership for the Jones

Please shed a tear for the demise of a NZ estate agent chain.Last week we also had a major property investment company called Blue Chip also going bust (it bought and managed properties in Auckland). The sh@t is hitting the fan here and the crash has only just started!

Posted by andy hamilton @ 01:46 AM 0 Comments

Banking Mad?

The Times: Absolutely, incredibly, utterly wrong!

"Why should a Government that has consistently refused to offer public funding for potentially viable commercial projects of real national importance - aerospace, public transport, nuclear power - now be spending tens of billions on supporting a bust mortgage bank?"

Posted by quiet guy @ 01:33 AM 10 Comments

Sunday, February 17, 2008

Oh Noes!

Metro: Rightmove prices up 3.2% in Jan

Thanks to Metro for breaking the embargo, albeit only by an hour. Righmove shows prices rose by 3.2% in Jan. However the figures were distorted by the rush of cheaper 1 and 2 bed properties being placed on the market in December to avoid the HIPs deadline. Without this effect, prices would have risen by 1.5-2%, in line with the traditional February bounce. From June 07 to Feb 08, prices have fallen by 0.6%

Posted by little professor @ 11:12 PM 14 Comments

Always after the fact

FT.com: How Monolines Work

Monolines, companies that insure against the risk of a bond or other security defaulting, have in the past weeks come under fire from ratings agencies, after concerns grew over their ability to meet the obligations to the bond issuers they insure. Some, such as ACA, Ambac and SCA, were recently downgraded, raising fears of a domino effect resulting in further downgrades and market losses for the securities they and other monolines guarantee. In late January New York insurance regulator, Eric Dinallo, urged major banks to provide up to $15bn (7.6bn) to support the monoline industry in an effort to stem the threat of additional losses for banks and other financial institutions with exposure to some of the over $2,400bn of debt guaranteed by bond insurers.

Posted by lvmreader @ 10:34 PM 1 Comments

Why MP's Housing Allowance makes them a powerful VI

The Times: MPs in commuter belt scam

MPs are given 20,000 of taxpayer's money per annum as "Housing Allowance" to spend on a mortgage on a London pad. But they don't have to hand back any of the capital gains they accrue.

So all MPs have a direct vested interest in pumping house prices.

(Even MPs who live in London BTW)

Posted by voiceofreason @ 08:25 PM 9 Comments

NR update - legal action likely

Citywire: Northern Rock: What happens next?

The Government's formal announcement to nationalise Northern Rock may have been long coming but it will trigger a swift response across the City. The first step needed will be for shares in the Bank to be suspended before trading opens on Monday morning. Shareholders may therefore seek to use the Bank's closing share price on Friday, of 90p, as the basis for calculating their compensation.

Posted by jack c @ 07:54 PM 5 Comments

Without the Gov guarantees NR Shares are effectively worthless

Citywire: Government may offer Northern Rock shareholders nothing

The fine print of the Government's promise to have Northern Rock shares 'independently valued' when it nationalises the bank could in fact lead to the conclusion that the shares have little or no value. In a statement to the House of Commons on 21 January chancellor Alistair Darling said that the legislation he was preparing to nationalise the bank would seek to compensate Northern Rock shareholders based on the value of their shares if the Government's support was withdrawn.

Posted by jack c @ 07:50 PM 2 Comments

profit or loss

Private: First time buyer calculator

I created this to see how much could be gained/lost over a period of time on a property depending on your circumstances.. Aimed mostly at FTBers thinking of taking out an interest only mortgage http://www.filefactory.com/file/d2bfb8

Posted by holding off @ 07:18 PM 2 Comments

We're all lenders now

Monevator: Northern Rock nationalised: A nation now in hock to a housing bubble

The authorities responsible for dealing with the Northern Rocks collapse have been making poor precedent-setting decisions since day one of this pantomime. None are so significant as nationalisation, however. And unfortunately, even housing bears have now got a vested interest in the housing market not collapsing.

Posted by the investor @ 05:13 PM 1 Comments

What do we think of the Rock's Nationalisation?

SKY: Breaking News: NR

Sky reports that the government has taken NR into public ownership.

Posted by alan @ 03:12 PM 70 Comments

Buy to Let now available on prison cells

FT Adviser: Prisoner gets "approval" for 9 mortgages

A serving prisoner has been able to obtain multiple buy-to-let mortgages from a well-known crisis-ridden mortgage bank despite using the prison as his official address, it can be revealed. The man, who is believed to be a mortgage broker directly regulated by the FSA, but is also affiliated to one of Britain's best-known IFA firms, applied on nine separate occasions for mortgages from the troubled bank and on each occasion was given a loan. Buy-to-let mortgages are not regulated by the FSA as they are considered to be commercial arrangements. The City of London police will be publishing a report on mortgage fraud at the end of February.

Posted by jack c @ 01:55 PM 4 Comments

Britain's biggest housebuilder, is at risk of breaching its banking covenants.

Guardian: Barratt's borrowing causes concern

Barratt Developments, Britain's biggest housebuilder, is at risk of breaching its banking covenants. With debt approaching 2bn the builder, responsible for one in eight new homes built in the UK, needs to reduce its debt by 100m. As things stand it would break its contractual obligations with the banks.But there is nothing to suggest Barratt's banks would unduly penalise the company if it fails to reduce its debt levels, and the company is confident that it will meet its targets. Barratt borrowed heavily after it bought rival builder Wilson Bowden for 2.2bn last year, before the credit crunch precipitated a fall in house prices.The firm's shares have fallen alarmingly and some City insiders believe the company will have to go cap-in-hand to the City and raise money via a rights issue.

Posted by jack c @ 01:10 PM 3 Comments

Lenders spooked that a US-style debt crisis is playing itself out in the UK

Independent: The debt advice that adds to the problem

Figures from the Council of Mortgage Lenders show that about 130,000 people in the UK are three months or more behind with their mortgage repayments. Spooked that a US-style debt crisis is playing itself out here, lenders are busy urging homeowners to contact them as soon as they find they can no longer cope with the bills. But even if they act responsibly and seek help with their debts, overstretched borrowers could still find themselves in for a shock, through the imposition of fees for a debt or arrears counselling service.

Posted by jack c @ 01:01 PM 4 Comments

More than eight million Britons are in serious debt a quarter of whom are struggling to make their repayments

Independent: Merchants of Misery: Debt collection is one of the UK's fastest-growing industries

Debt collection agencies and bailiffs are raking in unprecedented sums from Britain's growing mountain of personal finance misery, an Independent on Sunday investigation has found. Last year the agencies and bailiffs pursued no fewer than 20 million cases and the methods they used to squeeze money from people are so aggressive that experts ranging from the Citizens' Advice Bureau (CAB) to members of the House of Lords are now calling for legislation to curb these excesses. A growing army of thousands of "debt chasers" is making millions from the misery of Britons who have spent years spending above their means, in what campaigners have slammed as "legalised profiteering".

Posted by jack c @ 12:51 PM 0 Comments

A nasty little outfit

Observer: What happens behind the locked doors of property seminars

This is how these shabby businesses operate. We've already heard about Inside Track before on HPC. This outfit will disappear soon enough, although likely to rise again in another money-making guise. Also see the link to the story about Chloe, 'mugged' by a similar bunch, Choices Acquisitions. Boom-time parasites.

Posted by letthemfall @ 12:43 PM 1 Comments

Sellers still want funny money

Observer: Sell-to-rent boom as buyers back off

People selling and renting, instead of buying again for silly money. Who thinks this is a bad idea? Why, estate agents of course. One says it's a high risk strategy. More high risk than borrowing up to the hilt and sinking that and every bit of your savings into a single asset? Sounds like a no-brainer to me. Which, incidentally, rather aptly describes estate agents.

Posted by letthemfall @ 12:20 PM 0 Comments

Used dishwasher to cover for negative equity? Uhm... where's my calculator...

aboutproperty.co.uk: Sellers grab kitchen sink

"...curtains, dishwashers and even garden sheds are being transferred to new property as compensation..." Some will realize they've got pretty expensive garden sheds very soon...

Posted by alex @ 11:38 AM 0 Comments

It's their mess - let them sort it

Times: Dont cave in to bankers who plead for more

PLEASE, SIR, can I have some more, whinge the Oliver Twists on Wall Street. More interest-rate cuts from the Federal Reserve Board, a bigger portion of stimulus from the president and Congress, more direct relief for the housing market, a bail-out of bond insurers you name it, and investors and bankers want more of it. Except for write-downs: the increased recognition of losses that nervous auditors are demanding is the one thing the bankers dont want any more of piled onto their plates.

Posted by uncle chris @ 11:05 AM 1 Comments

Farewell and adieu to you, NonDoms

Observer: Property doom: Fears of an exodus

Apparently the "gifted wealth-creators are already reaching for their passports". Or are they gifted pocket-liners? Always bemused me that one. I suspect most work in the financial sector, which seems pretty good at relieving people of their wealth, more so than creating it. If it all helps house prices drop then I think that in itself will return a bit of wealth to us Doms. I for one won't mourn their flight - they haven't put any wealth my way so far as I can see - but no doubt some wealth creator could tell me why they are valuable.

Posted by letthemfall @ 11:01 AM 0 Comments

I know it's off subject - but what's gone wrong with our society?

Telegraph: 1,000 emergency workers a week assaulted

Doctors, nurses, ambulance crews, health visitors and firefighters across Britain are being subjected to frightening assaults as they go about helping the public. The latest figures show there were at least 57,205 attacks on health and emergency workers last year, although the true figure is thought to be much higher as many cases go unreported. Communities are breaking down, society fragmenting, we are seriously thinking of going to Oz or NZ - if they'll have us.

Posted by uncle chris @ 10:48 AM 15 Comments

New Zealand shows signs of housing weakness

Scoop: Significant Increase in No. of Homes for Sale in NZ

35% MORE RESIDENTIAL PROPERTY LISTINGS THAN THIS TIME LAST YEAR Statistics released by the real estate industrys official website show record numbers of houses for sale across the country indicating there may be more homes on the market now than ever before in NZs history.

Posted by happyrenterz @ 08:39 AM 1 Comments

Saturday, February 16, 2008

After the mortgage fraud, the home insurance fraud

Fortune Magazine: Will subprime foreclosures spark an arson boom?

"As homeowners get more desperate, the insurance industry is bracing for an increase in arson. 31-year-old Christina Snyder of Russellville, Indiana, allegedly offered to pay a neighbor $5,000 to help her burn down her house and make it look like a botched rape attempt - all in order to claim $80,000 in insurance money. The neighbor demurred, instead reporting Snyder to police. With the national foreclosure rate zooming and the real estate market in a two-year funk, the insurance industry fears more homeowners will see arson as a way out of their financial woes. Fraud fighters are watching closely for a spike in arsons by desperate homeowners who can no longer afford their home payments. It may already be happening: In California, the number of questionable residential fires is up 76%."

Posted by drewster @ 10:11 PM 2 Comments

Will be the same again for many celebs this time round

Telegraph: Fame and fortune: Dexter Fletcher

I was doing a lot of work by then and I guess I was under the impression I had more money than I did. But I was very wasteful I bought a brand new Land Rover for 13,000 having gone to the showroom looking for a second hand car. When the salesman didn't take me seriously I decided to show off and prove I could buy something new and expensive, just to see the look on his face. Then along came the 1990s property crash. All the equity I thought I had in the house disappeared. My credit cards had racked up and I owed money to friends. Having defaulted on my mortgage I was a month away from being repossessed, so I put up a 'For Sale' sign and a couple knocked on the door who had just been gazumped on a house nearby.

Posted by lvmreader @ 08:44 PM 1 Comments

The world's biggest subprime borrower

CalculatedRisk: CRE: More on Macklowe

This is a story we've been following because it appears Macklowe bought at the top, and he has a large bill coming due next month for a highly leveraged transaction: [Macklowe] has a $6.4 billion debt payment coming due next month in connection with his purchase of seven ... Midtown Manhattan office buildings a year ago. When he bought those buildings from Equity Office Properties, he ... used only $50 million of his own money to do so; he borrowed $7 billion to finance the rest of the purchase. According to the WSJ, Macklowe paid $6.8 billion for these seven properties, and borrowed a total of $7.6 billion! The NY Times also mentions a couple of other deals in possible trouble:

Posted by lvmreader @ 08:16 PM 1 Comments

Does any of this sound familiar? DotCom Days anyone?

Reuters: Macklowe reaches extension agreements with lenders

Macklowe's strategy was to buy the Equity Office buildings whose long-term leases were about to expire and boost rents to market levels. According to several sources with knowledge of the properties, Macklowe already has increased the value of the largest of the properties, Worldwide Plaza on Eighth Avenue between 49th and 50th, which now commands rents of more than $100 per square foot.

Posted by lvmreader @ 08:12 PM 1 Comments

Fair do's. Well done Assetz.

Assetz: Winner of 2007 house price prediction

Based on official DCLG, Assetz were the most accurate of all major forecasters, predicting growth of 8-10% in 2007 against the eventual 9.1% rise. Cue lots of self-congratulations by Ztuart Lawz. "All I can say is consider buying now whilst the opportunities exist and sentiment is negative enough (whether you are an investor or a first-time buyer) as you won't see these price opportunities around later in the year" Assetz predicts growth of 5% in 2008.

Posted by little professor @ 08:06 PM 14 Comments

Shed and lights extra!

Homemove: Homeowners stripping houses of fixtures and fittings

A study by online conveyancers, Convex.net, has established that homeowners are increasingly stripping their houses of fixtures and fittings when they sell up, as fears of a moderation in prices grow.

Posted by su @ 07:45 PM 2 Comments

Bolting Closed the Stable Doors

The Scotsman: Security is simply a way to cut out risk of mortgage fraud

"the FSA looks like it will come down hard on consumers who commit any kind of mortgage fraud." Erghh... a bit late surely? I'd like to see all those fake self certification mortgages punished but that won't help the economy now.

Posted by quiet guy @ 04:05 PM 2 Comments

Rent are less than advertised...

Guardian: Welcome to negative equity street

More about Manchester's sorry buy to let flat scene. And the advice, if you are renting: While the estate agents in the city had clearly given up for now on property sales, many were still keen to talk up the rental market as "strong". But even that proved to be something of a fallacy, if you are the landlord, that is. While the demand for flats to rent remains buoyant, a chat with some of the army of young office workers that rent many of the city centre flats soon revealed that the prices quoted were just a guide. "If a flat's rental is advertised for 700 a month, you offer 600, you'll almost certainly get it for that. It's a buyers' market, no mistake," I was advised.

Posted by sacred contracts @ 01:48 PM 8 Comments

Chain free

East London & West Essex Guardian: Homes & Property Section

A local estate agent advertised twenty properties for sale in this week's property section, all under the heading "Chain free properties" I rang to check and the lass was very friendly (probably not much else to do) and confirmed that yes, all twenty of them were chain free. I tried to wheedle out of her what the mix of sell-to-renters, panicking BTLers and repossessions was but either she didn't know or wouldn't tell me. Is this normal? Aren't chain-free properties usually only a small minority?

Posted by mark wadsworth @ 12:38 PM 5 Comments

A little light entertainment - Bradford & Bingley caption contest

order-order: B&B caption contest

B&B has been the first bank to report in 2008 and unveiled writedowns of 225.6m, which halved its 2007 profits.The companys shares fell 23 per cent on the news from 243p to 187p and after a further slide yesterday are now at 177p, their lowest ever price since it floated eight years ago at 248p.

Posted by jack c @ 12:09 PM 3 Comments

More "sound fundamental" wheels coming off

times: Tide turns as Poles end great migration

The Times has established that, for the first time since they began arriving en masse four years ago, more UK-based Poles are returning to their homeland than are entering Britain.

Posted by leavingthecountry @ 08:18 AM 23 Comments

Poor little BTL investor

Guardian: Safe as houses? I lost 350,000

Self-employed vet Tamsin Barks knew her life needed new direction. A mailshot from Inside Track said she "could give up work and be a property millionaire." She now has a 1.1m portfolio of 7 BTL properties, but has made a loss after costs of 350,000. "My monthly rental income falls 1500 short of the cost of borrowing the money, and that's before essential expenses. I am running out of money - I'm worried I could lose my home and have to live in a small flat or even a caravan." "I was told I could make money within two years by a process called 'flipping'. I would buy off the architect's drawing [off-plan] by paying a deposit, then sell the property at a substantial profit to another investor just before the keys were due to be handed over. I was told the sky was the limit"

Posted by little professor @ 01:58 AM 38 Comments

Spectre of negative equity back with a vengeance

Guardian: Pop goes the property boom

Prices for new-build flats are in freefall, with some buyers who paid top-of-the-market prices as recently as 2005 now seeing the values of their homes down 40%. We focused on Manchester and found flats selling for 50,000 less than the owner paid for them. Repossessed flats are being dumped on the market for prices that would have seemed unimaginable a few years ago. Meanwhile buyers are reluctant to enter the market in case they end up over-paying. Estate agents windows marked up with "price corrections", and one saying: "Make me an offer - I may say yes."

Posted by little professor @ 01:52 AM 14 Comments

Friday, February 15, 2008

Whoopsie: 8th February 2007

The Street: Flashback: MBIA Shrugs Off Subprime

Mortgage insurance firm MBIA says it has very little exposure to the subprime slime that has shaken up Wall Street. The Armonk, N.Y.-based bond insurer held a two-hour conference call to explain how loans provided to borrowers with unsavory credit quality are affecting it. MBIA outlined its portfolio composition and underwriting criteria in a bid to quell investor fears that have sent its shares on a tailspin this week. CFO Edward Chaplin said that although the financial firm insures some deals tied to subprime in pools of structured securities, including so-called collateralized loan obligations and residential mortgage-backed securities, its overall portfolio has fared well.

Posted by lvmreader @ 11:35 PM 3 Comments

It ain't just subprime

Breitbart: US subprime crisis costs global 7.7 trillion dollars: bank

The meltdown in the US subprime real-estate market has led to a global loss of 7.7 trillion dollars in stock-market value since October, a report by Bank of America showed Thursday. The crisis, which has spread beyond US shores to banks and other sectors worldwide, is "one of the most vicious in financial history," according to Bank of America chief market strategist Joseph Quinlan. Quinlan said in the report that the losses are worse than any in the past few decades, including Wall Street's Black Monday of 1987, the 1999 Brazilian real currency crisis and the collapse of hedge fund Long Term Capital Management (LTCM) in 1998.

Posted by lvmreader @ 11:12 PM 0 Comments

Same figures, different story

Glasgow Evening Times: House prices fall by 60 a day

Yes, I know the Lloyds TSB Scotland figures have been posted a bazillion times already today, but thought it was worth posting this story just for the headline and the naively smug comment from reader "Mekon"

Posted by little professor @ 08:46 PM 2 Comments

Bernake Says US Economy Worse Than He First Thought.

The Times: Business News

And which economist was it who said that the Credit Crunch was only at the stage of the National Anthems having just been played?

Posted by orwell @ 06:32 PM 1 Comments

Citigroup shuts London fund to withdrawals

The Times: Business Article

And this of course is not a Commercial Property Fund? Are no Hedge Funds sacred?

Posted by orwell @ 06:28 PM 0 Comments

Contagion effect on Auction-rate securities

NY Times: A Crisis of Faith

Good article on Auction-rate securities failure that happened earlier this week. "The Port Authority, which had a failed auction last week, just saw the interest rate it pays leap from 4.3 percent to 20 percent." "I like to think of whats happening as a sort of minor-key reprise of the banking crisis that swept America in 1930 and 1931. Frustrated investors who cant get their money out of auction-rate securities arent as photogenic as angry mobs milling outside closed banks, but the principle is the same."

Posted by happyrenterz @ 05:29 PM 0 Comments

We're all doomed Mr Mainwairing...

Guardian: Treasury debt is twice Chancellor's 'sustainable' figure, says think-tank

By knowing what Gordon Brown has signed us all up for - we can each make plans and try to look after our families as best we can. Alternatively, some of us can bury our heads in the sand and hope it all goes away... "Gordon Brown has hidden liabilities worth more than 500bn, and the true size of the public debt is up to 87 per cent of GDP, more than twice the Treasury's 'sustainable' limit, according to the Institute for Fiscal Studies. Using the government's calculations for the cost of public sector pensions, private finance initiative schemes, and Network Rail's debt, which the Treasury guarantees, the think-tank has reached a total figure of more than 1,100bn - twice what the Treasury admits to."

Posted by cornishman @ 04:40 PM 16 Comments

A taste of things to come; the bailiff

USA Today: Repo lots overflow with reclaimed cars

Good job Tony had all those new bailiff laws passed just before he left. Wonder why eh ? "The rise of bad loans, however, has meant busy times for "repo men," whose work can involve seizing cars from driveways in the dead of the night."

Posted by doomwatch @ 04:39 PM 2 Comments

Spot the ridiculosity in this story.

Press Association: House prices boost rental returns

Buy-to-let investors made average returns of more than 16% during 2007 on the back of rising property prices and increasing rents, figures show. The average landlord made returns of 16.3% on their property during the year, excluding the cost of mortgage interest and fees, up from returns of 13.5% in 2006, according to Birmingham Midshires. The rise was partly driven by a 10.7% jump in house prices last year, but the group said most of the gains were seen during the first half of 2007. Rents also rose by 13% over the year.

Posted by little professor @ 03:06 PM 10 Comments

Statistics and how they are calculated

The Times: An essential guide to what the housing market surveys really mean

A VERY useful article to show that no matter who measures the stats, there is not a uniform way of doing it. Notably, the Nationwide do NOT include BTL in their numbers.

Posted by growler @ 02:24 PM 4 Comments

Imagine a world without banks

thepriceofeverything blog: The modern banker as Typhoid Mary. Discuss.

"Typhoid Mary managed to infect 47 people during the course of her career as a cook. Her fame is in part due to her vehement denial of her own role in causing the disease, together with her refusal to cease working. Nobody, of course, suggests that modern banks are virulent and destructive plague carriers. They are a lot more dangerous than that."

Posted by happyrenterz @ 01:32 PM 5 Comments

Monoline breakup plan was not Buffett's idea

FT Alphaville: When Dinallo met Buffett: the monoline breakup plan

NY Insurance superintendent Eric Dinallo elucidates: "We have been actively discussing all of the options with the bond insurers..It was to ensure a safety net for the municipal bonds that over the Martin Luther King Day weekend in January we asked Berkshire Hathaway to price the entire municipal bond portfolio of the three largest bond insurers. Earlier this month, Berkshire sent its proposal to the three companies. I believe that there may be other investors who would be interested in investing in the municipal side of the business."

Posted by happyrenterz @ 01:03 PM 3 Comments

House flipping over in Scotland, not so sure about caber 'tossers'...

Firstrung: Scottish house prices fall by 1.3% in last three months

The boom in Scottish house prices has come to an end according to the latest Scottish House Price Monitor from Lloyds TSB Scotland, with the first quarterly fall in the all Scotland average house price for seven years. In the three months to 31 January 2008, the quarterly price index for the average domestic property in Scotland fell by 1.6 per cent to give an average mix adjusted Scottish house price of 163,211. On an annual basis, Scottish house prices have risen by 14 per cent.

Posted by converted lurker @ 12:53 PM 7 Comments

CAB warns that the growth of sale-and-rent-back schemes may have had an impact on repossessions

Mortgagestrategy: CAB renews call for tighter regulation

The Citizens Advice Bureau has renewed its call for tighter regulation of the mortgage market following the Council of Mortgage Lenders repossession figures.The CAB warns that the at 27,100, total repossessions in 2007 were up 21% on the previous year and were nearly twice as high as the figure seen two years ago in 2005. We want to see all lenders being reasonable when dealing with customers who do get into trouble, and taking court action for possession only as a last resort.

Posted by jack c @ 12:29 PM 4 Comments

Maintenant, les Franais viennent!

FT.com: Natixis plunges on 1bn writedowns

Goodbye ClubMed! The Euro is a SHAM

Having got to know the French mentality over 12 years or so, stand by for more of the same..... Et, comprenez-moi bien, j'adore absolument mes potes francais. J'habitais la-bas en fait.

Posted by lvmreader @ 12:24 PM 13 Comments

Billionaire Mahers Rack Up Losses In 'Auction' Bonds

Wall Street Journal: Debt Crisis Hits a Dynasty

When M. Brian and Basil Maher sold their family's shipping business last July for more than $1 billion, they quickly put the money in a safe place. Or so they thought. The two brothers handed much of it to Lehman Brothers Holdings Inc. with marching orders to make only the most conservative, cashlike investments. Within weeks, however, they had lost access to more than a quarter-billion dollars. "We didn't think we were taking risks," says Brian Maher, 61 years old. "We read about all the troubles in the credit markets and said, 'I'm glad we're not invested in that stuff.' It turns out, we were."

Posted by lvmreader @ 11:39 AM 3 Comments

Should you be buying into farmland?

MoneyWeek: The most recession-proof asset class

Higher food prices are encouraging farms to expand, pushing the price of UK farmland to new highs. And that has fuelled pure investment demand - but is the land itself the best way to take advantage?

Posted by mary @ 11:18 AM 7 Comments

Americans simply walk away from debt

Wall Street Journal: The Rise of the Mortgage 'Walkers'

Borrowers in the USA are walking away from mortgage debt, leaving the the mortgage-securities investors stuck with the property. This is the letter of the law in some states and simply common practice in others. Even prime borrowers are tempted to walk away if they are in negative equity as there is no financial penalty for doing so, only a hit to their credit rating. Essentially, mortgage-bond investors unwittingly sold homebuyers a put option without properly pricing it, and now homeowners are exercising that option. Nobody is going to debtors' prison. It's beginning to dawn on lenders and their agents that they could be stuck owning hundreds of thousands of depreciating properties. ----- NOTE that this is not the case in the UK, where borrowers can't just walk away.

Posted by drewster @ 11:03 AM 4 Comments

We are so stuffed

The Telegraph: Recession would threaten borrowing rules

The report said a major downturn in the coming months, with the economy shrinking by 1pc, "could see public borrowing rise as high as 100bn or even 150bn per annum, blowing the fiscal framework to smithereens and perhaps even leading to some rise in the Government's relative cost of borrowing".

Posted by sold 2 rent 1 @ 10:27 AM 13 Comments

How far will this escalate?

The Telegraph: Vladimir Putin's nuclear threat to the West

Although he did not elaborate, Mr Putin gave warning of retaliation once Kosovo broke away - a threat likely to chill Western leaders. "We have a ready-made plan and we know what we are going to do," he said.

Any ideas on this?

Posted by sold 2 rent 1 @ 10:18 AM 16 Comments

Looks like Scotland isn't that different after all

BBC News: Property Boom "Over in Scotland"

This was one of their 'most read' stories this morning - the reality will slowly hitting home to people if govt-controlled outlets like the BBC are carrying these stories. Remember though, Scotland is exceptional. There's never been a house price crash in Scotland so there won't ever be one. Prices are only falling in England, Wales, Northern Ireland, Ireland, the US and Spain - but they won't fall in Scotland because it's a unique market.

Posted by an bearin bui @ 09:57 AM 2 Comments

NAEA kite flying

Firstrung: First time buyers returning marks a significant change in fortunes of housing market - NAEA

Are first time buyers returning in droves as the NAEA would have us believe? Is the UK housing market gaining momentum? The problem with claims such as the NAEA make is that they must be backed up with fact...Given the falling mortgage approval numbers over the past four months how can this support their claim of a re-vitalised housing market? Moreover, if as they claim prices are holding up why would first time buyers suddenly rush in given they found the housing market at its most unaffordable in the last six months of 2007? If up to 75% of 'riskier' mortgage product has been stripped from the mortgage market where would the 'mortgage tools' to climb onto the first-rung come from?

Posted by converted lurker @ 09:54 AM 19 Comments

House builders - please buy our houses!! We'll cover your losses when the price falls!

Redrow Homes: House Price Protection

Only up to 10% mind! I heard an advert for this on the radio yesterday... "It's all about giving confidence in uncertain times: it is not about Redrow believing matters will get worse. We are confident in the long term value of our homes, and the benefits associated with buying a brand new Redrow home. Our promise to you is simple: If you buy a new Redrow home and sell it within 3 years, and can't get what you paid for it, Redrow will refund the difference up to 10% of the price paid."

Posted by a bear in the woods @ 09:31 AM 1 Comments

North of England housing market downturn (non VI info)

nebusiness: Jobs go as housebuilders feel downtown in market

At least two major housebuilders are looking for redundancies in the North East as the slowdown in the housing market starts to bite. Newcastle-based Bellway has sent out redundancy consultation notices to its hundreds of site staff and is considering 66 job cuts, while Taylor Wimpey is understood to be looking for 35 redundancies. Other major players, including industry number two Persimmon, are also reported to be aiming to cut back on front line jobs. Andrew Miller, head of Barclays Wealth stockbrokers in Newcastle said "There has definitely been a weakness of late, particularly in new-build property. For instance, with so many flats being built, I know there have been problems in Leeds and Manchester on that"

Posted by jack c @ 09:22 AM 4 Comments

Hoping for the best.......

times online: Bonus rich bankers to reignite UK housing market

''Spring house buying will be revitalised by bankers who expect City bonuses to match or outweigh last year's. Signs of life are re-emerging in the property market as it prepares to enter the spring buying season, as agents herald the return of bargain-hunting first-time buyers and City professionals with bonus cash to spend.''

Posted by hpwatcher @ 08:18 AM 27 Comments

Mortgage Risk Repricing Continues

The Times: Halifax 'rations' mortgages

'The move is seen as part of a wider trend of "leap-frogging" among lenders, who are competing to avoid business rather than to bring in new customers. Ray Boulger, of John Charcol, another broker, said: "Lenders like Halifax are effectively rationing loans. They are generating the amount of business they want and then rejecting it when they can no longer cope with demand. Lenders are leap-frogging each other to the bottom of the best-buy tables. They are no longer competing for business, they are competing to avoid it."'

Posted by quiet guy @ 06:40 AM 3 Comments

Linked from msn home page with the caption "The time is right for buying to let."

MSN Money: Getting started in buy-to-let

I hope they are trying to be funny. "The high cost of mortgages has in many cases required some contribution from the landlord towards covering the mortgage. However, if you are in it for the long term and have picked out a prime location with good rental demand, you will benefit in the long run." I suppose it depends how you define benefit.

Posted by morbotheterrible @ 02:55 AM 2 Comments

This guy doesn't think so

Marginal Revolution: Was there a housing bubble?

Alex Tabarrok has created a lot of buzz with this post, arguing that because house prices have risen so much, it's not conceivable that they will drop back down to the long-term average. He argues that we are in for a reset to a new higher equilibrium for house prices, such as that which occurred after WWII. There's been a huge reaction to the piece in the blogosphere (ugh, hate that term) with heavyweights such as Paul Krugman criticizing it, although noone has yet put forth a convincing counter-argument. Well worth a read.

Posted by little professor @ 12:27 AM 14 Comments

Soft landing for Scottish house prices

The Herald: House price fall signals end of boom

Average house prices in Scotland have experienced a quarterly fall for the first time in seven years, signalling a possible end to the recent boom. Between November 2007 and the end of January the cost of an average property fell by 1.6% to 163,211, figures published by Lloyds TSB Scotland yesterday showed. Experts at the bank have said this points to the end of the country's property price boom, as the housing market "pauses for breath" and prices begin to level out.

Posted by little professor @ 12:05 AM 7 Comments

Thursday, February 14, 2008

Retail figures down over Xmas yet credit card debt now rising to cover household expenditure

Times: Credit card spend sounds credit crunch alarm

Consumers spent a record sum on credit and debit cards in the final three months of last year as borrowers increasingly used plastic to pay their household expenses. Credit and debit card spending rose to 91.5 billion, up from 86.6 billion in the three months to last September. The Association of Payment Clearing Services (Apacs), the body that represents lenders and credit card companies, says that 32.4 billion was spent on credit cards between October and December last year, the second-highest sum in history. "Retail figures were down over Christmas, yet credit card debt is still rising. "This indicates that we are seeing people shifting spending on to credit cards as household expenses mount up.

Posted by jack c @ 09:37 PM 3 Comments

Commercial property down 12% year-on-year

CB Richard Ellis: Monthly Survey

Not much more to add - the survey is short and includes the staggering statistic that the annualised fall over the last three months is 36% (thirty six percent). Rather bizarrely, London freesheet 'City AM' span this as "Commercial property now through the worst" (not available onlin), as the monthly fall in January of 2.1% was only half the fall in December.

Posted by mark wadsworth @ 09:15 PM 0 Comments

Even the BOE is forecasting a fall.

This Is Money: House prices may fall, warns Mervyn King

Homeowners have been warned their properties could fall in value in real terms over the next four years by the Bank of England governor Mervyn King.

Posted by garyb @ 08:12 PM 0 Comments

What housing shortage?

London Evening Standard: Mavis, 83, has luxury block of 30 flats to herself

Divorced Mavis spent 300,000 on a two-bed apartment in the block of flats in Newquay, Cornwall, six months ago. But within days she realised the remaining 29 of its 30 flats are used by second home owners - mostly well-heeled professionals from London. Because they are only used as holiday flats a few weekends a year, mum-of-three Mavis has free run of the block and all its facilities. In Cornwall, it is thought up to 10 per cent of residential properties are second homes.

Posted by papabear @ 05:54 PM 0 Comments

No sh*t Sherlock...

BBC News: Fed boss warns of weaker economy

I believe Paulson & Bernanke really do know just how bad things are going to get, but have to drip-feed the bad news to avoid a general panic... "I believe our economy will continue to grow, although its pace in coming quarters will be slower than what we have seen in recent years" Of course you do...

Posted by doom&gloom @ 05:45 PM 4 Comments

NAEA report in stark contrast to RICS

Mortgagesolutions: Market gaining momentum

The property market is gaining momentum, according a preview of figures from the National Association of Estate Agents (NAEA) monthly housing market survey. Buyers on books, housing stock and sales all increased in January. The overall number of house buyers went up 11% in January.First time buyers accounted for 14.5% of all sales, a rise of over 3% for the same period last year. Peter Bolton King, chief executive at the NAEA, said: I am confident that we have just started to see the benefit of first interest rate cut in December and the latest quarter percent decrease in February will further help boost the confidence of all buyers and particularly first time buyers.

Posted by jack c @ 05:24 PM 21 Comments

Credit card spend sounds credit crunch alarm

The Times: Business Article

Says it all really. I can definetely tell David Smith that inflation is more like 6% and that people are buying essentails and not luxuries on their cards.

Posted by orwell @ 05:00 PM 0 Comments

Realtors say prices fell faster and in more places over last part of 2007

CNN Money: Home prices in steepest quarterly drop

NEW YORK (CNNMoney.com) -- Home prices continued their plunge during the last three months of 2007, setting a real estate trade group's record for the biggest-ever quarterly drop. . The national median price drop of 5.8%, to $206,200 from $219,300, was the steepest ever recorded by the National Association of Realtors (NAR), which has been compiling the report since 1979. NAR officials blamed the liquidity squeeze that began last summer for much of the drop. Home buyers had trouble obtaining mortgage financing, especially for more expensive properties. Fewer expensive homes were sold, bringing down median prices. "California, south Florida, D.C., many of the high-cost markets are reflecting that," said Walter Molony, a spokesman for NAR.

Posted by my 2 cents @ 04:55 PM 1 Comments

Is the glass half empty or half full?

Ray Boulger's blog (Charcol): Repossessions in 2007 not as bad as expected

There is likely to be a sharp increase in the number of repossessions of heavy adverse sub prime borrowers who are unable to remortgage as a result of lenders tightening their criteria. Some deals which could have been done with several lenders 6 months ago are now just not doable. On the other hand most people other than recent First Time Buyers now have a reasonable amount of equity in their property and also it is hard to estimate the impact of the new breed of sale and leaseback operators which have sprung up in the last couple of years.

Posted by tamsin bishton @ 04:39 PM 0 Comments

Mavis wants some ol chap to brew tea with....

daily mail: home alone

what does this mean, same old story in every tasty seaside village, empty for most of the year and all the young uns living in the nearest big city. !

Posted by camping @ 04:36 PM 0 Comments

In the last year 13 major developments have been given the go ahead despite Environment Agency advice on the flood risk

Association of British Insurers: Unsaleable, Uninsurable, Uninhabitable Tougher Planning Controls Needed for New Homes says the ABI

Tougher planning controls are needed if flood insurance is to remain widely available for new homes the ABI (Association of British Insurers) said today (14 February). Of the three million new homes the Government plan to be built by 2010, a third will be on the floodplain.

Posted by jack c @ 03:01 PM 1 Comments

Get both gold and gold stocks

Safe Haven: Bullion or Mining Stocks - Do You Have the Right Mix?

Many investors believe their portfolios have exposure to precious metals because they hold stocks in mining companies. But as a safe haven, no gold or silver or platinum stock (or even an ETF) compares with physical bullion.

Posted by sold 2 rent 1 @ 02:35 PM 10 Comments

This guy is predicting 70pc falls

Safe Haven: Asset Deflation 13: Sell Your Real Estate Immediately!

Given my grave doubts that a combined Fannie Mae, Freddie Mac crisis plus credit-derivatives-nightmare can be averted as asset deflation intensifies, I now expect a frightening systemic event in the U.S. at some point, possibly within the next few years, which will take property values out at the knees and cause transactions to come to an utter standstill for a time. At that point I expect loans to become almost impossible to get and buying psychology to be so damaged, a generation of people will tell you "you should never buy real estate." Regardless, the economy will be shaken by these unfolding events to the extent that the mere thought of buying real estate (absent a massive cash discount) will be considered by most a preposterous notion.

Posted by sold 2 rent 1 @ 02:11 PM 14 Comments

Gordon & Co getting battered from all angles

BBC: Government like 'demonic beast'

The Bishop of Carlisle has compared Gordon Brown's government with a "demonic beast" from the Bible. The Rt Rev Graham Dow accused the government of behaving like a seven-headed beast in "imposing its morality" on the nation.

Posted by jack c @ 02:08 PM 11 Comments

Our survey said ........uh uh! [Family Fortunes?]

RICS: Podcast for January Survey

click on the "Listen to the ...podcast". It will be interesting to listen to this going forward.

Posted by techieman @ 01:33 PM 3 Comments

Pity the German taxpayer over IKB

FT Alphaville: Let it fail, Mitteleuropa edition

Thus whereas Northern Rock was a casualty of an interbank liquidity crisis, IKB was both casualty and cause." (simply bad investments in US subprime excreta). Why the bailout? "a collapse of IKB would trigger a guarantee mechanism designed to spread the burden of a bank failure across the sector. A trigger of which would cost German banks 24bn,"

Posted by happyrenterz @ 01:25 PM 1 Comments

UK worse than US

FT Alphaville: Will the UK housing market follow the US?

Weve been told that the UK housing market is in worse potential shape than its messy US counterpart. And here is the graph to prove it, courtesy of Merrill Lynch. UK house prices - both in terms of absolute values and relative to income - have risen further in the UK than in the US over the past decade.

Posted by happyrenterz @ 01:12 PM 14 Comments

A decent desription of the current madness in the UK housing market....

Investment and Business News: The great exodus: owner-occupiers become renters in biggest change ever seen

"And finally, and surely the answer to this riddle will determine the ultimate course of house prices, if house prices are too expensive for would-be owner occupiers, how can it be viable for investors to buy those properties and rent them to the very same people who cant afford to buy them?"

Posted by notlongnow @ 12:55 PM 1 Comments

So no rogue traders at UBS then.

Telegraph: UBS posts $13.7bn sub-prime write-down

UBS has reported the biggest ever fourth quarter loss by a bank after it made a $13.7bn (7bn) write-down on positions related to the US sub-prime mortgage market. The write-down at the Swiss bank caused a net loss of SFr12.5bn (5.7bn) in the quarter, compared with a SFr3.4bn net profit in the same period last year. UBS chief executive Marcel Rohner described last years as "one of the most difficult in our history" and warned that 2008 would be "another difficult year." The bank has already announced that 1,500 jobs will go as a result of the problems, and has warned that more could follow.

Posted by stevie dee @ 12:43 PM 0 Comments

Bankers Seek to nationalise risk after private profits slump

WSJ: Worried Bankers Seek to Shift Risk to Uncle Sam

Nice business move, take the profits when times are good and ask the tax payers to carry the can when it goes bad, the win win business model.

Posted by yoss @ 11:34 AM 0 Comments

Get poor quick - invest in buy-to-let

MoneyWeek: How to get poor quick invest in buy-to-let today

Britain's second-largest buy-to-let lender, Bradford & Bingley, is to raise interest rates and deposits in response to tougher conditions. So it looks like buy-to-let is now a rich man's game. But would even a rich man want to buy into this market?

Posted by mary @ 10:52 AM 4 Comments

Barclays Capital - inflation, higher interest rates, lower house and share prices and economic volatility

Telegraph: Bleak outlook for economy echoes 1970s

Barclays Capital strategist Tim Bond predicted a period of painful retrenchment from today's "unsustainable" levels of household debt, and said the bursting of credit and housing bubbles was inevitable.

Posted by jack c @ 10:21 AM 13 Comments

Note to webmaster: Content stealing by another website

House Price drop: House Price drop steals HPC content

I had the same problem in 2002 with a gambling website I ran. Not really a big issue but the screen scraping may cause the website speed to perform badly

Posted by sold 2 rent 1 @ 10:12 AM 14 Comments

A must watch for you smart people

Channel 4: How the banks bet your money

I hate banks, Thomas Jefferson said they would take are freedom an wealth!!

Posted by lee @ 10:02 AM 1 Comments

Repos will hit the bottom end and top end of the market

CNN: Rust and Sun Belt cities lead '07 foreclosures

"Most of the metro areas with the highest foreclosure rates were either cities like Stockton and Las Vegas, which experienced meteoric growth and unsustainable price appreciation over the past few years, or cities like Detroit, which are undergoing a more widespread economic downturn along with higher unemployment rates," We have loads of rust belt north of London but where is the UK equivalent of the Sun Belt?

Posted by happyrenterz @ 08:28 AM 3 Comments

Struggle Street

Sydney Morning Herald: Welcome to the new Struggle Street

Welcome to the new Struggle Street - the middle class, suburban Sydney road where four houses in a row of six have been repossessed within 10 months of each other. One expert warned that a combination of rising interest rates, stagnating house prices and irresponsible lending had created a "time bomb of loans that is probably going to implode".

Posted by jd @ 07:38 AM 1 Comments

Barrett sale price fraud

BBC: Bursting the House Price Bubble

This report details how Barrett have been giving incorrect sale prices to land registery, there was me thinking this would be classed as fraud?

Posted by zippys @ 06:55 AM 0 Comments

This site has been saying it for years.

Telegraph: Standard of living will fall, warns Mervyn King

Families have been warned to expect a decline in their standard of living as rising food and fuel prices place household finances under severe strain. Would UK economic policy be better served by following the ideas in random late night HPC blog comments (probably after coming back from the pub) rather than professional economic advisers? Yes - probably, the evidence emerging seems to suggest so.

Posted by housing carbuncle @ 02:14 AM 16 Comments

Wednesday, February 13, 2008

Advantage - shutting up shop!

Bloomberg: Morgan Stanley to Cut 1,000 U.S., U.K. Mortgage Jobs

Morgan Stanley, the second-biggest U.S. securities firm, will eliminate 1,000 jobs by scaling back its U.S. residential mortgage business and closing the Advantage Home Loans unit in the U.K. Morgan Stanley bought Advantage in December 2005.

Posted by alan @ 08:35 PM 0 Comments

What if the banks start offloading their portfolios period....

CBS News: "Jingle mail:" The Awful Sound Of "Voluntary" Foreclosure

As the foreclosure crisis deepens, banks and lenders are talking openly about one of their worst fears: "jingle mail" the phrase that describes what happens when a borrower gives up on a house and a mortgage, and simply mails the keys back to the lender and walks away from the mortgage. What did we just see Egg do? that's right, penalise good customers. What makes you think a bank won't start selling homes where the mortgage payer is bang-up-to-date, simply because a "repossessed property" due to default fetches less at auction. Wait and see. Stranger things have and yet will happen.

Posted by lvmreader @ 08:31 PM 29 Comments

Second Home Owners Panic?

Brighton Argus: Make use of empty homes to ease crisis

This article seems reasonably mild, but that doesn't stop a sense of panic in the responses. Some of the residents of Brighton worried that their second homes might be 'nationalised' perhaps?

Posted by captain sensible @ 06:20 PM 11 Comments

Negative Equity

Bloomberg: Americans Selling Homes See Prices Go Below Mortgage

America learns all about negative equity, although they don't seem to use that phrase yet. "Thirty-nine percent of people who purchased a home two years ago already owe more than they can sell it for" ``It comes to the point where you have to decide: Do I want to take a big loss now or an even bigger loss later?''

Posted by ontheotherhand @ 05:15 PM 6 Comments

BTL Preferred?

BBC: Home ownership dips to decade low

"Home ownership in England fell for the second year in a row last year, sliding to its lowest level since 1998, according to government statistics". "Critics complain that many buy-to-let landlords have been able to obtain bigger mortgages, financing more expensive house purchases, than other ordinary buyers could normally afford".

Posted by alan @ 04:43 PM 6 Comments

Get them out before they become a squatter!

Telegraph: Squatters rights for mortgagee who didn't pay

I wonder how many poor stretched home-owners contemplated life as a squatter when they read this, before they realised that this court ruling probably means they won't even get that option...

Posted by jackas @ 04:24 PM 0 Comments

David heard things that Mervyn never said! In fact King said that housing market is at risk from the credit crunch!!!!

DavidCharlatanSmith: Inflation report: Rates to fall not plunge

This is pure transvesting the truth for the benefit of VIs. King never said "said that house prices should be in for a long period of stability"!!! But in the opening remarks (link posted in Smith's blog) King said: "The impact of tighter credit conditions is apparent in property markets, and is particularly likely to affect investment in commercial and residential property and perhaps business investment more generally"

Posted by confused76 @ 02:31 PM 25 Comments

City of London Police are set to produce a report on mortgage fraud

Citywire: New-build property scam worse than feared, FSA warns

The new-build property fraud carried out by criminal gangs is more serious than originally feared, the regulator admitted today, with more than 200 cases already under investigation and more appearing every day. The scams appeared to be run by organised rings, using mortgage and property fraud to make significant profits', FSA crime director Philip Robinson told a Council of Mortgage Lenders fraud seminar.

Posted by jack c @ 02:31 PM 6 Comments

Have the Swedes got it right?

BBC: Sweden surprises with rate rise

"Sweden's central bank has raised interest rates by a quarter of a percentage point to 4.25%". "The Riksbank said the move will help bring down inflation, which is running at 3.5%, well above the target of 2%".

Posted by alan @ 01:48 PM 8 Comments

And now it is a true basket case

Times: Bank of England Governor, Mervyn King, admits inflation will trigger new Alistair Darling letter

"The prospect of an immediate interest rate cut receded further today as Mervyn King, the Governor of the Bank of England, conceded it was odds-on he wouldhave to write an explanatory letter to the Chancellor as inflation heads towards 3 per cent" so let us summarize: no IR cuts, further slowdown, recession, then cuts, then the pound falls to 1.5 against dollar, more inflation, rates go up again, immigration stops, lots of empty city flats. Could all of this been prevented? YEEEEESS! keeping rates up in the first place and regulating BTL mortgage lending. Brown + Darling --> Dustbin of history

Posted by confused76 @ 01:06 PM 15 Comments

Why Buffetts bail-out cant save the US economy

MoneyWeek: Warren Buffett gives the bond insurers a good kicking

Warren Buffett has offered to relieve the ailing monoline insurers of their best assets, leaving them the subprime rubbish. You've got to admire his ruthlessness. But are the monolines desperate enough to accept?

Posted by mary @ 12:31 PM 3 Comments

Gold correcting

Market Oracle: Gold Price Out of Synch With US Dollar Index, Expect Sharp Decline

I am not sure where gold will correct to (maybe 800-850) but this correction is necessary for the final surge up in Elliott wave 5. This kind of gold blow-off last happened in May 2006.

Posted by sold 2 rent 1 @ 12:19 PM 28 Comments

Hurry up Darling and rescue them, there's a good chap

Firstrung: Bad debts up threefold, profit halved, mortgage arrears nearly double at buy to let specialist Bradford & Bingley

Bradford & Bingley, the UK's biggest buy-to-let lender, has seen its mortgage arrears leap by a huge 42 per cent in 2007. Their bad debts trebled as more homeowners struggle to keep up with repayments. Pressure on borrowers contributed to a threefold increase in bad debt charges to 22.5 million, from 7.4 million in 2006. Writedowns have reduced the lender's statutory pre-tax profit by 49 per cent to 126 million in the full year to 31 December...

Posted by converted lurker @ 11:56 AM 12 Comments

Successful handover complete

Firstrung: Over one in five adults of working age economically inactive

The trend in the employment rate is increasing but the trends in the unemployment and inactivity rates are falling. There has been a further fall in the number of people claiming Jobseeker's Allowance benefit. The number of job vacancies has increased. Growth in average earnings, excluding bonuses, has increased, but earnings growth including bonuses has fallen...

Posted by converted lurker @ 11:55 AM 5 Comments

Insight to what is ahead

Safe Haven: The Plague of the Witch Doctors

Many of us in Bear Country don't insist that a Great Depression is coming. In fact we insist that what is coming is NOT going to be a depression as we have known such a phenomenon in the past. This time, it will be different because our political and monetary authorities have learned some things from their last escapade in economic humbuggery during the 1930s. In fact Bernanke is a devout student of that period and his Fed has acquired several new ways to shore up the Keynesian system. So things will be extended this time. Not healed, or solved, just extended. And in the process, exacerbated. We bears see Bernanke and the Fed as nothing but gussied up monetary witch doctors with an array of fiscal gimmickry and crypto agencies which they can draw upon to defend their paper paradigm

Posted by sold 2 rent 1 @ 11:48 AM 0 Comments

The UK's subprime problems have arrived

BBC "News": Sub-prime dominates repossessions

"Sub-prime lenders are bringing more than half of UK repossession orders, despite accounting for just 6% of total mortgages, a BBC report has found."

As well a BBC report might find that to be the case.

The reality is somewhat different - "Non-conforming" lending including buy-to-let, self certificated mortgages, equity release and subprime represents 30 per cent of the market according to the Intermediary Mortgage Lenders Association (IMLA).

Posted by paul @ 11:29 AM 3 Comments

BTL Bubble, OECD: UK homes 40% overvalued

FTAlphaville: Markets LIVE, Numis report quote

"Buy-to-Let (BTL) bubble: BTL has supported the UK property market, for the first time allowing property to fund property purchases. In Q1 1999 there were 11,100 BTL mortgages against 119,300 first time buyers (FTB). By Q3 2007 BTL volumes were up 750% with FTB numbers down 19%. For property prices to have tracked income growth over the past 25 years house prices would need to fall by over 44%. The OECD and IMF also believe that the UK property market is at least 40% overvalued. B&B is the most exposed stock we cover to the property market. If BTL is deemed to have been mis-sold (we can not see how it is appropriate to hold 1000% of your net worth in one asset class) B&B is bankrupt."

Posted by guiriduro @ 11:22 AM 6 Comments

House price trend at worst level for 16 years

The Times: Business News Article

A similar article to that elsewhere. I remember 1992 with some affection actually.

Posted by orwell @ 10:20 AM 0 Comments

The property bubble predators

MoneyWeek: Why thousands of people have overpaid for property

Every bubble has its predators. During the property bubble, it was the developers and buy-to-let clubs who offered new-builds 'below market value'. Get ready for a wave of repossessions across the nation's city centres...

Posted by mary @ 10:19 AM 5 Comments

Another one goes... Bradford & Bingley

CityWire: Higher than forecast write offs knock Bradford & Bingley for six

After Victoria Mortgages, Kensington, Northern Rubbish and Para-gone, it is the turn of kissing BB ByeBye

Posted by confused76 @ 10:07 AM 9 Comments

Property stock exchange closes

ft.com: ft

Property stock exchange closes By Daniel Thomas Published: February 13 2008 02:00 | Last updated: February 13 2008 02:00 The UKs only residential property stock exchange has been forced to close after failing to raise sufficient funds to meet European financial regulations. The Property Investment Market was an innovative attempt to encourage widespread residential investment in the UK. It would find and then list residential properties on its online exchange, in which investors could buy shares for as little as 1 ($1.9).

Posted by alan king @ 09:51 AM 0 Comments

Gloom? We're overjoyed! Your gain was our misery, now your misery is our gain!

BBC "News": Surveyors' "gloom" at house prices

"A lack of demand and confidence in the housing market is clearly behind the recent price slowdown," said Rics spokesman Jeremy Leaf.

But ... but .. immigrants and overcrowding and erm ... small island and Olympics and umm ... immigrants ... ?

Posted by paul @ 09:48 AM 3 Comments

Why a recession won't push down the cost of living

MoneyWeek: Why a recession won't push down the cost of living

Worried about inflation...? Oh stop your carping and set an extra place at dinner for the fast-looming recession instead. Your cost of living can NEVER go up during a recession, right...? But remember, that near-perfect connection between money-supply growth and consumer-price inflation is one of the few clearly established facts in economics. Over a 30-year horizon, they match each other almost exactly. Which is to say they won't necessarily move together this week or next.

Posted by mary @ 09:46 AM 1 Comments

Goldman Sachs says US house prices may fall by as much as 25pc from peak to trough

The Telegraph: US credit crisis escalates as defaults spread

US house prices have fallen by 7.7pc over the past year, according to the Case-Shiller index of the 20 biggest cities. The slide is likely to gather pace as 2.2m mortgages taken out at the height of the credit bubble adjust upwards by 250-300 basis points. Goldman Sachs says house prices may fall by as much as 25pc from peak to trough - creating the worst slump since the Great Depression.

Posted by sold 2 rent 1 @ 09:35 AM 3 Comments

Pickfords could become the first high-profile British casualty from the slowdown in the UK housing market

Times: Crisis at Pickfords puts 1,300 jobs at risk

Pickfords, Britain's oldest and largest removals company, is on the verge of a fire sale to avoid a financial crisis that would put up to 1,300 jobs at risk, The Times has learnt. The loss-making company is trying to sell some or all of its business as it seeks to secure additional funding to help to pay staff and creditors. If it failed, Pickfords would become the first high-profile British casualty from the slowdown in the UK housing market and the collapse of the American property sector.

Posted by jack c @ 09:31 AM 0 Comments

Mortgage lenders are becoming increasingly concerned about the looming shortfall in funding

Citywire: Mortgages: Waiting for the big liquidity freeze to thaw

Mortgage lenders are becoming increasingly concerned about the looming shortfall in funding. The Council of Mortgage Lenders (CML) is lobbying the Treasury and Bank of England to help solve the liquidity problem in the hope that the securitisation market, on which many lenders rely, can be reopened. The freeze has already taken out buy-to-let lender Paragon and there are fears that the continuing shortage of funds will create problems, not just for homebuyers (and sub-prime borrowers in particular), but for everyone as it spills over into the wider economy, precipitating a general slowdown if not recession

Posted by jack c @ 09:17 AM 4 Comments

B & B loses a lot of money but is presented with a 'unique set of challenges and opportunities' and guess what is keeping them going - 'strong fundamentals'

BBC News: Bradford & Bingley profits slide

"Lender Bradford & Bingley (B&B) has reported a sharp fall in profits after cutting the value of risky assets following the recent market turmoil. Pre-tax profit almost halved to 126m in 2007 from 246.7m the year before." - Then there is a good bit of spin here "B&B said that if it stripped out what it termed "unusual and extreme external events" then underlying profits rose 5% to 351.6m". So that's alright then!? - "There is no denying that today's market circumstances present the mortgage industry with a unique set of challenges and opportunities," B&B said. "We believe the fundamentals that drive our specialist markets remain strong, and expect the buy-to-let market to continue to grow at a faster rate than the mainstream mortgage market," it added."

Posted by alanl @ 08:56 AM 3 Comments

The vicious circle that trapped America

The Times: Business News Article

It would seem that even the US are owning up to the fact that they have simply spent too much and that they will have to readjust...

Posted by orwell @ 08:22 AM 1 Comments

Simply absurd in our mad, mad, mad, mad world

Daily Telegraph: Simply absurd in our mad, mad, mad, mad world

"The credit crunch (and its genesis in the sub-prime mortgage swamp) reflects monolithic madness. Lending enormous sums to people whose main source of income is a welfare cheque was bizarre enough. But pouring their obligations into a cocktail shaker and expecting it to produce triple-A securities is bonkers"

Posted by becky @ 07:30 AM 9 Comments

Not just the RICS: Almost Everyone agrees

Times: House prices set to fall by 7% in next two years as credit squeeze bites

"Goldman Sachs said it expected house prices to fall by 5 per cent this year and a further 2 per cent in 2009. The bank had originally predicted a decline of 3 per cent in 2008 and no further change the year after, but became more pessimistic after economic warning signs." They should know, they've looked at the Northern Rock for quite some time. Surely noone (apart from the Express) is going to disagree?

Posted by growler @ 07:28 AM 5 Comments

US credit crisis escalates as defaults spread

TELEGRAPH UK: Defaults in the US housing market are spreading from sub-prime to the much larger stock of top-grade housing debt, threatening to set off a wave of even bigger losses for banks and investment funds.

The Mortgage Bankers Association says default rates on all outstanding home loans in the US have reached 7.3pc, the highest level since modern records began in the 1970s. Arrears on "prime" mortgages have reached a record 4pc, confounding expectations that middle-class Americans with good credit records would be able to weather the storm. While sub-prime and close kin "Alt A" total $2,000bn (1,019bn) of debt, the prime market in all its forms is roughly $8,000bn. If prime default rates rise on their current trajectory, they could ultimately cause huge financial damage.

Posted by chris @ 03:27 AM 1 Comments

House prices fall in January

RICS: RICS UK Housing Market Survey January 2008

Please don't post thousands of articles citing this same source - these are the source figures from RICS, there is nothing that the BBC or Guardian or Times can add to it. Bold text is as per the source article. "The balance of surveyors reporting house price falls increased again in January. The RICS house price balance dropped for the sixth month in succession signalling half a year of negative market sentiment. The decline in demand picked up speed as new buyer enquiries fell at the fastest pace since October. The stock of unsold property on surveyors books jumped by more than 10 percent and has increased by in excess of 40 percent since September 2007. Currently the average level of unsold property per surveyor is at the highest level since February 1999."

Posted by drewster @ 03:15 AM 11 Comments

Tuesday, February 12, 2008

Auckland prices plummet

NZ Herald: Residential property "Buyers' market"

NZ prices over the edge as reality bites. National median price down from $345,000 to $340,000. Auckland City prices plummet from $510,000 in Dec 07 to $433,000 in January 08 - more than 15% in one month. Vested interest, the Real Estate Institute of NZ, tries valiantly to put the figures down to holiday factors and focus attention on annual figures, which are still positive for the country as a whole (3% since Jan 07). Number of sales in Jan 08 5,186 compared with 7,566 in Jan 07. Days to sell has blown out 49, the highest figure since 2002. Number of $1m plus properties sold nationally dropped from 186 in December to 119 in January.

Posted by fjr @ 11:50 PM 0 Comments

SImply not sustainable

Daily Mail: First time buyers spend 35% of take home pay on mortgage

First-time buyers are spending more than a third of their take-home pay on their mortgage, official figures revealed yesterday. In a deeply worrying sign, it is the highest level since the last property crash in 1991. Financial advisers warned that massive mortgages are "a disaster waiting to happen". The situation may be even more serious than it was in 1991 because so many other costs are soaring.

Posted by little professor @ 11:34 PM 2 Comments

Spain thoroughly crunched

Euro2day: Spanish banks' reliance on ECB surges with 44bn borrowing

The European Central Bank has effectively funded new lending in Spain in recent months, replacing banks' use of wholesale capital markets, which have been strangled by the global credit crunch. Spanish banks doubled their share of the ECB's weekly funding auctions in the final quarter of last year, taking their borrowing up to 44bn in December from a running average of about 20bn over the previous 15 months, according to the most recent data from the Bank of Spain.

Posted by alan @ 10:57 PM 2 Comments

Japan is the next sub-prime flashpoint

gata: Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East.

The Tokyo bourse has crumbled, suffering the worst start to the year since the Second World War. The Nikkei index is down 17 per cent since Christmas, and the shares of Japanese banks are leading the slide. Mizuho Financial, Mitsubishi UFJ and Sumitomo Mitsui have all been punished as hard or even harder than those US banks at the epicentre of the sub-prime debacle.

Posted by chris @ 08:55 PM 2 Comments

Which Bank is Most Cash Desperate

BBC: Savers 'escape' recent rate cuts

The Alliance and Leicester are currently advertising 12% for a year on TV to entice new regular deposits which beats all the figures in this BBC article. After years of stingy saving rates this is all starting to sound a little desperate.

Posted by enuii @ 08:20 PM 7 Comments

Who the hell is running this country?

Times: Darling backtracks on 'non-dom' charge

Alistair Darling has dropped key parts of his controversial plans to tax non-domiciled foreigners living in Britain in the face of unprecedented opposition from business and the City. The Chancellor, faced with a growing political storm over his so-called "non-dom" tax proposals, outlined his u-turn in a letter sent today to tax lawyers and specialist accountants, a copy of which has been passed to The Times.

Posted by jack c @ 07:06 PM 20 Comments

Almost 6% Drop in London House Prices from Q3 to Q4 2007

BBC News: UK House Prices

The BBC today (12 Feb.) updated their "UK House Prices" data based on figures provided by the Land Registry of England and Wales. The figures show a 5.7% drop in the average house price in Greater London from Q3 to Q4 2007, based on over 32,000 sales. The City of London leading the way with a drop of 17.5% (yes 17.5%). Merton (down 13.1%). City of Westminster (down 11.1%). Lambeth (down 10.7%). Camden (9.7%). Hamersmith and Fulham (down 7.5%). Richmond upon Thames (down 7.1%). Enough said!!!!!

Posted by pam @ 06:10 PM 9 Comments

Recession looming

BBC: Trade deficit worse than expected

Foreigners are turning away from UK products as they realise that 75% of the cost is nothing to do with what they are buying, but goes directly to public sector workers in Scunthorpe. Apparently Johnny foreigner even wants more cash back for their own goods due to something to do with interest rates and a Labour government.

Posted by stillthinking @ 06:10 PM 4 Comments

Munis "Rescued" No CDOs though

CNN.com: Treasurys sell off on Buffett muni offer

Buffet offers to Reinsure $800 bn of munis, they think its all over?!?!? Big up the FTSE.

Posted by techieman @ 04:46 PM 8 Comments

Yet another reason for lenders to tighten their rules

Daily Mail: Man who refused to pay mortgage for 15 years is granted 'squatters' rights'

"However, banks have warned the decision by top judges to wipe out Djabar Babai's arrears could lead to tougher early action by lenders. An increased number of vulnerable home owners could be forced onto the streets by banks fearing they will lose their money."

Posted by becky @ 04:34 PM 6 Comments

I no longer care about house prices!!!

Key worker scheme: Free from the rat race!

Well guys,. crazyness. I just bagged me a self contained studio flat in zone 1 for 90/week on the key worker scheme. 5yr tennancy. House prices would need to go down about 90% now to make it worthwhile for me to buy, so I no longer give a s%^t!! :-) I would hate to be a buy-to-let person competing with this type of deal, yer, a small part of the market, but there are some good deals out there!! Hopefully I'll have enough cash saved at the end of the 5yrs to buy a flat out right, once house prices are bottomed up. So, there are ways to insulate yourself, if you look hard enough. Maybe others have some tips on how to protect our wealth against the housing market and the high inflation that is here and on the way? Any stories from the coal face?

Posted by planning4acrash @ 04:05 PM 18 Comments

It is not contained...

NY Times: Mortgage Crisis Spreads Past Subprime Loans

It's not just subprime anymore and it's not contained: "Until recently, people with good credit, who tend to pay their bills on time and manage their finances well, were viewed as a bulwark against the economic strains posed by rising defaults among borrowers with subprime credit." Now, however, the collapse in home values is sucking in borrowers of all classes. Why? Because "banks are responding to the rise in delinquencies by capping home equity lines of credit in areas with falling real estate prices." The easy money is gone.

Posted by an bearin bui @ 03:07 PM 3 Comments

It's petrol's fault that everything's so expensive

Charcol Home & Money News: Petrol drives inflation up to 2.2%

The Office for National Statistics (ONS) says that Consumer Price Index (CPI) inflation increased by 0.1% for the 12 months to January, compared to December's figure of 2.1%. It attributes much of the increase to the rising prices of fuel and food.

Posted by tamsin bishton @ 03:06 PM 1 Comments

Goldman Sachs predicts -5% and -2% UK house price decline in 08/09!!!

CNN: UK house prices seen down 5 pct this year as economic outlook weakens

This is like a death sentence. "The broker has lowered its house price growth assumption down from its November consensus forecast of a 3 pct fall for this year and 0 pct in 2009, and has also become more bearish on volumes. It now expects a 16 pct fall in volumes this year, compared to 11 pct before, following recent trading updates from UK housebuilders showing forward order books down by over 10 pct with the key Spring selling season still to come. Over the next month, it expects housebuilders to report a fall in buyer activity during the Spring selling season as tighter credit, falling house price growth expectations and falling mortgage approvals feed through to weaker demand" YIIIEPPPEEEEEEEE

Posted by confused76 @ 02:57 PM 2 Comments

Latest update on suspected mortgage fraud

Mortgagestrategy: EXCLUSIVE: FSA probes 200 brokers for fraud

Some 200 brokers are under investigation by the Financial Services Authority in connection with mortgage fraud. In an exclusive interview with Mortgage Strategy, Philip Robinson, director of financial crime and intelligence at the FSA, revealed this morning that the regulator plans to release the names and enforcement action for those involved in fraudulent dealings next week. Robinson says that repercussions for brokers under investigation will vary depending on the severity of their involvement in the crime. They could range from regulatory reviews to criminal charges.

Posted by jack c @ 01:55 PM 13 Comments

No more comments - shut up everyone!

David Smith's Economicsuck.com: CPI 2.2%, RPI 4.1%

With the growing barrage of criticism at his shortsightedness and lack of analytical rigour, David Smith has had a hissyfit and closed the comments facility on his site. On the one hand I think its good, although he still has his job at The Sunday Times to spout claptrap regarding his ill-conceived skip index. On the other hand it's a shame really. I enjoyed having a look every once in a while, not so much for his inane posts but to relish the hammering he always used to get in the comments section from his readers.

Posted by paul @ 01:44 PM 9 Comments

UK Title: A Pathological Bubble for Homeowners

NY Times: A Psychological Bubble for Homeowners

Denial can be a powerful psychological force. According to a survey released earlier this week by Zillow.com, the real estate Website that calculates home values, denial is precisely what appears to be at work in the minds of many homeowners across the United States. They have managed to convince themselves that, despite ample evidence to the contrary, their homes actually increased in value in 2007, or remained the same.

Posted by yt1 @ 01:20 PM 2 Comments

How to frame bad news.....

FT.com: UK inflation growth weaker than expected

Classic use of a framing device, make out that the measure was not as bad as expected..... ''Consumer price inflation rose less than expected in January, but edged farther above the Bank of Englands 2 per cent target as higher food and petrol prices took effect, official data showed on Tuesday. ''

Posted by hpwatcher @ 01:17 PM 2 Comments

Boom ends

BBC: Home loans drop 35%, lenders say

The number of new mortgages granted to home buyers slumped to just 62,000 in December 2007, according to the Council of Mortgage Lenders (CML).

Posted by doomwatch @ 12:49 PM 2 Comments

credit crisis is no longer just a subprime mortgage problem.

nytimes: This collapse in housing value is sucking in all borrowers, said Mark Zandi, chief economist at Moodys Economy.com.

. As home prices fall and banks tighten lending standards, people with good, or prime, credit histories are falling behind on their payments for home loans, auto loans and credit cards at a quickening pace, according to industry data and economists The rise in prime delinquencies, while less severe than the one in the subprime market, nonetheless poses a threat to the battered housing market and weakening economy, which some specialists say is in a recession or headed for one.

Posted by chris @ 12:40 PM 1 Comments

dLoss / dt as we'd say in Engineering

FT.com: Table: Subprime-related losses at major banks

This is a moving target, but gives some insight. Where are all the rest of the bodies buried?

Posted by lvmreader @ 12:16 PM 2 Comments

Up up and away in my beautiful balloon

Firstrung: Rising inflation dampens hopes for further interest rate cuts in 2008

Figures from the Office for National Statistics today show that consumer prices index (CPI) annual inflation - the Government's target measure - was 2.2 per cent in January, up from 2.1 per cent in December... The largest upward pressure came from an increase in the price of road fuels. Average petrol prices rose by 1.3p in January to stand at 103.9p per litre, compared with a fall of 0.8p a year ago. There was also a large upward effect from food, particularly fruit, such as grapes and grapefruit, where prices fell by less than last year. There was a further large upward contribution from furniture where, overall, price reductions in the January sales were less than in the previous year.

Posted by converted lurker @ 12:04 PM 12 Comments

food and fuel prices rise at their fastest rate for 17 years

The Telegraph: Families hit with 1,300 rise in cost of living

Families are having to pay an extra 1,300 a year in household bills as food and fuel prices rise at their fastest rate for 17 years.

Posted by sold 2 rent 1 @ 11:56 AM 8 Comments

Mortgage approvals fall from 125,000 to 75,000 in January

Firstrung: Mortgage approvals for January down 38% vis a vis January 2007

This is what Connels say: "Mortgage approvals for house purchase rose 3 per cent in January according to the latest data from Connells Survey & Valuation. Mortgage approvals rose to 75,300 in January from their December low of 73,000 representing the first increase in mortgage approvals since May 2007" This is the reality: However, approvals have fallen 38% compared with January 2007, when almost 125,000 mortgage were approved, while approvals have reached their worst January level since Bank of England records began in 1994. and the mainstream 'meeja' wonder why some folk are suspicious (at best)

Posted by converted lurker @ 11:11 AM 11 Comments

The horrible truth about inflation

MoneyWeek: The grim truth about inflation: it just won't go away

Despite the impending global slowdown, inflation is still very much a threat. And it's about more than rising food and energy prices too - import prices are also on the rise. It looks like interest rates won't be falling as fast as the City had hoped.

Posted by mary @ 10:49 AM 5 Comments

A must read article - This could apply to property too.

Freemarket Gold & Money Report: The Confiscation Threat

This is a very interesting article indeed. An exert: Greenspan then goes on to say: "The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves. This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard." Also read: http://www.fgmr.com/whatgold.htm "What Is Happening to America's Gold?"

Posted by stevie dee @ 10:43 AM 1 Comments

It can't happen over here!

Guardian: Auctioneers bring down hammer on America's broken dreams

"California is at the very heart of America's property slump. The California Association of Realtors reported that home sales dropped by a third last year and the average house price was down by 16.5%." Thankgoodness all of our UK BTL subprime are in it for the long term, eh? Otherwise the possibility of this kind of event happening in UK would really frighten me.

Posted by inbreda @ 09:54 AM 1 Comments

Same paper shouting about house prices this morning?

Daily Express: FOOD PRICE RISES ARE BIGGEST EVER

FOOD prices are soaring at their fastest rate since records began, threatening fresh misery for millions of hard-pressed families. No doubt that supports their earlier theory on house prices 'rallying'.

Posted by it_is_going_with_a_bang @ 09:53 AM 8 Comments

More lies......

BBC: UK inflation picks up in January: 2.2%, up from 2.1% in December

Last month's Consumer Prices Index (CPI) figure - the government's preferred measurement - rose to 2.2%, up from 2.1% in December. The biggest inflationary pressure was rising transport costs, the Office for National Statistics (ONS) said. The Retail Price Index (RPI) inflation measurement, which includes mortgage interest payments, rose to 4.1% from 4% in December.

Posted by hpwatcher @ 09:51 AM 6 Comments

Basics - IPODS, TVs down, Luxuries Food & Fuel up

BBC: UK inflation picks up in January

Last month's Consumer Prices Index (CPI) figure - the government's preferred measurement - rose to 2.2%, up from 2.1% in December

Posted by holding out @ 09:50 AM 0 Comments

Primelocation Report: good spin!! but market data are as bad as they can be

Primelocation: House price index January 2008

Price data show a pretty grim picture. Sale and rental prices are still below the pre-credit crunch levels, and the so much heralded "reduction of inventory" may just be an effect of the Christmas break. Inventories are still 60 to 70% higher than any month pre-credit crunch. but we know that London sales volumes have collapsed (Land registry) so where did the stock go? "due to market uncertainties vendors are using a cautious approach pulling properties from the market".... aaaaaa... so we will find a larger stock of properties to rent!!! With "corporate rentals on the vane" expect the BTL nightmare to begin!! AHGAHHA AHHAH AHAH

Posted by confused76 @ 09:28 AM 2 Comments

Significant number of repossessions at Allsop Feb Auction came from buy-to-let investors

Telegraph: No let-up for buy-to-let

Anxiety over the state of the property market in Britain shows no signs of letting up. As the major auction houses gear up for their February sales, there are worrying signs. Savills says it has seen an increase in the number of repossessed properties - and it expects this trend to continue over the coming months.

Posted by jack c @ 09:21 AM 5 Comments

Down 1.7% in Jan

Home.co.uk [pdf]: House prices fall in all regions

The home.co.uk asking price for properties in England and Wales dropped sharply this month by 1.5%, equivalent to an average reduction of 3,870. The year on year figure has fallen to just 3.7%. After six months of hopeful stagnation, it is evident that asking prices are now being cut by increasingly desperate sellers. Moreover, market sentiment continues to deteriorate as buyers play a waiting game in the knowledge that prices are falling. A nightmarish scenario for sellers: Waiting for an elusive buyer as 000s of pounds are wiped off the value of the property for sale every month. This is the psychology of a house price crash.

Posted by little professor @ 08:30 AM 11 Comments

Stagflation dragon stirs as factory prices soar

TELEGRAPH UK: The worst of all possible worlds is when inflation rears its ugly head even as growth slows. Stagflation holds a special place in the dark corners of economists' minds because it renders a central banker's monetary armoury powerless to fight a uniquely de

invented a new index yesterday. From 2003 to 2007 it ran like this: 600, 1057, 1592, 1588, 1822. To be known as Stevenson's Stagflation index (SSI), it measures the number of articles in which my press cuttings database finds a mention of that unholy combination of sluggish growth and rising prices. As you can see, the SSI has been in a serious uptrend

Posted by chris @ 06:35 AM 0 Comments

American International Group, the world's largest insurer by assets, is to take a $4.88bn (2.5bn) writedown as it became the latest victim to fall prey to the credit crisis

TELEGRAPH UK: AIG's $4.88bn hit knocks insurance shares

American International Group, the world's largest insurer by assets, is to take a $4.88bn (2.5bn) writedown as it became the latest victim to fall prey to the credit crisis

Posted by chris @ 06:33 AM 0 Comments

area next to be affected in the coming months

dandodiary: There are also concerns that problems in the subprime mortgage industry could spread to auto and truck loans.

There are also concerns that problems in the subprime mortgage industry could spread to auto and truck loans. As discussed in a November 20, 2007 Associated Press article entitled "Analysts Fear Auto Loans Next Problem" (here), the major auto and truck lenders are already experiencing rising delinquency levels. One analyst is quoted as saying that there is no question that the mortgage woes will spill into car and truck financing. "The only question is how big a worry it is."

Posted by chris @ 06:26 AM 0 Comments

Sounds like a high stakes poker game

The Guardian: The central bankers can't all be right

So who has got it wrong? The honest answer is we don't know and are unlikely to know for some time. In the short-term, the Fed would consider it a job well done if lower short-term interest rates helped stabilise the housing market; it would, though, be a pyrrhic victory if cheaper money simply led to another episode of the bubble economy.

Posted by stevie dee @ 02:57 AM 0 Comments

Tightrope for BoE

FT: Retail data to damp UK rate cut prospects

Expectations that the Bank of England will embark on a raft of interest rate cuts are to be undermined by figures on Tuesday showing high street sales were stronger than expected in January.

Posted by stevie dee @ 02:29 AM 0 Comments

You knew this was coming

Daily Express (of course): SHOCK RISE IN HOUSE PRICES

Home owners were given much-needed cheer last night with the news that the average price of a house went up by almost 1000 to 219,591 in December. The 0.4% surprise rally defies the doomsayers who had been predicting a big slump. Stuart Law, chief executive of property investment company Assetz, said: Here is yet another piece of evidence that property prices are firming up, ready for the annual spring rise, which flies in the face of doomsayers. There is plenty of hard evidence that the market is, in fact, starting to grow again. There is no evidence of a house price crash whatsoever.

Posted by little professor @ 01:09 AM 39 Comments

BOE Cuts Rates and Warns of Inflation - WHAT is going on!?

Telegraph: Bank of England likely to miss Inflation target

The Bank (BOE), which last week cut interest rates by a quarter percentage point to 5.25pc, is expected to raise its near term projection for the Consumer Price Index, implying a significant chance that it will rise above 3pc, forcing the Governor to write a letter of explanation to the Chancellor. It follows news that the majority of Britain's major gas and electricity suppliers have raised their prices by an average of 15pc and 12pc respectively." So why bother collecting data, why bother meeting, why bother cutting rates, indeed why bother at all. We are all on our own, its actually worse. BOE clowns are steering UK onto rocks

Posted by hyrax @ 01:06 AM 0 Comments

Monday, February 11, 2008

More good news

My Finances: House prices down 0.3%

UK property prices fell by 0.3 per cent in January, but fears of a market collapse are groundless, according to the latest housing survey. Chesterton's Poll of Polls conducted by the Centre for Economics and Business Research (CEBR) found the average price of a property was 146,662 last month, compared to 140,276 in January 2007 - revealing prices have increased over the year.

Posted by bufferbear @ 08:49 PM 11 Comments

Is this it?

In The News: 2008 the year of the house price crash?

The UK housing market is bracing itself for its worst 12 months for more than a decade. So says the Royal Institute of Chartered Surveyors (Rics), which claims market conditions have not been so adverse since the early 1990s. In January house price indices reported falls and static growth across the board, continuing the faltering trends of the autumn and winter of last year. Despite the bleak picture, property experts have been emphasising the positives, however scarce they may be, as for every worried homeowner there is a very eager first-time buyer eyeing the house price falls with glee.

Posted by bufferbear @ 08:41 PM 1 Comments

UK Property prices down French Property prices going up

Hiday.net: The French Property Market

With the unpredictable down turns of the global stock market and the uncertainty regarding the major world property markets ( in particular the USA and the UK) investors are becoming more cautious about buying a second home. However despite this some countries around the world are still experiencing steady growth - places like Brazil, Turkey, Greece, Germany, China, Bulgaria and France. Of this list France can arguably be described as having the most stable property market at the moment.

Posted by john84 @ 07:55 PM 0 Comments

This is a very, very ominous sign

Telegraph: Standard Chartered's SIV forced into receivership

Whoopsie

Standard Chartered has been forced to place Whistlejacket, the structured investment vehicle (SIV) it manages, into receivership after credit market problems slashed the value of the SIV's assets in half. The specialist Asian lender was preparing to bail out Whistlejacket with a $7.15bn funding line before a sudden collapse in the value of the assets triggered today's "enforcement event". Under the rules governing the SIV, a receiver has now had to be called in.The action will be a severe embarrassment for Standard Chartered, which has had months to address the problems at Whistlejacket - the first UK SIV to go into receivership. It first took a cautious approach last year by slicing the assets up between investors, taking $3.3bn itself for its own 25pc equity stake.

Posted by lvmreader @ 06:03 PM 3 Comments

Oh poor them!

The Press Association: Being rich is more expensive - bank

A study of the spending habits of 14,000 holders of the bank's exclusive World Card - those with a minimum of 5 million in property and savings - found inflation on premium goods and services running at 9.5% in the past year. This is more than four times higher than the official Consumer Prices Index inflation, which currently stands at 2.1%.

Posted by disillusioned @ 05:57 PM 0 Comments

MPs remortgaged their homes, even though their mortgages are paid by the taxpayer, to take out cash in hand

Mortgagestrategy: MPs remortgaged homes for cash, say reports

MPs remortgaged their homes, even though their mortgages are paid by the taxpayer, to take out cash in hand, say reports. The Times says Andrew Walker, the director of finance and administration in the House of Commons, has admitted that until 2006, MPs were able to remortgage their properties to release cash, even though their mortgages were paid for by the taxpayer.

Posted by jack c @ 03:09 PM 20 Comments

Ztuart Law railz against VI's

Assetz: When is a positive a negative? When it's a house price story

There isn't any more blatant evidence of the press attempting to talk down the market than this. The FT at the weekend managed to convert a rise in property prices in January to a fall in property prices instead by a strange use of wording. "House prices see second monthly fall" was the headline and yet they then say house prices fell in November/December but rose in January. Then we get the BBC today saying the property market continues to fall, choosing to quote the annual rate of growth in order to make sure they can show a declining trend of house price growth, and yet the figures from the DCLG state that prices rose 0.4% in December. From my research it does appear there is an unusually large percentage of journalists that rent rather than own their own homes.

Posted by little professor @ 02:02 PM 18 Comments

Buy-to-Let Radio Show

GMTV: Buy-to-Let Show

"...may be ready to jump at a months notice". Wouldn't really call it impartial advice ?!!!!

Posted by doomwatch @ 01:55 PM 4 Comments

What happens when the jobs dry up?

Telegraph: Over 2m foreigners are now working in Britain

Official figures from the Labour Force Survey show that the number of foreigners in the UK workforce increased between 2001 and last year by 864,000 - to just over two million people. This is equivalent to one in 14 of a total working population. By contrast the number of UK-born nationals in the workforce fell, between 2001 and 2007, down by 500,000 from 24.4 million in 2001 to 23.9 million last year. This could be a serious downward pressure on prices when the recession really starts to bite and most of them head off home.

Posted by uncle chris @ 01:43 PM 15 Comments

The collective delusion that house prices only go up

FT video interview: Peter Bernstein

Venerable historian Peter Bernstein speaks on the causes of the subprime. We went through a period of low risk. When risk is low so are returns. So people started taking more risks. This effects the whole financial system. The ratings agencies were part of this delusion that there was low risk. The delusion was based on the assumption that house prices don't fall. Video in three parts the third ends with a comment on gold (apologies if we are not allowed to mention gold on this blog anymore!).

Posted by happyrenterz @ 01:13 PM 4 Comments

Bird & Fortune cut straight to the heart of subprime

YouTube: Bird & Fortune - The Sub-Prime Market explained

This is a frightening insightful and hilariously funny satire. Bird & Fortune cut straight to the heart of the subprime market and the dodgy decision making of the banks and tell it how it is. Wonderful!

Posted by denzil @ 12:57 PM 4 Comments

"I have a dream..."

Times: Inflation rise puts rate cut hopes in jeopardy

David Smith is fast at work... curious to see how he will be able to turn a basket case into a plea for another rate cut "Halifax, the country's largest mortgage lender, has pencilled in at least another quarter-point cut in interest rates this year. Martin Ellis, its chief economist, said that further rate cuts depended, however, on whether the Bank believed that it could keep inflation under control." MAU AH HAHAHH AHHAHAH pencil pencil

Posted by confused76 @ 12:35 PM 27 Comments

"Make" 1.04 out of tenented DSS in Liverpool.

thepropertygrower.com: Buy to Let

Speechless on this one folks.

Posted by doomwatch @ 12:11 PM 19 Comments

More of what we already know

BBC News: Property market continues to cool

The UK property market is still cooling despite a slight rise in prices in December, government figures reveal.

Posted by garyb @ 11:39 AM 0 Comments

Repossessions could double this year

MoneyWeek: Why house repossessions could double this year

Repossessions jumped by 20% to 27,100 last year. And worryingly, those numbers don't include the knock-on effects of the credit crunch - expect this year's to be much worse.

Posted by mary @ 10:50 AM 8 Comments

The latest VI data from Connells Survey & Valuation.

MortgageSolutions: Mortgage approvals rise in January

Mortgage approvals for house purchase rose in January from their December low, according to the latest data from Connells Survey & Valuation. The change represents the first increase in mortgage approvals since May 2007. Approvals increased by 3% in January to 75,300 from 73,000 in December. Connells has seen a rise in housing stock coming onto the market and renewed interest from househunters.

Posted by jack c @ 10:42 AM 12 Comments

HSBC in need of Cash ????

telegraph: HSBC seeks to shed French retail division

officially its to dispose of a non-strategic asset.... but wouldnt it rather HSBC trying to raise cash ??? it looks as a strange move to sell a profitable retail banking in this environment

Posted by fagui @ 10:21 AM 0 Comments

Rate cuts and increasing inflation......

BBC: Producer prices at 16 year high

Do BoE know what they are doing? I think not. ''Price inflation of goods leaving UK factories has reached its highest rate in 16 years, driven higher by petrol and food costs, official figures show. Annual output price inflation reached 5.7% in January, up from 5.0% the previous month, according to the Office for National Statistics (ONS).''

Posted by hpwatcher @ 09:57 AM 5 Comments

Significant chance that CPI will rise above 3pc, forcing the Governor to write a letter of explanation to the Chancellor

Telegraph: Bank of England likely to miss inflation target

The Bank of England will use this week's closely-watched Inflation Report to warn of a high probability that it could miss its inflation target in the coming months. The Bank, which last week cut interest rates by a quarter percentage point to 5.25pc, is expected to raise its near term projection for the Consumer Price Index, implying a significant chance that it will rise above 3pc, forcing the Governor to write a letter of explanation to the Chancellor.

Posted by jack c @ 09:46 AM 4 Comments

They're still chucking money at people

ThisIsMoney: Northern Rock row over 125% loans

Beleaguered Northern Rock faces growing criticism for continuing to offer mortgages worth more than the value of borrowers' homes. The bank, which kept afloat only because it is underwritten by the taxpayer, still markets its Together mortgage deal, where homebuyers can borrow up to 125% of a property's price. Borrowers signing up to such loans instantly fall into negative equity. A Rock spokesman said: 'The Together mortgage is a legitimate product that performs well and helps people on to the housing ladder.'

Posted by little professor @ 09:38 AM 12 Comments

New Zealand's bubble

Bloomberg: New Zealand House Prices Increase the Least in a Year

"New Zealand's house prices rose at the slowest pace in 12 months as record-high interest rates and rising living costs curbed demand for property". "In December, the interest rate on a two-year fixed mortgage was 9.38 percent, up from 8.18 percent a year earlier".

Posted by alan @ 09:26 AM 0 Comments

Britain might dwindle into an insolvent dwarf, the Northern Rock of nations

times: Darling: a menace to Britain

Global businesses look at the present Labour Government and think about moving away from London The City of London is the jewel in the crown of the British economy. In terms of other economic factors, Britain may only be a second-class power, in manufacturing, invisible trade or in research. As a European economic power, Britain ranks above Italy and about level with France. Yet in finance the City of London meets Tokyo or New York on level terms as a major player. The City of London earns the living of the United Kingdom. Without the City's earning power,

Posted by chris @ 03:01 AM 0 Comments

"We think this is where the next big problem is going to pop up,"

TELEGRAPH UK: Americans and Europeans have so far confessed to $130bn of the estimated $400bn to $500bn of wealth that has vanished into the sub-prime hole.

Japan is the next sub-prime flashpoint There is still $300bn of bad debt out there, and Japan could be hiding most of it. Ambrose Evans-Pritchard reports Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East. Somebody, somewhere, must be sitting on a vast nexus of undisclosed losses. We may find out soon enough whether the hold-outs are in Japan. The banks have to come clean under the country's strict new audit codes by the end of the tax year in March.

Posted by chris @ 02:54 AM 0 Comments

Anatole vs Alistar

Times: Alistair Darling's confidence seems misplaced

After last week's speech on economic prospects from Mr Darling, I can, however, make one modest proposal for a contribution to Britain's economic revival: less complacency from the Treasury and fewer ludicrous boasts from the Chancellor.

Posted by confused76 @ 12:45 AM 4 Comments

Sunday, February 10, 2008

Where have all the men gone?

The Times: Lifestyle Article

Mmmmmmmmmmmm.... I wonder how much of this is really that people can't afford to get hithced and have kids. Welcome to a lonely old age, Buy to Letters....

Posted by orwell @ 11:01 PM 1 Comments

Why lowering interest does not rescue the banks

Me myself: Banks offering even higher interest rates

Even after the BOE has reduced interest rates twice the best saving account return has been around 6.9%. And has not reduced even after .50 point cut in interest rates. The reason is simple: The problem that these banks have is that they have a lot of loans on their books which is of poor quality and is getting poorer as time goes on. Hence they need money to put up for the losses. ECB gave $502 BILLION dollars in liquidity (2 week loans) in Dec-Jan. This was taken up by not only european banks but also American banks via subsidary/partner banks. And now its time to pay back. The chances of ECB giving the same money back again is next to impossible. So the sage continues and the banks need money even at higher rates from us as they will not lend to each other.

Posted by deepak @ 10:22 PM 3 Comments

Bank reporting timetable

Independent: Britain's battered banks pray for deliverance

Bradford & Bingley kicks off the banks reporting season this week; seven of the UK's biggest lending institutions will deliver full-year numbers by 3 March.

Posted by alan @ 08:48 PM 0 Comments

Possibility that governments might eventually need to inject capital into banks

FT: Subprime losses could rise to $400bn

Senior global policymakers have raised projections for the size of subprime-related credit losses in a move that implies financial institutions will have to increase write-offs.Speaking after the meeting of Group of Seven finance leaders, Peer Steinbrck, German finance minister, said the G7 now feared that write-offs of losses on securities linked to US subprime mortgages could reach $400bn. This is sharply higher than the $120bn credit losses that Wall Street banks and other institutions have revealed in recent weeks and also far bigger than the US Federal Reserves estimates for subprime losses last year of $100bn-$150bn.

Posted by jack c @ 08:30 PM 5 Comments

When the sunday papers predict a crash you know it is going to happen

Guardian/Observer: Atlantic drift: will UK housing market follow America into a slump?

We all know there are no fundamentals underpinning UK house prices, just psychology and greed."growing evidence that UK housing market is already slowing sharply. Prices have slipped for 3 consecutive months and repossessions were already at a 14-year high in 2007. In the US, early in 2007, analysts were puzzled that the fallout from sliding prices did not appear to be hitting consumer spending or jobs, and Ben Bernanke remarked in the spring that he thought the problem was 'largely contained'. Less than 6 months later mortgage defaults sparked a financial crisis; by the end of the year, joblessness was rising. In other words, a housing market downturn can itself sow the seeds of a broader economic downturn - especially if it has been pepped up by an outbreak of profligate lending"

Posted by confused76 @ 07:26 PM 6 Comments

Countryside becoming a care home for the elderly

Telegraph: Countryside abandoned as schools close daily

Schools are being shut at the rate of almost one a day, with hundreds axed in rural areas in the past five years. The full extent of the closures is revealed for the first time in new government figures which show that a total of 1,704 schools have been shut in England since 2002 - an average of 6.6 a week. *** So much for the governments commitment to keeping village schools open - another labour lie.

Posted by uncle chris @ 05:53 PM 6 Comments

Perhaps it is my dark sense of humour, but Muhuhahahahaha!

Rense.com: Can't Pay Your Mortgage? Trash Your House And Leave

"We just estimated a trashout yesterday where we're going to have to drain the pool," one Fontana , CA resident posted on AgentsOnline.Net, a resource and idea site for realtors, "and the stench from it when you enter the backyard is overwhelming. Then, of course there are mosquitoes all over the top and it's been sitting so long without chemicals that it's green on top and murky black on the bottom. We've already had to refuse one pool because of its really creepy condition and I'm not so sure about this one either. [I] just hope we don't find the previous homeowner at the bottom when we drain it."

Posted by lvmreader @ 05:52 PM 6 Comments

Good editorial in FT

FT.com: UK on a tightrope

Mr Darling should resist the alternative: a UK equivalent to Fannie Mae of the US to buy up and guarantee mortgages. A simultaneous bailout of bankers and overstretched homeowners may be tempting. But if house prices are too high and they almost certainly are subsidising them will only delay, not prevent, their ultimate decline. Gentle house price falls, and a slowdown without recession, would be an excellent outcome.

Posted by tick tock @ 02:52 PM 5 Comments

The 20 best places to buy a property in Britain

Times: The 20 best places to buy a property in Britain

Want to protect yourself against the market slowdown? Our correspondent names the 20 most fail-safe investment towns in Britain

Posted by david20040_0 @ 01:54 PM 34 Comments

Mortgage broker discusses repossessions

BBC News: Ray Boulger on repossessed homes

This mortgage broker talks about the credit crunch and interestingly flags up the growth of the sale and leaseback market. A good general article.

Posted by ian - bedford @ 11:59 AM 5 Comments

Govt ready to bankrupt N Rock?

Observer: Now you see the debt, now you don't - but you'll feel it

"The government denies there will be any impact on tax or spending because the distress is temporary and the Rock's liabilities are secured against people's mortgages. Don't be so sure"

Posted by letthemfall @ 11:01 AM 4 Comments

House prices are in freefall, but the economy is not. Quick! - cut rates more.

BBC "News": Healthy growth in service sector

The BBC will have been instructed by the ONS to portray it as a surprise.

Posted by paul @ 10:38 AM 3 Comments

Why the credit crunch is set to get worse

MoneyWeek: Why the credit crunch is set to get worse

It's been another miserable week for markets, from scary economic data to sharp falls for the major indices. And with banks set to tighten lending further, the outlook remains dark.

Posted by sha @ 10:34 AM 0 Comments

Mr Rt Hon Pig, Mr Trough.....Mr Trough, Mr Rt Hon Pig

Daily Mail: Revealed: 'MPs' buy-to-let scheme funded by the taxpayer'

The Commons authorities faced fresh calls for reform in MPs' expenses yesterday after a Mail on Sunday investigation showed how some use the system to build up valuable property portfolios. A loophole in the rules means they can benefit from what one privately described as an "MPs' buy-to-let scheme funded by the taxpayer".

Posted by ski @ 10:29 AM 4 Comments

what was that about sound fundamentals?

Times: Britain facing huge job losses

''TWO in every five employers plan redundancies over the next three months, according to an influential survey to be published tomorrow. It comes as two leading business groups warn of weak business confidence and a sharp slowdown in growth. Retailers had been very downbeat about prospects for January following a poor December, with like-for-like sales rising only 0.3%. This weeks figures will come as a relief, but the BRC is likely to warn that any strength is likely to be temporary. ''

Posted by hpwatcher @ 07:56 AM 10 Comments

Saturday, February 9, 2008

Interesting Speculation about Winners and Losers in A recession

Guardian: Who wants a recession

"First of all," says Peter Bolton King, chief executive of the National Association of Estate Agents, "I don't accept there is going to be a recession."

Posted by quiet guy @ 10:44 PM 5 Comments

If by 'good' you mean bloody awful

Bloomberg: Darling Says British Inflation Outlook Is 'Good'

U.K. Chancellor of the Exchequer Alistair Darling said he believes the Bank of England and the government can 'keep inflation down,' giving Prime Minister Gordon Brown 'room to maneuver' on spurring the economy. The BoE reduced the key rate to 5.25%, the second reduction in three months. Darling today reiterated that Britain remains in a 'strong position,' and able to weather the economic downturn. He said unemployment and government debt levels are 'historically low.' The Labour government has run up deficits totalling 169.4B since 2003, erasing three years of surpluses after it took office in 1997. The Institute for Fiscal Studies said Darling needs to raise taxes by 8billion to meet deficit targets, a move that would constrain rather than stimulate growth

Posted by little professor @ 08:07 PM 17 Comments

Fitch Ratings highlights the danger of the buy-to-let market

Mortgagestrategy: B2L in Fitch risk spotlight at RMBS conference

Fitch research reveals high regional concentration of buy-to-let loans which it says leaves such areas vulnerable if a recession occurs and results in mass selling. For example, London and the South East account for nearly 35% of all buy-to-let properties in the UK. If a sell off were to take place the value of properties in the region could plummet exacerbating existing house price issues and further affecting confidence and market deterioration.

Posted by jack c @ 04:34 PM 6 Comments

Refinancing: Please one more fix!

CNNMoney.com - Yahoo finance: Refis: Who can do it

The good news: mortgage rates are down. The bad news: it's much harder to qualify for a refinanced loan these days. "I'm turning away about 60% to 75% of the clients who come to me for a refi," said Bob Moulton, president of Americana Mortgage Group on Long Island, N.Y. "Some don't have enough equity and others have bad credit scores."

Posted by stevie dee @ 12:12 PM 0 Comments

United We Stand - Oh well, I believe the weather was nice in Tokyo this weekend.

AP - Yahoo: G-7 Brush Off Single Remedy for Industrialized Nations' Economic Woes

The G-7 had faced calls for increased coordinated action to deal with the U.S. housing problems in subprime mortgage loans, financial market turmoil, high oil and commodity prices, and heightened inflation expectations. Japanese Finance Minister Fukushiro Nukaga, who played host to the gathering at a Tokyo hall, said the economic conditions in each nation were so different that a uniform remedy was not feasible. "It is important that each nation take measures that are appropriate for that nation," he told reporters after the meeting.

Posted by stevie dee @ 11:16 AM 0 Comments

Up And Down Go The Prices!

Property Snake: House Advert

Are there any statisticians that can explain why the Estate Agents are doing this? Is it to do with showing more rosey figures than are actually the case? Or more offers?

Posted by orwell @ 11:01 AM 1 Comments

A VI must have stolen my blog ID!!

HPC.com: Look at comment 5

I can't believe it... they are watching us!! Look at comment 5, that is not my comment. This must have been by an unemployed EA spending his/her day surfing the web. They are afraid of us. and imitation is strongest flattery MWAUU UUAU AUHHA HAH HAHAH HAHHAHAHH. For the record I sold my 4BDR flat ("condo") in NYC in 2003 -- and bought euros with the proceeds.

Posted by confused76 @ 10:37 AM 41 Comments

London helps Wales to prosper.

icWales: Hat-trick of good news hints Valleys on the up

The Institute of Welsh Affairs unveiled research showing that fewer people are moving out of the Valleys. In fact, the low house prices are attracting individuals and families priced out of the capital a trend which can only continue as rail and road links improve. As Wales is funded from Westminster according to population instead of being based on need, this could have a noticeable affect on Wales' prosperity and house prices.

Posted by su @ 09:26 AM 9 Comments

The next bubble to burst

Market Oracle: US Treasury Bond Market - The Mother of all Bubbles

"Just like dot coms or real estate, today's bond prices reflect a fantasy world. In this "Bizarro" reality, the dollar will remain strong, inflation will stay low, economic strength will persist uninterrupted, and Fed policy will be predominantly hawkish for the foreseeable future. But when the fog finally lifts, and investors come to grips with a sagging dollar, recession, gaping budget and current account deficits, and the most accommodative Fed imaginable, bond prices will collapse, sending long-term interest rates skyrocketing higher"

Posted by sold 2 rent 1 @ 09:26 AM 5 Comments

MPC authority continues to wane

thisismoney.co.uk: Icelandic bank begins savings battle

The newest entrant to the UK savings market has decided to throw down the gauntlet to its rivals by keeping its savings rate static at 6.5%, despite the Bank of England rate reduction today. Its closest rival is Indian-owned ICICI bank's HiSAVE account at 6.41%. It is unclear whether ICICI, which held its position at the top of the tables for several months until Kaupthing's arrival, will be forced to retain its rate also.

Posted by uncle chris @ 09:06 AM 3 Comments

And all because UK PLC has run out of money

Independent: Darling rejects calls for spending spree to avert global recession

The Chancellor, Alistair Darling, risked a row with his opposite number from Washington yesterday by rejecting calls from the United States for a co-ordinated global boost to demand for the world economy. In fact, Mr Darling has little "headroom" for a spending splurge. As it is, the IFS expects the UK's fiscal deficit to exceed 40bn this year and for public sector net debt to hit 40 per cent of the national income next year, the Government limit. Mr Darling is supported by Germany and Japan, the latter citing the failure of huge public spending to revive its "post-bubble" economy in the 1990s.

Posted by uncle chris @ 09:01 AM 4 Comments

Long live the front garden - short die the car

Telegraph: Cost of paving front garden to rise

Homeowners could be made to seek planning permission to pave their front gardens. Ministers want to make it prohibitively expensive for households to lay asphalt and other impermeable materials. The process would introduce an extra cost of around 875. They are concerned that it raises the risk of flooding because it stops rainwater soaking into the ground. Estimating that the average cost of the process will be . Defra estimates that in the last decade, households in London have paved over ground equivalent to 22 Hyde Parks

Posted by uncle chris @ 08:55 AM 7 Comments

FT reports price falls and revises DOWN previous estimates

FT: House prices see second monthly fall

... but in Chelsea and Westminster prices went up 20% in the past three months... with the City labour market shrinking by 5-10% net (vs previous year expansion) then you are sure it is a bubble. It will be fun to watch the show here in london

Posted by confused76 @ 08:26 AM 3 Comments

Friday, February 8, 2008

Collectively Britons owe more than 1.3 trillion and millions are struggling with repayments

Times: Britain's debt by numbers

The number of people whose homes were repossessed last year rose by 21 per cent, but repossessions are just one indication of the UKs deepening debt crisis. The scale of individual debt, both through mortgages and other debts such as credit cards and personal loans, has increased sharply over the last ten years. By the end of December 2007, total lending to individuals reached 1,409 billion, figures from the Bank of England show. Of this 1,409 billion, 1,185 billion was mortgage lending with the remainder 224 billion consisting of consumer credit including credit cards. This compares to the 419 billion of secured debt and 84 billion unsecured in May 1997.

Posted by jack c @ 11:14 PM 4 Comments

Endemic mortgage fraud on new homes

FT: Mortgage fraud spirals out of control

Endemic mortgage fraud on new homes has triggered a wave of repossessions and forced a widespread crackdown by regulatory authorities.Initiatives to address lenders concerns that residential mortgage fraud is on the rise are either under way or will be launched by the Council of Mortgage Lenders, Financial Services Authority the City watchdog the Royal Institution of Chartered Surveyors and police forces around the country.

Posted by jack c @ 10:50 PM 10 Comments

Guitarist "Slash" suing his estate agent

Telegraph: Hollywood stars count cost of housing slump

Celebrities in Hollywood are losing millions of dollars as the housing slump in the US has forced them to cut the prices of their luxury homes. Forbes, the business magazine, has compiled a list of some of the stars hardest hit by the property downturn. Avril Lavigne, the Canadian singer, has just accepted an offer on her five-bedroom, six-bathroom home in the exclusive Hollywood Hills after cutting the price from $6.9 million (3.6 million) to $5.8 million.

Posted by lvmreader @ 08:19 PM 5 Comments

Inflation, inflation, inflation

Thomson Financial News: OUTLOOK Inflation the watchword for UK data in coming week

Inflation figures will be at the forefront of investors' minds in a fairly busy week for UK data.

Posted by ash4781 @ 07:56 PM 0 Comments

Big Warren sticks it to 'em

Reuters: Bank woes are "poetic justice" - Buffet

Buffett, one of the world's wealthiest people, appeared to see irony in the fact that many of the banks who marketed complex investments which have now crashed are bearing much of the fallout. "It's sort of a little poetic justice, in that the people that brewed this toxic Kool-Aid found themselves drinking a lot of it in the end," he said.

Posted by little professor @ 06:41 PM 0 Comments

A popular investment slips

Guardian: British Land writes off 1.4bn from value of commercial property

Britain's second-largest property developer was forced to cut 1.4bn from the value of its offices and out-of-town retail parks yesterday in response to the credit crunch and failing investor confidence. "We said in 2006 that the market was overpriced. We sold property and fixed our loans when rates were low," said the chief exec.

Posted by alan @ 06:11 PM 0 Comments

End of the boom? - Australian market.

The Age: End of the boom?

"It has to fall at least as far as the US market will, and probably a lot more. Some conservative pundits think US prices need to fall another 25 per cent to restore pre-bubble valuations, and theyve already fallen 8%. That means a 33% decline from a peak thats 30% lower than ours. Given that our economy is in slightly better shape than theirs, it still puts a minimum on the price decline needed of about 33%, and a maximum of 50% could apply if the China boom comes to an end."

Posted by killer_bob @ 04:35 PM 4 Comments

INFLATION becomming embedded - Rate cutters, that's your lot!

BBC: Pay rises stoke inflation fears

Negotiated pay awards in the last three months have risen sharply, prompting fears that inflation will rise. Average private sector pay deals in the last three months rose to 4% annually, up from 3.5% earlier in 2007, according to Incomes Data Services (IDS).

Posted by tyrellcorporation @ 03:34 PM 11 Comments

Vince Cable MP - "we could now be at the brink of another crash in the housing market"

Mortgagestrategy: Cable warning over CML figures

Vince Cable has warned that figres showing a rise in repossessions suggest we could be on the brink of another crash. Cable says: Last year saw the highest number of home repossessions this century, but of particular concern is the rise in the number of repossession orders, which indicates we could now be at the brink of another crash in the housing market.

Posted by jack c @ 03:32 PM 2 Comments

"Where will affordable housing go now? Not anywhere the rich want to live"

Camden New Journal: Our socialist dreams are fading

This lady was the oldest columnist in the world and a staunch socialist to boot. She earlier died this week, just short of her 102 birthday, this article is from December 07.

Posted by sid public @ 03:29 PM 5 Comments

Repossessions triple since 2004

Guardian Unlimited: Home repossessions leap by 21%

The number of properties repossessed by mortgage lenders leapt by 21% in 2007 to their highest figure since 1999, the Council of Mortgage Lenders (CML) said today. A total of 27,100 homes were repossessed over the year, up from 22,400 in 2006 and more than three times 2004's figure of 8,200.

Posted by chris k @ 03:29 PM 0 Comments

begging for more money in germany!!!

reuters: Subprime stricken IKB attempts third rescue

the German bank which nearly went bust after its subprime investments crashed, is searching for up to 2 billion euros to stay afloat, sources with direct knowledge of the situation told Reuters. It needs up to 2 billion euros ($2.9 billion) of fresh capital, without which the bank's existence is threatened, two of the sources told Reuters.

Posted by mark @ 03:00 PM 0 Comments

Getting a mortgage will get harder & dearer !

Bloomberg: Loan Losses May Spur Writedowns, Bank of America Says

"Banks sitting on $160 billion of unsold leveraged loans may have to write down more losses after a plunge in the value of the debt, according to Bank of America Corp. analysts". "Banks including Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley are unable to offload debt from last year's record $438 billion of buyouts"

Posted by alan @ 02:42 PM 0 Comments

Have you been 'gazundered' or considering 'gazundering'?

BBC: Hassled by housing?

The Truth About Property returns to BBC Two for the spring, and we would like to hear how your lives have been affected by the downturn in the property market.

Posted by doomwatch @ 02:03 PM 4 Comments

Neither a borrower or Council of Mortgage Lender be

Independent: Cut in interest rates offers little comfort to borrowers

"...the misery of millions of homeowners was predicted to continue..." Woe, woe and thrice woe. Another clear and illuminating comment from Vince Cable at the end of this article. Is there any other politician capable of his sensible obervations on all this?

Posted by letthemfall @ 01:58 PM 0 Comments

Good News For The Weekend!

MSN MONEY: Why the rate cut won't mean cheap mortgages

This is about as honets a view of the mortage / housing market I have read for a week!

Posted by waitingfor hpc @ 01:42 PM 5 Comments

Going sharia and house prices

Fool: Protect Your Money -- The Islamic Way

Reuters Reports everyone up in arms about Rowan Williamson for suggesting the introduction in Britain of some aspects of sharia law was unavoidable. Here is something I found on Sharia finance and mortgages. Of course, if you choose to buy a house using Islamic financial services, you won't have to pay any interest on a mortgage. "Sharia'a compliant home finance is based on the principles of ijara (leasing) and musharaka (partnership). Here's an example of how it works: Say the bank contributes 90% and the customer 10% of the purchase price. Over an agreed period (up to 25 years), the customer then pays monthly purchase instalments, through which the bank sells its share of the home to him or her... "

Posted by happyrenterz @ 01:30 PM 11 Comments

The bubble merry-go-round goes on

Safe Haven: Looking Beyond a Recession

This guy says that U.S. stocks can very well continue to rise even as housing prices continue to decline.

So we have a stocks bubble in 2000 that fed into a housing bubble in 2006-7. Where is the next bubble to be? commodities? stocks? China? All three?

Posted by sold 2 rent 1 @ 01:07 PM 2 Comments

The trend is your friend and it's pointing downwards

Firstrung: House prices in England and Wales rose by 0.1% in January continuing a three month run of growth rates around zero

London's rate of house price inflation is almost twice that of the next highest region (the South East) and is more than five times higher than the lowest region (the West Midlands). However, this month the annual rate of increase in London has continued to fall in common with all other regions. Eight of the regions, including London, also show a fall in the monthly growth rate over the previous month and seven, including London, have actually recorded negative growth - this ranges from -0.8% in East Anglia to -0.1% in London

Posted by converted lurker @ 12:52 PM 0 Comments

Get the Chicks!

Times: The Bricks Chicks analyse yesterday's interest rate cut

Rates fell in February by 0.25 per cent, but what does it all mean for homeowners? It means MWA UUHAH HAHAHHAHAHHAH

Posted by confused76 @ 12:44 PM 5 Comments

Special pleading from the lenders

The Times: Home repossessions hit eight-year high

Here's a goody from the CML: "The CML has also written to the Government to urge it to boost the state support for people who fall behind with their home loan payments. In the letter to Kitty Usher, Economic Secretary to the Treasury, Micheal Coogan, Director General of the CML, wrote: "The Government needs to play its part by improving state support arrangements." " Brilliant idea! Bail out the home buyers, thereby bailing out the lenders. That's my kind of economics. "Dear Mr Brown, I'm a bit short this month due to foolish borrowing. Please send cheque to ...."

Posted by letthemfall @ 12:10 PM 2 Comments

XL downgraded 6 notches from AAA

Reuters: MBIA raises $1Bn, XL Capital Assurance cut

Fracture in the bond insurance market. MBIA, the largest insurer manages to raise capital by issuing shares, while XL Capital Assurance has been downgraded as it's financial resources seem way to thin.

Posted by 51ck-6-51x @ 11:49 AM 0 Comments

Times is dissing us, yo!

TheRatandMouse: Times cracks to HousePriceCrashers... fight!

They [housepricecrash.co.uk] don't get a link, but it's pretty clear whom Anne Ashworth is talking about here: "This pro-crash lobby accuses the economists at Nationwide and Halifax of publishing figures that give a falsely optimistic view. Journalists who report these numbers are deemed to be either mouthpieces for lenders or determined to support the value of their own property investments. The motives of this online fraternity that longs for the human misery produced by a market collapse are a mystery. Perhaps they hope that if they spread sufficient gloom, their rantings will become a self-fulfilling prophecy? " You can't predict something, wait indefinitely for it to happen, and then claim a victory.

Posted by little professor @ 11:48 AM 47 Comments

Gordon Browns mis-management is hurting the pound

MoneyWeek: How Gordon Browns financial mis-management is hurting the pound

Yesterday the Bank of England said it wouldnt dramatically slash interest rates like the Fed. Even so, the pound tumbled against the dollar. John Stepek explains why sterling is in trouble.

Posted by mary @ 11:34 AM 0 Comments

Ray Boulger - top mortgages guru at Charcol wonders if there was some behind the scenes management

Ray Boulger's blog (Charcol): 9 of the top 10 lenders announce a 0.25% cut in their SVR

Ray Boulger can't remember the last time so many lenders announced their interest cuts all on the same day - he wonders if there's been some behind-the-scenes organisation.

Posted by tamsin bishton @ 10:58 AM 0 Comments

Get the domain name now while it's going

repossession.co.uk: n/a

www.repossession.co.uk is still up for grabs. It's a groing market.

Posted by doomwatch @ 10:54 AM 4 Comments

Rate cut to be pocketed by banks... not the poor BTLetters

Times: Lenders are criticised as cut in interest rate fails to curb mortgage levels

"Although many lenders announced that they would pass on the base-rate cut to borrowers, mortgage brokers said that recent increases in mortgage rates could wipe out potential savings" the old trick of bumping up prices before the sales UAHHH HAHAHHAHAH

Posted by confused76 @ 10:46 AM 0 Comments

15pc fall by August 2009

Market Oracle: UK House Prices on Target for 15% Fall Despite Interest Rate Cuts

The UK housing market price trend is on target towards a 15% fall in nominal terms by August 2009. This would equate to a real terms fall of more than 20% and could push the UK into recession during late 2

Posted by sold 2 rent 1 @ 10:45 AM 2 Comments

Euro M3 at 12pc

Market Oracle: ECB Smoke and Mirrors to Mask Explosive Money Supply Growth Fueling Inflation

Global traders must see thru the ECB's game of "Smoke and Mirrors" designed to fool most people, most of the time." Follow the money, and not the ECB's empty rhetoric and propaganda that fly across the newswires each day. And remember, gold knows what no one knows. "At some point, you have to choose between trusting the natural stability of Gold, and the honesty and intelligence of members of the government. With due respect for these gentlemen, I advise you, as long as the capitalist system lasts, to vote for Gold," said George Bernard Shaw in 1928.

Posted by sold 2 rent 1 @ 10:35 AM 2 Comments

Peak food

The Telegraph: Why the price of 'peak oil' is famine

Vulnerable regions of the world face the risk of famine over the next three years as rising energy costs spill over into a food crunch, according to US investment bank Goldman Sachs.

Posted by sold 2 rent 1 @ 10:16 AM 4 Comments

ECB to cut rates in April

The Telegraph: ECB may follow Fed and BoE in rate cut

"It bothers a lot of ECB council members that they have never met their 2pc inflation target in eight years. Is there any other profession where you can miss your target for eight years and still be credible? They're going to keep rates on hold. If they cut, I'm going to be buying inflation protection," he said.

Posted by sold 2 rent 1 @ 10:14 AM 1 Comments

Oh god, more reports......

FT: House price weakness spreads to London

UK house prices are now lower than they were three months ago and the weakness shows signs of spreading to London which has appeared resilient up until now, according to the latest FT House Price Index. On a monthly basis, house prices in England and Wales rose by 0.1 per cent, according to Acadametrics, the research firm which compiles the index. But previously reported rises in November and December have been revised downward, leaving the average house price at 229,625 against 230,284 in October.

Posted by hpwatcher @ 10:03 AM 4 Comments

Like the 90's all over again.......

BBC: Home repossessions rise to 27,000

The number of people whose homes were repossessed last year has risen by 21%. The Council of Mortgage Lenders said 27,100 homes, the highest figure since 1999, were taken over by lenders after people fell behind with repayments.

Posted by hpwatcher @ 09:52 AM 4 Comments

London's 3bn housebuilding programme.

Moneymarketing: London housebuilding partnership scheme unveiled

Housing Minister Caroline Flint and London Mayor Ken Livingstone have joined forces to create a new partnership to speed up the delivery of London's 3bn housebuilding programme. The Homes and Communities Agency, the Mayor and the Government are joining forces to establish the London HCA Board, a local sub-committee of the HCA responsible for helping to deliver affordable housing in London and the South East. London Boroughs will be represented at this sub-committee.

Posted by jack c @ 09:13 AM 4 Comments

First time buyers have been encouraged by falling interest rates and are re-entering the property market.

Mortgage Solutions: First-time buyers rise as interest rates fall

A monthly survey by Spicerhaart Financial Services (SFS) has revealed that first time buyers have been encouraged by falling interest rates and are re-entering the property market. The survey shows that following a drop in first time buyers after the credit crunch, numbers rose by 2% in January and third of all purchasers were first time buyers. The survey also reveals that the number of consumers taking out loan to value mortgages of more than 95% dropped to 17%, compared to accounting for almost a quarter of mortgages in August.

Posted by jack c @ 09:09 AM 26 Comments

No light at the end of the tunnel

The Times: Tentacles of sub-prime crisis tighten on UK firms

Not my line, but that of the article. There seems to be a race between the effects of the credit crunch and central banks who are cutting interest rates. People think that the credit crunch is going to win and that interest rates are not going to come down quickly enough. People are nervous and it is going to stay like this. Trouble ahead, and a certain HPC

Posted by growler @ 07:51 AM 0 Comments

The media think were being vitriolic and want us to go away

Times Online: All property statistics are lies - or that's what some people would have you believe

This pro-crash lobby accuses the economists at Nationwide and Halifax of publishing figures that give a falsely optimistic view. Journalists who report these numbers are deemed to be either mouthpieces for lenders or determined to support the value of their own property investments.

Posted by landedgentry @ 07:49 AM 14 Comments

Last Chance Saloon

Telegraph: Bond market fears as UK debt soars

"The UK household sector is borrowing at a cyclically unprecedented 4pc of GDP. Allowing economic growth to be based on unsustainable asset price bubbles was always going to be a recipe for disaster because the snapback can be vicious. This is a mess of the policy-makers' own making." Interesting article about National Debt - and a scary looking Balance of Payments chart that as good as mirrors the housing market boom and bust.

Posted by growler @ 07:44 AM 13 Comments

Sales volume crashes 40%, 7.5% price fall in ONE MONTH.....

Interest.co.nz: Auckland sales volumes crash 40%

There that got you going - but this is the biggest market in New Zealand, the Auckland market in free-fall. Note the common factors with UK - massively distorted house prices and VIs still trying to deny the inevitable. Where Auckland goes the rest will follow; national prices were down 4.4% October to December according to QV survey, this latest survey hints at 5-6% fall nationally IN JUST 4 months!!!

Posted by andy hamilton @ 03:43 AM 2 Comments

Gold and Silver BIG Picture

financialsense: Opening the Mint to Gold and Silver

The Mint is the symbol of Constitutional Money, the only kind not subject to manipulation. In the 1800's governments illegal powergrab's took over money creation from the Mint. Today as a result of this, money printing is becoming ever more frantic. One debt bubble after another is made. The latest being our beloved house price bubble. As currencies become worthless a Gold War is going on in the world. The alignment of the antagonists is the same as it was in the Cold War. The name of the game is: who will end up with the largest pile of the precious yellow metal? To attract gold and silver, Mints will be reopened, the last one to open loses, since other countries will already have hoovered up any gold and silver to stabilise their crumbling financial systems.

Posted by happyrenterz @ 12:34 AM 3 Comments

Thursday, February 7, 2008

More chance of finding Elvis on the moon???

Firstrung: Elvis isn't dead 'cos we heard him on the internet

There was an extraordinary event played out in the auction rooms at the Cafe Royale Regent Street London today, it was possibly the first concrete evidence that the inevitable major house price correction is now amongst us. In fact let's not be coy it was a crash ...scratch that, crash doesn't go far enough in describing this property freak show, it was an implosion of biblical proportions...

Posted by converted lurker @ 11:46 PM 18 Comments

Senate Approves Economic Aid Plan With Rebates for Older People, Disabled Veterans

Yahoo - AP: Senate Passes Stimulus Plan

Echoes of 1929 - The Senate passed an economic rescue plan Thursday that would speed $600 to $1,200 in rebates to most taxpayers and $300 checks to low-income people, including disabled veterans and the elderly.

Posted by stevie dee @ 10:50 PM 0 Comments

Bending it Like Bernanke

Bloomberg: Bending it Like Bernanke Shows Error of Fed Ways

Being Ben: Could You Avoid a Depression?

Posted by fofp @ 05:50 PM 2 Comments

Even at auction nowts selling

eigroup: Essential Auction News

Quickly glimpsing over and comparing the regional residential auction figures it would appear that in all cases Lots Offered is UP, yet percent sold is DOWN for 07 versus 06. Oh dear.

Posted by doomwatch @ 03:30 PM 9 Comments

Over half of the UKs super-rich non-domiciles plan to leave the country or sell their investments in the wake of new tax rules

International Investment: Massive hit forecast from non-dom exodus

As well as falling tax revenues and the sale of UK investments, a non-dom exodus would also be a huge hit to consumer spending, as wealthy inpatriates spend 16.6bn in the UK each year - equal to the GDP of Luxembourg. On top of this it is estimated they also have UK business interests of about 125bn. Commenting on the figures, David Harvey, CEO of Step, said: The super rich already pay 54 times more tax than the average. We want rich people in the economy, paying tax, and creating jobs but government plans will have the opposite effect.

Posted by jack c @ 03:28 PM 18 Comments

Will Charlotte change her tune over the next few months ...

The Whingeing Wealthy: The new class: The Whingeing Wealthy

The Evening Standard's Charlotte Ross has a houshold income of 88,000 and a 'dodgy' 30-year mortgage at four-and-a-half times her salary. She knew the 'reckoning was around the corner'...

Posted by doomwatch @ 03:16 PM 3 Comments

European Central Bank seeks to bring surging inflation back within its target range

FT: Eurozone interest rates left unchanged

Eurozone interest rates have been left unchanged by the European Central Bank as it seeks to bring surging inflation back within its target range.The decision to leave its main policy rate at 4 per cent was widely-expected after eurozone inflation last month hit a 14-year high of 3.2 per cent. The ECBs concerns that a temporary rise in price pressures could become longer-lasting are thought to have outweighed fears about growth. The ECBs stance has contrasted sharply with the aggressive interest rate cuts announced by the US Federal Reserve.

Posted by jack c @ 02:52 PM 1 Comments

watching a crash happening in real time

FT Alphaville: The British property crash - Live!

FT watching this HPC blog site again.. "Couldnt do this the last time house prizes went into a sharp downward spiral, about seventeen years ago. But now you can watch it from your desktop, over a lunchtime sandwich. Go to Barnard Marcus online auction here. Enter your name and email address (simple as that, no registration) to see what sells and for how much - if they sell at all, that is. On Thursday, dozens of properties either remained unsold or changed hands at a substantial discount to the last recorded sale price. As of 2pm, London time, the auction was about half way through some 260 lots."

Posted by happyrenterz @ 02:16 PM 13 Comments

Inflation above target but they still cut rates !

BBC: Bank cuts interest rates to 5.25%

The Bank of England's rate-setting committee has cut interest rates to 5.25% from 5.5% in an attempt to stimulate growth in the UK economy. This follows recent rate cuts by the US Federal Reserve, which sliced rates from 4.25% to 3.0% amid fears of the widening impact of the credit crunch.

Posted by jack c @ 12:12 PM 66 Comments

Dubai is a bubble waiting to burst, but Hong Kong looks good

MoneyWeek: Move over Dubai - Hong Kong property is better value

When property developers start handing out free Bentleys with sales, it's a sure sign that a bubble is about to pop. Sweeteners aside, ignore over-rated Dubai and head for Hong Kong instead.

Posted by mary @ 11:36 AM 2 Comments

The ONS thinks NRs been nationalised

FT: UK puts Rock on government books

Northern Rock was officially classed a public sector company on Thursday morning, bringing its debts onto the governments books and blowing apart one of the Treasurys cherished budgetary rules. The Office for National Statistics announced that the government has had so much control over the stricken mortgage lender since October that it should be classified in just the same way as nationalised entities such as Royal Mail.

Posted by uncle chris @ 11:02 AM 8 Comments

Inflation? What Inflation?

MoneyWeek: The Bank of England's Real Inflation Target

Rising inflation in the cost of living didn't prevent the Bank of England from cutting interest rates in 2001, 2003 or 2005. Why should the Old Lady break the habit of her (independent) lifetime now?

Posted by dave the box @ 11:00 AM 1 Comments

Can we have 25-yr fixed rate savings too?

thisismoney.co.uk: 25-year fixed home loans to be the norm

Mortgages that are fixed for a quarter of a century will become commonplace under a radical shake-up of the home loan market, Alistair Darling said last night. He will reveal plans in his first Budget next month to encourage lenders to offer fixed-rate mortgages lasting up to 25 years at reasonable rates.

Posted by uncle chris @ 10:58 AM 15 Comments

Rate cut won't help the housing market

The Market Oracle: UK Interest Rates Cut to 5.25% - Will Not Help the Housing Market

UK Interest rate cuts won't be of much help to home owners, due to the impact of the wealth effect going into reverse as house prices continue their month on month declines. For example on an average mortgage of 100k, a 0.25% cut in interest rates would result in a cut in monthly repayments of just 21. Whereas a decline in house prices of 0.5% per month results in a monthly loss of equity of 950 on an average 190,000 property. Therefore many market commentators and economists expecting a series of rate cuts to turn the UK housing market around may be surprised that the rate cuts will have very little impact on the weakening housing market, which is forecast to fall by 15% over 2 years as of August 2007.

Posted by talon @ 10:57 AM 1 Comments

Why break yourself to pay for something you don't own anyway?

CNN Money: Troubled borrowers are walking away from their homes

Fascinating article from CNN about how - and why - many Americans are simply walking away from their mortgage in a rapidly declining market: "Many buyers put little or no money down, so they don't have much invested in them. That leaves them with little incentive to keep making payments when a home's market value dips below the balance of the mortgage." But we don't have 100% interest-only mortgages over here, do we?

Posted by nastynick @ 09:50 AM 4 Comments

Repossession, Repossession, Repossession

citywire: Your views: did you see Jeff Randalls debt special on ITV?

If you didn't see the show this blog post gives a better description than I have seen in the newspapers. Still making up my mind myself, it was quite hard-hitting and dramatic. "It pulled out all the visual stops from the bacchanalian party scenes to the repo mans cane rapping on the front door and used them to great effect." "But the best part of such documentaries is the way people condemn themselves out of their own mouths. The spokesmen for the lending banks remained remarkably insouciant. 'Were very prudent; we just respond to demand; why would we lend to no hopers?' Because you make money from lending ever bigger volumes, stoopid."

Posted by happyrenterz @ 09:28 AM 42 Comments

Low unemployment? Looks like the figures have been disguised...

Daily Mail: Britain's benefits generation: State handouts now a 'way of life for six million'

''Six million Britons are living in homes where no one has a job and "benefits are a way of life", a report by MPs revealed yesterday. And they cost the taxpayer nearly 13billion a year in state handouts. ''

Posted by hpwatcher @ 09:08 AM 8 Comments

Help!

Daily Express: Millions of us praying for another rate cut

MILLIONS of families were praying for a cut in interest rates today amid growing concern about turmoil in the property market. Money experts predict a 0.25% reduction but are calling for a larger cut 0.5% to help bring millions of home owners back from the brink of financial meltdown.

Posted by little professor @ 08:12 AM 20 Comments

What Happend to the Cheap Money?

Telegraph: 'Greedy' banks push up mortgage rates

"financial experts warned that even if rates continued to fall this year, the majority of the 11.8 million mortgage holders in Britain were unlikely to see much benefit."

Posted by quiet guy @ 02:49 AM 11 Comments

Money is still cheap, but get out of the dollar

Bloomberg: Buffet sees no credit crunch, continued decline of dollar

Billionaire Warren Buffett, chairman of Berkshire Hathaway Inc., said a credit crunch isn't under way and he forecast that the dollar's value is likely to decline. "Money is available and it's really quite cheap,'' he said. Buffett's company has the highest possible AAA credit rating and has more than $40 billion in cash available. The only currency Berkshire directly owns now is the Brazilian real, Buffett said. He blamed the declining dollar on the current account deficit.

Posted by little professor @ 12:05 AM 2 Comments

Wednesday, February 6, 2008

Crisis!!!What Crisis?????Pass the bucket of sand.

Bloomberg: Darling Says Britain's Housing Market More Resilient Than U.S.

``Housing market conditions today are very different to those we saw in the early 1990s,'' Darling said. ``Interest rates remain at comparatively low levels, as do mortgage rates. And unemployment is currently at 30-year lows.'' - No mention of Inflation?????....interesting, very interesting.

Posted by bystander @ 11:35 PM 11 Comments

1/2 point cut? you wish!!

Times: Emergency: intensive care needed

"The British economy is in big trouble" and where are Halif*ck's strong fundamentals? "Britain, contrary to widespread belief, is at greater risk than America from the global financial crisis." OOOOOO.... "Even if the US averts recession, Britain faces a difficult period - in all likelihood at least as bad as America's slowdown and housing slump of the past 18 months" UUUUUUU... strong... fundamentals..."British growth in the past 15 years has depended almost entirely on three sectors - finance, housing and the public sector. Between them, they employ about one third of the workforce but have accounted for 120 per cent of employment growth" EEEEEE?... 120percent?? I aint sure what Anatole is on, but I want some!

Posted by confused76 @ 11:16 PM 9 Comments

Another financial Black Hole courtesy of New Labour

Times: 2bn of public money goes down the Tube as Gordon Brown counts cost of failed deal

Some more of our money going down the toilet, just how much more can the government pour down the drain before everything goes south.

Posted by enuii @ 10:48 PM 3 Comments

Decline of the $

cnbc: 'Euros Accepted' Signs Popping Up in New York City

In the latest example that the U.S. dollar just ain't what it used to be, some shops in New York City have begun accepting euros and other foreign currency as payment for merchandise.

Posted by alan @ 10:16 PM 1 Comments

It's Payback Time

Telegraph: 10m 'may default on debt by end of year'

Mr Randall, who as part of the programme met people who had been driven to the point of suicide by their debts, said: "What we believed was widespread economic prosperity turns out for many to have been an illusion, funded by excessive debt."

Posted by quiet guy @ 07:03 PM 14 Comments

Sell your holiday house before april the 6th if you have had it a while!

This Is Money: CGT change may hit second homeowners

As basic rate taxpayers they will have to pay tax at 20% making their bill 4,000. Under the new regime, they will be taxed on 76,100 after using their personal exemptions, making their bill a whopping 13,698 - more than three times as much...... The people that bought a second home before 1998 should sell now before you get stitched up! And the sheeple that bought after will probably flood the market for their 18% tax break (on what's left of their profit by then!!!)

Posted by holding off @ 05:45 PM 2 Comments

Why scary newspaper headlines are a good thing

MoneyWeek: Why scary newspaper headlines are a good thing

The weekend newspaper sections are terrified: once they were running stories urging readers to get a 125% mortgage, now they're explaining how to keep a roof over your head. Better late than never.

Posted by mary @ 05:43 PM 5 Comments

MPs to probe energy prices and regulation

Charcol home & money news: MPs to probe energy prices and regulation

A committee of MPs is to examine the energy market in the UK, as criticism of recent price rises grows. The all-party Business, Enterprise and Regulatory Reform (BERR) committee will investigate possible anti-competitive behaviour in the market, and whether its current structure encourages effective competition.

Posted by tamsin bishton @ 05:36 PM 1 Comments

Not content with flogging consolidation loans from vulture loan companies

Telegraph: Would you buy a villa from Carol Vorderman?

Carol Vorderman has peddled more products over the years than almost any other celebrity. So it was probably inevitable that she would eventually turn her hand to property - which she does this month by launching Carol Vorderman Overseas Homes. The company is selling five overseas developments, in Orlando,Florida, the Bahamas and Spain's Costa Blanca. Vorderman has been criticised for representing FirstPlus for over ten years. The loans company is under investigation for lending people more than the equity of their homes, leading to negative equity and repossessions.

Posted by little professor @ 05:25 PM 8 Comments

has bush wrecked the world economy?

msn: has bush wrecked the world economy

I guess only time will tell? however to blame one man for all our woes is surely wrong,,or perhaps not. when your the president of the u.s.a. you have to bite the bullet sometime. plenty have done so far at his bequest, perhaps he was just the right man to bring on the inevitable sooner rather than later?

Posted by camping @ 03:51 PM 0 Comments

Amazingly, I thought this referred to the USA initially...

Telegraph Online: 10m 'may default on debt by end of year'

More than 10 million people may default on repayments for mortgages, credit cards or personal loans by the end of the year.

Posted by in the delhi @ 03:26 PM 1 Comments

How do we rate this "expert"?

Bloomberg: U.K. Housing Market Slump `Won't Be Very Big,' Nickell Says

The U.K. housing market slump won't last long, and interest rates are unlikely to decline quickly, former Bank of England policy maker Stephen Nickell said.... ``The actual size of the downturn is minute,'' Nickell, who now advises the government on the residential property market, said in an interview in London yesterday. ``How big is it going to be? I don't know, but it won't be very big.'' He is now a professor at Oxford University and chairman of the National Housing and Planning Advice Unit, a group set up to counsel government ministers on how to protect the interests of people priced out of the property market.

Posted by alan @ 02:06 PM 55 Comments

Credit rating agencies' role in the credit crisis

MoneyWeek: The great credit rating scandal

One group has been especially culpable when it comes to the current market mess: the credit rating agencies. How was the ratings system abused? And what does this debacle mean for all of us?

Posted by mary @ 12:41 PM 4 Comments

Setting the scene for the Great High Street Cull

FT: UK consumer confidence hits low

Consumer confidence, as measured by a popular survey conducted by Nationwide, fell to its lowest level in January since May 2004 when it was first conducted. The number of people confident about the outlook for jobs fell to 36 per cent of those surveyed from 44 per cent last month, despite official data showing UK employment at record levels. Moreover, there is growing gloom over prospects for house prices, with a general expectation of a 0.2 percentage point drop in house values over the coming six months against an expectation of a 0.7 percentage point rise in December.

Posted by uncle chris @ 12:14 PM 1 Comments

Banking - not the best place to be in 2008!!

gUARDIAN: Virgin backtracks on Northern Rock redundancies pledge

Sir Richard Branson's Virgin has gone back on its pledge not to cut jobs at Northern Rock if it succeeds in its bid for the stricken lender, alarming unions who have vowed to fight compulsory redundancies

Posted by inbreda @ 12:02 PM 8 Comments

11 million likely to find it increasingly difficult to meet repayments in 2008

Firstrung: One in four home owners struggling to meet mortgage payments - KPMG

One in four home owners struggling to meet mortgage payments - Reducing credit limits and the end of cheap fixed mortgage deals likely to push many over the edge. Almost one in four (22 per cent) people with mortgages and other debts find it difficult to meet repayments according to a new survey commissioned by professional services firm, KPMG. This is the equivalent to nearly seven million people in the UK struggling to cope with their existing debt. The outlook for the next 12 months does not offer any respite. When polled by YouGov 35 per cent of those living with debt - equivalent to 11 million people - admitted that they are likely to find it increasingly difficult to meet repayments in the coming year.

Posted by converted lurker @ 11:54 AM 8 Comments

BP axe 5000

Guardian: BP to axe jobs after profits plunge

I would imagine the London market will be hit with all those middle managers with no skills on the dole.

Posted by doomwatch @ 11:37 AM 5 Comments

Oh dear oh dear oh dear

Guardian: The Costa dream that turned sour

Now that construction sites are closing, an estimated 500,000 construction workers will be laid off and are likely to struggle to find employment. Others bought their Spanish houses in the UK, without ever setting foot in Spain. Stories are told of people who paid for what they thought were the deeds to a four-bedroom villa with a pool, only to discover later that they had paid for a wall or a warehouse.

Posted by inbreda @ 11:33 AM 6 Comments

Caroline Flint - Nu Labours attack dog, begins her mission

Firstrung: Shelter condemns government proposals on social housing

Housing charity Shelter today condemned the Government for suggesting unemployed people should lose their council homes...Shelter chief executive Adam Sampson: "The Government wants to return Britain's unemployed to the workhouse by throwing them onto the streets. What is being proposed would destroy families and communities and add to the thousands who are already homeless.

Posted by converted lurker @ 11:12 AM 7 Comments

See graph in comment 1

Market Oracle: Commodities, Natural Resources and Precious Metals Forecasts 2008 - Part IV

We are at a fairly good level of profits now, but it projects a nuclear winter in corporate profits dead ahead (see chart below). From Record highs never seen in fifty years, to record lows also not seen in the same period, below the lows of 2001-2002. This chart is a testament to how fiat money and credit creation has made steady growth and economic stewardship become more and more unmanageable over a long period of time. It is clear that monetary policy is also following this wolf wave pattern, either too hot or too cold. Politicians in the western world see these enormous profits and are set to attack the creators and holders of this wealth. There is no consistency, no orderly form to the business and economic cycles, everything now is either booming or busting.

Posted by sold 2 rent 1 @ 10:58 AM 5 Comments

Is the gold price being manipulated?

MoneyWeek: Is the gold price really being manipulated?

According to hardcore gold bugs, Gordon Brown's decision to sell off our gold was down to a scheme to suppress the price, rather than plain old incompetence. And there could be some truth in the conspiracy theories.

Posted by mary @ 10:40 AM 4 Comments

Majority of consumers expect residential house prices to fall slightly over the next six months

Citywire: Even rate cut won't help consumer confidence, Nationwide says

Increasing job insecurity and spiralling oil and food prices have further dented already fragile consumer confidence, according to new research from Nationwide building society. Volatile equity markets and a weaker exchange rate may also be contributing to consumer gloom, according to the monthly Nationwide Consumer Confidence Index.

Posted by jack c @ 10:12 AM 1 Comments

HPI is now beneath the apparently magic 9% mark

Market Oracle: Bank of England Interest Rate Policy Targets UK House Price Inflation

Whatever econometric model says 9% annual house-price growth is vital to the nation's well-being, the Old Lady has stuck to it since she gained "operational independence" back in May 1997.

Posted by sold 2 rent 1 @ 09:44 AM 22 Comments

Oppsss, my landlord is losing £471 a month!

Times: Poor lookout for homeowners losing £470 a month

"Since house prices peaked in August, the average home has fallen in value from £199,600 to £197,244. It sounds a modest decline, and the penny may not have yet dropped among the millions who see their homes as places to live in rather than their main retirement fund. Once homeowners start to realise they are getting poorer at the rate of £471 a month, the residual heat in the British economy will very quickly fade."

Posted by confused76 @ 09:19 AM 9 Comments

Symptoms of a Sick Society?

Telegraph: Debt juggernaut rolls us into a madhouse

Even the Financial Services Authority, the regulator that's so dozy it failed to spot the cracks in Northern Rock, has woken up to the debt threat. Last week, it warned: "We are concerned that many consumers are ill-prepared for a deterioration in economic conditions and may have placed too much reliance on their ability to depend on cheap credit and housing wealth."

Posted by quiet guy @ 09:19 AM 0 Comments

London sinking

Times: Fears for the housing market spread to prime Central London

"Worries over the housing market have spread to Central London, where prices for prime houses and flats in the £1 million to £2 million bracket were flat, Knight Frank, the estate agent, reported. Prices of Central London property worth up to £1 million rose by only 0.2 per cent in January, while homes priced in the £1 million to £5 million bracket rose by 0.7 per cent as demand fell among bankers with smaller bonuses to spend." I suspect the "flat" refers to a gridlock market. Property realization prices will fall sharply now that many are falling under the auction market.

Posted by confused76 @ 09:18 AM 1 Comments

Changes to the points system, which come into effect on 1 September, will award five valuable extra points for people who can pass a standard English language test, a Brit-friendly policy partly designed to lure more "poms" here.

bbc: for Brits to make their homes Down Under.

The Lucky Country is facing a chronic skills shortage, and wants Brits to make their home in this "help-wanted" nation

Posted by chris @ 03:33 AM 0 Comments

Dashing up the beach together, they look like part of a "pom" invasion of Australia. And in many ways they are.

bbc: 'Pom invasion' hitting Down Under

The number of British people emigrating to Australia has already increased from 8,749 in the year from 2001 to 2002 to 23,290 in 2005 to 2006. http://news.bbc.co.uk/2/hi/uk_news/6972076.stm

Posted by chris @ 03:31 AM 0 Comments

Well, Duh! Everybody, everywhere is exposed to subprime

North Carolina Times: Lenders freeze equity lines in response to tumbling property values

Several banks issued statements this week saying they were temporarily suspending withdrawals from open home equity lines out of concern that borrowers could owe more than the house is worth. Historic declines in property values have stripped many local homeowners of their safety nets as lenders freeze lines of credit ---- even on people who are current on their mortgage payments. "It's an emotional hardship," said Patti Lien of Menifee. "We kept our credit good. We've done everything right, and this is what we get because Countrywide made all these crappy loans." Home equity lines of credit are loans that use a home as collateral and allow the borrower to withdraw money up to a maximum credit limit.

Posted by lvmreader @ 02:22 AM 0 Comments

Fears for the housing market spread to prime Central London

The Times: Business Article

Even that area is not sacred?

Posted by orwell @ 12:15 AM 0 Comments

Tuesday, February 5, 2008

Risk of property defaults growing

Financial Times: Risk of property defaults growing

There is a growing risk of defaults on loans on commercial property this year, in a trend that could spill over into tumbling values and create more jitters in the credit world, analysts and bankers warn. Signs of growing stress also exist in the UK commercial property sector. Tomorrow, UK group British Land is expected to announce a sharp writedown in the value of its commercial property.

Posted by andrew collini @ 11:37 PM 0 Comments

THE beams are creaking. Plaster is falling from the ceiling. The cracks in the walls are widening. The entire edifice of wholesale financial markets is under the greatest strain in years.

AUSTRALIAN: Bond insurers take another brick from a shaky wall

THE beams are creaking. Plaster is falling from the ceiling. The cracks in the walls are widening. The entire edifice of wholesale financial markets is under the greatest strain in years.No one any more believes the soothing noises from the builders (aka investment bankers), who say the worst will soon be over.On Thursday there was a fresh buckling noise coming from the foundations, where the monoline insurers reside. These are the institutions that insure trillions of dollars of bond issues against default. Having strayed from their original safe but dull role of insuring municipal bonds to underwriting racy sub-prime backed securities, they are paying the price. One of the biggest, MBIA, announced a $US2.3 billion ($2.6 billion) loss, while another, FGIC, was downgraded by Fitch.

Posted by chris @ 11:24 PM 0 Comments

Poor BTLetter, used, abused and thrown into the garbage bin!

FT: Buy-to-let lifts house prices 7 per cent

“In any analysis of BTL, it is important to consider the wider benefits [to the economy],” said Stephen Nickell, chairman of the NHPAU. “Together with the regulatory changes in the 1980s, the expansion of BTL lending has supported growth of the private rented sector, which now provides homes for 3m households. Increased competition has kept rents low relative to house prices.” The studies also examine how buy-to-let investors might behave if house prices start to fall. Without the assumption of continued increases, investors may chose to sell. “Given that BTL investors have boosted house prices during the boom, the likely drying-up of new investor demand is another reason to expect house prices to fall back in the coming years,” What an i@iocy MAU HAHAH HAHAH AHH

Posted by confused76 @ 09:18 PM 2 Comments

US Mortgage holders don't tough it out anymore, but we do

globaleconomicanalysis: US Homeowners Confound Predictions

"When American households have faced hard times in previous decades, they tended to default on unsecured loans such as credit cards and car loans first – and stopped paying their mortgage only as a last resort. However, in the last couple of years households have become delinquent on their mortgages much faster than trends in the wider economy might suggest... So there has been a failure in some of the key assumptions which supported banks analysis and modelling" I wonder, will the UK follow this trend and so will UK models need revision? Perhaps the resilience of our housing market is that we have not changed yet. It is still a case of "An Englishman's Home is his Castle"?

Posted by happyrenterz @ 08:35 PM 5 Comments

Halifax is far too optimistic on the housing market

MoneyWeek: Halifax is far too optimistic on the housing market

The latest data from the Halifax show falling house prices and mortgage approvals. So why this lender sticking to its forecast for 0% growth in 2008?

Posted by mary @ 05:44 PM 7 Comments

Mmmm, those rate cuts and money parcels are really helping... NOT!

BBC: US service sector in sharp fall

Greed has been replaced by fear - Japan style 'lost decade' on the way? The US service sector contracted in January for the first time in almost five years, a survey has shown. The Institute for Supply Management's index of service sector business activity fell to 41.9, from 54.4 for the previous month. The dividing line between growth and contraction is 50. The unexpectedly weak reading stoked fears that the US would fall into recession.

Posted by tyrellcorporation @ 04:58 PM 6 Comments

Some consumers paid in many cases £45,000 over market value for properties

Citywire: FSA and police battle nationwide property price fraudsters

Regulators are changing rules to crack down on mortgage scams that sell new-build flats at inflated prices, the Council of Mortgage Lenders (CML) says. The council and the Financial Services Authority (FSA) are working with police to determine the extent of a nationwide scam that has mostly targeted lenders and some consumers to pay in many cases £45,000 over market value for properties.The elaborate fraud appears to involve crooked brokers and introducers, complicit house-builders, and fraudulent surveys.

Posted by jack c @ 04:08 PM 25 Comments

68% of lenders surveyed believe buy-to-let repossessions will increase, with new build flats citied as most at risk

Mortgagestrategy: Increase reported in second charge repossessions

A third of mortgage lenders have seen an increase in the number of repossessions initiated by second charge providers, Moore Blatch has revealed.The repossessions survey, which interviewed high street banks, building societies and specialist lenders also found that 80% are expecting repossessions to rise this year and 40% believe this could be by as much as 15%.Lenders identified first-time buyers as the most vulnerable to repossession.

Posted by jack c @ 03:57 PM 1 Comments

Is it possible for IR to move into minus figures?

Bloomberg: Treasuries Rise as Service Industries Contract, Stocks Decline

"Feb. 5 (Bloomberg) -- Treasuries rose, pushing two-year note yields close to a four-year low, as a report showing service industries unexpectedly contracted last month added to speculation the Federal Reserve will cut interest rates further." Theres going to be a surplus of cheap paper on the world markets!

Posted by cheekie charlie @ 03:23 PM 0 Comments

Watch coal go!!! - Not sure how much coal we need now for power generation but it has to increase inflation along the line.

BBC: Coal prices surge to record high

Coal prices have soared to a record after serious disruptions at some the world's most important coal producers. The benchmark price in Asia jumped 25% to $116 a tonne.

Posted by tyrellcorporation @ 12:39 PM 16 Comments

Is this some kind of parallel universe?

Reuters: £2trillion equity in British homes

Homeowners have almost two trillion pounds of wealth tied up in their properties -- providing a huge buffer against a house price downturn. Britons have property equity worth 1.95 trillion pounds, once outstanding mortgage debt is taken into account, according to GE Money Home Lending. A quarter of homes are owned outright. The average homeowner has £127,455 of mortgage-free wealth tied up in the home, giving a considerable buffer against short-term house price falls.

Posted by little professor @ 12:33 PM 28 Comments

What the Federal Reserve's rate cuts mean for the US and the world

MoneyWeek: How the Fed just made this crisis a whole lot worse

The Fed's rate cuts and $156bn fiscal stimulus package may have reduced the risk of near-term economic downturn, but it has increased the scale of a long-term crisis...

Posted by mary @ 12:29 PM 1 Comments

More mortgage pain coming to OZ...

BBC: Australia raises interest rates

Australia has raised interest rates to an 11-year high of 7%, as part of efforts to control rising inflation. The rise comes as other major central banks are cutting interest rates to ease an economic downturn.

Posted by tyrellcorporation @ 12:26 PM 3 Comments

Rics - reduced loan-to-value ratios and lenders’ more cautious policies were ‘clearly having an impact on the availability of finance for property purchase’.

Citywire: Mortgage slump lowest in nine years, says Bank of England

The number of mortgages issued to home buyers has sunk to the lowest point since 1999, according to Bank of England figures.Mortgage approvals from banks and building societies fell to 73,000 in December from 81,000 in November. The value of the mortgages approved in December was £25.4 billion, a small drop from November’s figure of £26 billion.Ian Kernohan, economist at Royal London Asset Management, said the mortgage approval numbers ‘indicate that the current housing slowdown is more pronounced than in 2005’.

Posted by jack c @ 12:17 PM 4 Comments

''sound economic fundamentals'' - what a joke!

Times Online: Halifax doubts house price crunch despite fall

''Martin Ellis, Halifax’s chief economist, dismissed wholescale price falls predicting instead sound economic fundamentals and lower interest rates to support house prices. ''

Posted by hpwatcher @ 10:59 AM 10 Comments

What Alistair Darling could learn from Ryanair

MoneyWeek: What Alistair Darling could learn from Ryanair

Tough-talking Ryanair sent a shiver through the airline industry yesterday with its warning that 'recession is imminent - if not already upon us'. At least they're facing up to tougher conditions, unlike the Chancellor.

Posted by mary @ 10:57 AM 1 Comments

Food for thought

Market Oracle: Western Democracies Have Evolved Into Tyrannical Governments

The ruling class knows how to maintain stability. Keep the masses distracted, fearful, brainwashed, insecure, and dependent on government and business sectors for survival. Train people to see themselves as relatively free consumers. Maintain the myth that ordinary people can become wealthy and join the ruling class, which theoretically is not impossible, but of no statistical significance for the masses.

Posted by sold 2 rent 1 @ 09:38 AM 35 Comments

Halifax prices down 1% for the quarter

Guardian: UK house prices flat in January-Halifax

they can fake the monthly stats, but they can t hide that prices are falling. 1% per quarter! 4% per year? any guess? "HBOS Plc's Halifax house price survey on Tuesday also showed house prices in the three months to January were one percent lower than in the previous quarter, the third successive fall on this basis" So it is the 3rd month that quarterly prices are down... HBOS are amazing! they are correcting the previous monthly stats!

Posted by confused76 @ 09:16 AM 4 Comments

The Royal Bank of Scotland is scrambling to reassure investors that it has a robust capital base in the face of increasing speculation that it needs to plug an estimated £12.5bn gap in its finances

guardian: RBS faces tough questions over £12.5bn finances gap

The Edinburgh-based bank is facing tough questions from City analysts and investors about whether it needs to conduct a rights issue or sell off assets to raise funds. There are also concerns that it might need to write off more losses from its exposure to financial instruments linked to the sub-prime mortgage crisis.

Posted by chris @ 09:05 AM 1 Comments

I would have expected to see strong falls....

BBC News: House prices unchanged in January

This should rule out interest rate rises then......''House prices were unchanged in January compared to the previous month, according to the Halifax bank. However, the country's biggest mortgage lender said that house prices were rising at an annual rate of 4.5%.''

Posted by hpwatcher @ 08:27 AM 51 Comments

Costa del Market Manipulation Fiscal Rescue

Telegraph.co.uk: Concerns over Spanish government's housing rescue plan

The Spanish government is reportedly considering a rescue package to "refloat" the housing market and slow job losses in the construction sector, raising concerns over investor appetite for the country's sovereign bonds. Premier Jose Luis Zapatero is eyeing the Public Credit Institute for a €10bn (£7.5bn) credit line to help developers and homeowners weather the squeeze following the partial closure of the capital markets, according to the financial daily Expansion. The Credit Institute is an arm of the Spanish treasury, used to promote technology and green energy. The government has also proposed a tax rebate of up to €400 per person, comparable in scale to the new fiscal package proposed by George W Bush in the US......

Posted by ski @ 08:13 AM 0 Comments

AUD is highly overvalued compared to levels implied by long-run equilibrium and will have to see a significant correction

actio forex: We will therefore consider going short AUD when we see one of these triggers.

. When this correction will take place, however, and how gradual it will be, is uncertain. While relative growth and interest rates remain favourable, three factors will weigh on AUD in 2008, as global growth slows, commodity prices peak, and global risk aversion remains high or rise. We will therefore consider going short AUD when we see one of these triggers. AUD could, however, see relief in the very short term, if Q4 inflation numbers released on 23 January turn out to be above the RBA forecast. This would most likely trigger an interest rate hike at the 5 February meeting, which is now only priced with a 40% probability by the market. We do in fact expect the RBA to hike the policy rate by 25bp at the February meeting, although it is a very close call.

Posted by chris @ 04:36 AM 4 Comments

Monday, February 4, 2008

CML report calls for action to stop lenders being duped

BBC Panorarma site: Bursting the House Price Bubble

The CML report raises concerns that lenders have been duped by unscrupulous property developers, who use hidden payments to buyers (eg for legal fees, cash back etc) to keep land registry prices for their developments falsely inflated. Last nights Panorama reveals the tip of a rather massive iceberg and potentially hundreds of solicitors/surveyors/valuers could and should face prison for fraud.

Posted by mikelivingstone @ 11:16 PM 22 Comments

If China were to slow dramatically, while growth in Europe and the US was still weak, recent low global interest rates, high commodity prices and strong global growth would be history

FT.com: China may yet be economy to lose sleep over

Rather than deal with inflation through price caps, China should accelerate exchange-rate appreciation, thereby reining in money growth. . Global policymakers and investors who are losing sleep over US growth ought to pay more attention to rising risks coming from the other side of the globe. The writer is professor of economics at Harvard University and former chief economist at the IMF

Posted by chris @ 10:52 PM 2 Comments

Another property fund shuts up shop

fundstrategy: Axa takes action to protect property funds

The list grows...."What has surprised [these funds] is the pace of the downswing." It will be interesting to see what happens in six months time if things don't "settle down" as all these managers are hoping...will they let their investors cash in, or will they extend the lock-up?

Posted by jackas @ 10:24 PM 0 Comments

Busting the myth that HPI creates wealth

Times: The 'poor' £2M homeowner

8 years ago, my husband and I bought a gutted Hampstead maisonette with no floorboards, kitchen or bathroom for £750,000. Our property has now been valued at £2million. Happy? Of course - it would have been difficult to have made a better investment. But there is one problem: living in one of the priciest areas in the capital is making us feel poor. If people were to sell up and move somewhere cheaper, they could probably retire comfortably on the proceeds. The trouble is, they want to stay and enjoy the good schools, nice neighbours and amenities that attracted them to the area in the first place. So they remain tied to their house with golden handcuffs.

Posted by little professor @ 09:06 PM 14 Comments

Spring is gonna be a little late, maybe 5years or so late.

New York Times: House Prices Start to Dip, Recalling 90's Slump

A postcard from the future. Just substitute London into this article from across the pond.

Posted by baudot @ 08:38 PM 1 Comments

oh dear

BBC News: How to rescue the UK mortgage market

UK mortgages could become more expensive and harder to obtain unless there is further help for stricken credit markets, an influential government advisor has said. David Miles, chief economist at Morgan Stanley and a Treasury advisor on the mortgage market, says that UK banks need to refinance £250bn worth of mortgage loans that have been financed in wholesale money markets. He argues that if markets remain frozen, the Bank of England - or a special government agency - will need to lend £60bn to £80bn to the banks this year to prevent mortgage finance freezing up.

Posted by tick tock @ 08:37 PM 8 Comments

Repossesions, negagtive equity & falling house prices.

Mortgage Solutions: Repossessions set to rise, lenders tell Moore Blatch survey

More Blatchs 2008 Repossessions Survey shows 80% of lenders believe repossessions will increase in 2008. First-time buyers are identified as the most vulnerable to repossession and 32% of lenders anticipate an increase in shortfalls after sale, which can cause negative equity. The report also found 68% think buy-to-let possessions will increase, new build flats are most at risk and 88% think buy-to-let should be regulated as if it were an investment product.

Posted by jack c @ 04:35 PM 1 Comments

Don't we all already know this?

BBC "News": Family finances 'being squeezed'

Family finances are being hit as bills and taxes rise faster than incomes, a centre-right think tank warns. The Centre for Policy Studies says the average household pays 7,800 a year more tax than when Labour took power. It adds that rising mortgage interest and household bills have left families struggling with "excessive" debt. The government says the tax burden on a single-earner family with two children is lower than in 1997, with tax credits meaning 40% of families pay no net tax.

Posted by dave the box @ 04:23 PM 3 Comments

Exploding the myth that insolvency is a ready made option for the over indebted

Firstrung: Experian warns that insolvency is not an easy way out of debt

Experian, the global information services company, today reminded consumers of the serious consequences of opting for bankruptcy or an individual voluntary arrangement (IVA) as a way of dealing with debt. The publication of two Experian fact sheets, 'Your credit report and bankruptcy' and 'Your credit report and individual voluntary arrangements', coincides with the launch of an Insolvency Service-facilitated IVA protocol that sets agreed standards on how credit and IVA providers will work together to help people in serious financial trouble resolve their debt difficulties.

Posted by converted lurker @ 03:20 PM 0 Comments

30-40% of mortgage lending sub prime

Firstrung: Despite the credit crunch UK mortgage market dominated by prime and self-cert residential lending

For all the recent focus on sub-prime mortgages in the US, the UK mortgage market continues to be dominated by prime and self-cert residential lending - and this applies to loans generated both via the intermediary sector and direct to consumer. IMLA, the Intermediary Mortgage Lenders Association, has collated estimates of 2007 mortgage volumes split between direct and intermediary business...

Posted by converted lurker @ 03:16 PM 11 Comments

Mortgage lenders call for tighter rules rather than do their own homework

BBC News: Lenders warn about mortgage fraud

The CML pointed to the substantial incentives that can keep the headline sale price of a property unchanged, while reducing the actual cash needed by a buyer to go through with the deal - legal fees and stamp duty, cash-backs, offers of free holidays, the supply of white goods or even the arrangement of reduced mortgage payments.

Posted by ontheotherhand @ 02:43 PM 18 Comments

The property profiteers

The Guardian: The property profiteers

"The frenzy to speculate on the housing market or own multiple homes has a dangerous downside"

Posted by becky @ 12:31 PM 50 Comments

Can Bernanke beat the Bear?

MoneyWeek: Can Bernanke beat the Bear?

Ben Bernanke believes that central banks can protect the economy from the effects of a stock market collapse. But can his - or indeed any - policies succeed?

Posted by mary @ 12:00 PM 0 Comments

Bursting the House Price Bubble

Panorama 8.30 tonight: Bursting the House Price Bubble

If sentiment is the most important factor in the house price bubble, then programmes such as this go a long way towards helping burst it. Don't forget "Repossession, repossession, repossession" on ITV Wednesday 10.35 as well.

Posted by monty032 @ 11:54 AM 13 Comments

Hundreds claim credit cards were axed because they make no money for firm

Guardian: Anger at Egg ban on prudent customers

Senior MPs are demanding an Office of Fair Trading investigation into greedy banks after Egg's decision to ban 160,000 customers from using their credit cards dramatically backfired.

Posted by landedgentry @ 11:43 AM 10 Comments

Excellent! BTLeaches will lose out under new CGT rules

HomeMove: Landlords excluded from CGT entrepreneurs relief

"effect of increasing the minimum rate on capital gain for those selling a property held for longer than ten years, from 10%, to 18%" The relief will apply to gains arising on disposals of the whole or part of a trading business (not including a property letting business other than furnished holiday lettings). Large landlords running their operations as a full-time registered business may possibly benefit from the relief but tax experts agree that this is unlikely." Here we go!! are you in for the long term? Then pay a sh*tload of taxes! You are leveraged like hell? Then pay a awesome tax rate (since you have to return the full principal to the bank!) AH HAH... the power of taxation beats "the power of leverage".. BTL = poor i@iots

Posted by confused76 @ 11:18 AM 10 Comments

The tip of the iceburg!

BBC "News": Egg customer anger at credit move

Egg says 161,000 cards belonging to people whose credit profiles have deteriorated since they signed up will stop working in 35 days' time.

Posted by dave the box @ 10:20 AM 0 Comments

What would you do?

Times Online: Inflationary pressures act as curb on rate cut

''Anyone expecting similar drama from the Bank of England is likely to be disappointed. The MPC prefers quarter-point steps to larger cuts or rises. The Bank last cut rates by 50 basis points more than six years ago, in November 2001, a move prompted by fears of a global recession after the September 11 terrorist attacks. Mr King sounded a warning two weeks ago not to expect any Fed-style dramatic moves. ''

Posted by hpwatcher @ 09:46 AM 16 Comments

The financial sector was seen showing the weakest performance in the fourth quarter, a 94 percent fall, amid reports of big write-downs and exposure to capital-strapped bond insurers.

reuters: Wall St. lowers S&P 500 earnings outlook: survey

NEW YORK (Reuters) - Wall Street analysts have lowered expectations for U.S. corporate earnings in the first two quarters of 2008, after results for the fourth quarter showed conditions much worse than initially expected, according to a weekly survey by Reuters Estimates.

Posted by dangerous trading @ 09:06 AM 0 Comments

Setback for monoline rescue

ft: increasing the pressure on banks to come up with a rescue package for the bond insurers.

Leading private equity firms are unlikely to participate in any recapitalisation of Ambac and MBIA, increasing the pressure on banks to come up with a rescue package for the bond insurers.

Posted by dangerous trading @ 08:43 AM 2 Comments

Life and pensions giant Axa has become the latest firm to bar redemptions from its Life Property and Pension Property funds for up to six months in a bid stop panic selling.

daily mail: Axa bars property investor withdrawals

Life and pensions giant Axa has become the latest firm to bar redemptions from its Life Property and Pension Property funds for up to six months in a bid stop panic selling. The decision will affect 100,000 investors . is the latest in a growing list of firms to take such action to restrict access to their assets to prevent a Northern Rock-style run on their resources.

Posted by dangerous trading @ 07:20 AM 4 Comments

The Debt Based Economy Starts Buckling

Telegraph: Fears of 100,000 job losses in retail sector

The expected cull - equivalent to one in 30 shop jobs in the UK - far outstrips any previous prediction and underlines just how difficult the coming 24 months are expected to be on the high street.

Posted by quiet guy @ 02:39 AM 13 Comments

Sunday, February 3, 2008

More property companies will be pushed to the brink of collapse with conditions likely to worsen sharply

AUSTRALIAN: Further property trouble predicted

"The room is not on fire yet, but I'm standing close to the exit door," Mr Parsons told a Property Council of Australia market outlook lunch in Sydney yesterday. Market confidence has been savaged by the near collapse of Centro Properties and MFS, with 23 per cent wiped off the value of LPTs since Centro's cash crisis came to light in December.

Posted by dangerous trading @ 10:58 PM 2 Comments

Bank of England facing biggest rate cut dilemma

times: Bank should cut by a quarter of a point this week while one, Peter Warburton, calls for a half-point reduction

Four of its members, Philip Booth, John Greenwood, Kent Matthews and Trevor Williams, say the Bank should cut by a quarter of a point this week while one, Peter Warburton, calls for a half-point reduction

Posted by dangerous trading @ 10:43 PM 3 Comments

How much subprime exposure we have seen?

financialsense: The Greatest Bait And Switch Of All Time

Big money, "U.S. insurance companies and pension funds," stopped buying subprime paper in 2003, but subprime housing problems only became obvious in 2007. So who bought the most toxic securities (written at the top of the bubble) 2003-2007? "mainland Chinese banks, the Chinese government, Taiwanese banks, Korean banks, German banks, French banks, (and) UK banks." Bank of China admitted 21 Jan, it was going to have to write down an additional $300 million in, subprime exposure. Western banks are slow in exposing their losses and I imagine China will be even slower. J. Kyle Bass of Hayman Capital Partners says we have only seen the tip of the iceberg.

Posted by happyrenterz @ 10:29 PM 2 Comments

We remain comfortable with the view that EUR/USD will end the year significantly lower than it is now, though in the near term the dollar may not rally.

morganstanley.com: A Hyper-Proactive Fed and the Dollar Smile

We have centred our call on a bounce in the dollar against the EUR and the GBP this year on the thesis that risk-aversion would spike so high as the US falls into a recession that fear-motivated bond flows would perversely support the dollar, just as they did in 2000-01. This thesis has partly worked so far this year, as the sharp erosion in the USDs yield premium should have been extremely damaging for the dollar but the dollar has not collapsed with the FFR. We still feel comfortable with the Dollar Smile framework.

Posted by dangerous trading @ 09:49 PM 0 Comments

"Recession proof" homes shortly to be followed by followed by Bomb proof and bullet proof (to add value)

Telegraph: Property market: Is your home recession proof?

With all the pessimism surrounding the housing market, you would be forgiven for thinking that the whole thing had ground to a halt: no one buying, unless for a hefty discount, and no one selling, unless they are desperate. But even in a bad climate, good homes sell - and not just multi-million pound palaces to oil barons. In a falling market, the puff surrounding properties is stripped away, leaving the bare bones of what makes a home, in any price range, recession-proof: factors such as prime location, great views and proximity to amenities.

Posted by jack c @ 09:25 PM 6 Comments

One to watch - Monday @ 20:30

BBC: Bursting the House Price Bubble

An exposure of sharp practice in the housing market which has kept house prices artificially high and plunged some homeowners into negative equity. Developers, valuers and solicitors all come under the microscope in Raphael Rowe's report, which reveals some nasty surprises for those who joined the buy-to let-frenzy.

Posted by pendulum @ 09:03 PM 8 Comments

Is this a spoof story from BBC?

BBC News: How to rescue the UK mortgage market : 3rd Feb 2008

Treasury advisor David Miles, reckons that BoE needs to chip in another 60Bn or so to keep the housing market moving (the desired direction being upwards I assume from the tone of the article). It sounds far-fetched and unbelievable, but it's on the BBC business pages so I guess it must be true. Hope someone else can read this and convince me it's a practical joke.....please.

Posted by ingermany @ 07:18 PM 4 Comments

A roundup of the state of our Finances etc.

Times Online: The Bugle - Money, Money, Money

Worth a listen! Can't remember if anyone has posted this link - apologies if they have. Not quite HPC but should give you a good laugh regarding everything that effects it.

Posted by it_is_going_with_a_bang @ 06:42 PM 0 Comments

Do UK banks need 100bn

bbc news: How to rescue the UK mortgage market

Here we go! in the next month or so banks in the UK start releasing results and writedowns possible dividend cuts.

Posted by lee @ 06:37 PM 0 Comments

There is a God.

BBC News: How to rescue the UK mortgage market

The result could be that UK mortgage lenders would have to either pay very high interest rates to borrow money from other wholesale investors, or pay higher interest rates to retail savers to attract more deposits. Either way, UK banks would then have to raise mortgage rates sharply in order to cover the higher costs of borrowing - regardless of whether the Bank of England lowered base rates.

Posted by cheekie charlie @ 05:56 PM 1 Comments

Times is becoming cheerleader-in-chief

The Times: Property slowdown: good for FTBs and upgraders?

It's not all doom and gloom, however. The slowdown could be good news not just for first-time buyers, but for people who already own a property and want to trade up. 2008 could be the ideal year to move up the property ladder. "In a slowing market, trade up, and trade up as much as you possibly can.", says Anne Currell, director of Currel Residential.

Posted by little professor @ 02:43 PM 7 Comments

Who is really going to win the Cold War

financialsense: The Cold War Never Ended

Russian energy giant (Gazprom) is invading Western retail energy markets...Russia's increasingly hostile. "We all know that Russian agents unleashed radioactive poison on the streets of London. British officials believe that Andrei Lugovoy was Putins henchman in the matter. And now, with hardly a squeak from so many political pips, Lugovoy is a member of the Russian parliament with full legal immunity. In a recent interview with Megan Stack, published in the 27 January Los Angeles Times, Lugovoy said: I dont believe the Cold War is back. It has never ended. Gorging ourselves into unsustainable debt it is capitalism stumbling and it is China becoming the next world financial superpower. So who did win the cold war?

Posted by happyrenterz @ 01:42 PM 6 Comments

The insolent sheeple have have turned against their shepard(Crash Gordon) and left the sheep dog(david smith) feeling lonesome in the fields while they bolt on mass in the general direction of the slaughter house.

moneysavingsexpert: 'Will house prices crash in 2008?' Poll Results & Discussion

Theres been a massive shift in what people think will happen to house prices over the next year since since I ran this poll six months ago. Total Voters: 10,844 this time (9.811) Average Sentiment. House prices to drop 5.5% over the next year (drop of 0.6%). Voters predicting a rise: 17.5% of people predicted a rise (48%). Voters predicting a fall: 59% of people predicted a fall (30%). Does sentiment matter? Yes, when people think prices will drop they act differently, theyre far less willing to pay higher prices, and thus theres the potential for a self-fulfilling prophecy

Posted by cheekie charlie @ 12:03 PM 1 Comments

A Northern Rock style crisis is threatening Iceland's entire banking system

Telegraph: Is Iceland headed for meltdown?

Based on prices quoted in the credit markets, international investors reckon Kaupthing, Iceland's biggest bank, is about seven times more likely to default than the typical European bank. Moody's, the credit rating agency, last week placed the entire Icelandic banking sector on review for a possible downgrade. Standard & Poor's has warned that the major institutions - Kaupthing, Glitnir and Landsbanki - are facing tough times.

Posted by cheekie charlie @ 11:17 AM 4 Comments

one to watch

tv listings: Repossession, Repossession, Repossession

During the past decade, Britain has grown accustomed to living the high life on debt. Now, as home repossessions and bankruptcies soar, business journalist Jeff Randall investigates how and why the nation got hooked on spending money it doesn't have - and concludes that people are about to wake up to the painful realisation that all debts eventually have to be paid SUB General Education/Science/Factual Topics Wednesday 6th February on ITV1 from 10:35pm to 11:35pmSearch all related TV Shows.

Posted by waitingtobuy @ 10:43 AM 0 Comments

Very bearish article indeed

Guardian: Property market teetering on brink of collapse

Last week the Financial Services Authority issued its starkest warning yet that the housing market is in dire straits. The FSA says homeowners most likely to struggle are those with a term over 25 years, 90%+LTV, and over 3.5x income multiples. The news follows a rash of small price falls in monthly indexes from Nationwide, Halifax and Rightmove. We may be in for a long period of gradually declining prices. Property cycles run for a long time: it was 1996-7 when house prices finally entered a new upward cycle, after five years of falling .

Posted by little professor @ 10:35 AM 5 Comments

They warned us the housing market would crash ... four years ago

Independent: City Diary

... so it must have been with glee that the founders of housepricecrash.co.uk a website set up in October 2003 (great timing, guys) took the news from Nationwide last week that UK house prices had fallen for a third consecutive month..

Posted by Paulm @ 10:20 AM 10 Comments

Top in silver in May or June

Safe Haven: Silver Update

Silver will spike to $20-30 in the next 6 months if we follow the trend of 2004 and 2006

Posted by sold 2 rent 1 @ 10:11 AM 13 Comments

Cheeseleaders don't smile

Times: The Bricks Chicks on the demise of the dining room

Embarassing and cheesy as usual, but this time the cheeseleaders don't smile: all the indicators they flash on camera point to a long, steady downward trend in house sales and prices. Nationwide prices slide 0.1% (but we know it was 0.9% without seasonal adjustments). Sellers accept 93% of asking prices. People prefer to improve their house rather than moving. But does that benefit FTBs? No, still they cant afford. Is that good or bad? mmmm... I am a BriskChick, let me find my brain, where did I leave it after dinner last night? ... if FTBs cannot afford, then who buys?... I got it! the BTLetters that can rent out to the FTBs who cannot afford! yes but how can FTBs afford to pay the rent if they have to save harder to buy?... mmmm... where is my brain...

Posted by confused76 @ 10:09 AM 0 Comments

David Smith counts skips on his street

DavidSmith Economics UK: The world is buoyant but UK rates have to fall

"readers will know I set great store by my "skip index", based on the number of builders skips in my street two indicating the economy is on trend, four a boom, and none that we are in trouble. Despite extensive searching this past couple of weeks, sometimes at night, the index is still firmly on zero. Weak housing and subdued consumer confidence is taking its toll and I dont suppose the weather is helping." The article also contains a strong pledge to cut rates... desperate!!! This is the final proof that this buffoon is a heavily geared BTL investor... count the skips, prop the housing market!

Posted by confused76 @ 09:18 AM 18 Comments

David Smith endorses price fall predictions but... shortlived

Times: davidsmith: Home economics

"by the fourth quarter, the average house price will be 187,900, 2.5% down on the final three months of 2007 and 5.5% below the peak of 198,900 reached last summer" but there is a catch... "the downturn, caused as it is by the credit squeeze and temporary strains on household finances, will be short-lived. Prices in 2009 will rise by 3%, it predicts, followed by above-inflation rises in the following two years."

Posted by confused76 @ 09:14 AM 0 Comments

Rent seekers: go to h@ll!

Times: Earthquake at British Land as 1.3bn is wiped off portfolio

"the groups net asset value per share will have plunged by more than 16% since the end of September to about 1,400p a share. That will make it one of the steepest drops in living memory. It would imply a fall of at least 10% in the value of the groups 13.2 billion property portfolio" ... but of course residential property is different... H AHA HHH AHHAHHA HHAHAAHHAHHAH H... BTLetters your days (hours in fact) are counted

Posted by confused76 @ 08:34 AM 1 Comments

Dilemma for the ECB

BBC News: Eurozone inflation at new record

Consumer prices are now growing at their quickest rate in the 15-nations eurozone since records began in 1997. The rate is much higher than the European Central Bank's target of 2%. The ECB faces the tough challenge of controlling inflation, which can be done by raising interest rates, at a time when the economy is slowing. The problem is similar in the UK

Posted by sirgoogle @ 06:47 AM 1 Comments

Dollar seen higher despite soft US payroll

reuters: Analysts said there were signs that dollar bears were starting to throw in the towel in the face the U.S. currency's resilience

The dollar may rise next week after the greenback fought off new lows against the euro in the wake of two deep Fed rate cuts and dour economic data.

Posted by dangerous trading @ 04:47 AM 2 Comments

Saturday, February 2, 2008

First of many? Bank reimburses city for miss-selling securities

globaleconomicanalysis: Merrill Lynch Opens Legal Hornet's Nest

Discussion of various misselling cases. In one case a school required money for building renovations. They were talked into a credit default swap by JPMorgan Chase which gave them $750,000. "What New York-based JPMorgan Chase didn't tell them, the transcript shows, was that the bank would get more in fees than the school district would get in cash: $1 million." With the credit crunch things went wrong and the school board paid $2.9 million to JPMorgan to get out of the deal. Tax payers money for education!

Posted by happyrenterz @ 10:55 PM 3 Comments

Evil & Greedy Inv Banks rip off broke school

Bloomberg: Hidden Swap Fees by JPMorgan, Morgan Stanley Hit School Boards

A JPMorgan banker, told Barker and the school board on Sept. 4, 2003, that all they had to do was sign papers he said would benefit them if interest rates increased in the future, and the bank would give the district $750,000, a transcript of the board meeting shows. ``You have severe building needs; you have serious academic needs,'' Barker, 58, says. ``It's very hard to ignore the fact that the bank says it will give you cash.'' So Barker and the board members agreed to the deal. What New York-based JPMorgan Chase didn't tell them, the transcript shows, was that the bank would get more in fees than the school district would get in cash: $1 million. The complex deal, which placed taxpayer money at risk, was linked to four variables involving interest rates.

Posted by lvmreader @ 10:16 PM 2 Comments

Private profits, public losses and the human cost of the US slump

Bloomberg.com: Wall Street Embraces Government to Avoid Recession (Update1)

"The worst drop in new home sales on record has turned financial leaders into champions of big government with everyone from Russo to executives at Citigroup Inc. and JPMorgan Chase & Co. supporting public measures to keep the housing market from sinking the economy." ... ""This has reached the point of being catastrophic,'' said McCarthy, who declared bankruptcy in July when his business failed after 18 years. "I had a client who called me sobbing because his wife committed suicide rather than face eviction. Something's got to be done to help people.''"

Posted by quiet guy @ 09:18 PM 4 Comments

Forrest says "Life is Like a Box of Chocolates"

Yahoo Finance: Housing Meltdown: 25% Decline Ahead?

They all melt when the temperature is rising & its getting very warm for some.

Posted by acetip @ 08:47 PM 0 Comments

subprime disaster: when economic growth doesnt lead to increased wages

washingtonpost: The Boom Was a Bust For Ordinary People

"And why were so many Americans poor enough to turn to subprime mortgages and other dodgy credit schemes? The chief reasons are low wages and job insecurity... For years now, we've had a solution, or at least a substitute, for low wages and unreliable jobs: easy credit. Payday loans, rent-to-buy furniture and exorbitant credit card interest rates for the poor were just the beginning. In its May cover story on "The Poverty Business," BusinessWeek documented the stampede to lend money to the people who could least afford to pay the interest on it: "

Posted by happyrenterz @ 07:23 PM 1 Comments

Halifax annual county survey out

Sky News: Housing boom sees prices treble

House prices have trebled in nearly half of all UK counties over the past 10 years, Halifax says. Co Armagh was the best performing county, with prices rising by 331% between 1997 and 2007. Of the top ten performing counties, 5 were in Northern Ireland. Cornwall and the Isle of Wight were the only English counties to make the list. Overall, Halifax said 44 out of 104 counties had seen at least a trebling in average house prices during the past decade and all counties have recorded at least a doubling.

Posted by little professor @ 04:52 PM 14 Comments

Those who took out huge mortgages while property prices were soaring have been left exposed by the market downturn.

Daily Mail: The return of negative equity: Thousands at risk of owing more on homes than they are worth

Thousands of families are at risk of plunging into negative equity if house prices fall by even a small amount, experts warned yesterday. Those who took out huge mortgages while property prices were soaring have been left exposed by the market downturn. Credit ratings agency Experian have drawn up a map showing which areas of the country are most at risk from a fall in prices. It found that in some parts of Britain, the average mortgage debt is more than 90 per cent of local property prices. This leaves owners vulnerable to negative equity - where the amount owed on the home is more than it is worth.

Posted by jack c @ 04:21 PM 7 Comments

Big reality check coming to TV screens everywhere

UnReality TV: Repossession Repossession Repossession Coming To ITV

From the title of it, it looks promising, so fingers crossed this should inform the ding-a-lings, VI's and non believers of this country of the pending storm which they have sewn and the dire situation they are going to have to face. Wednesday 6 February 2008 10:35pm - 11:35pm on ITV1

Posted by mr cobblepot @ 03:02 PM 7 Comments

Remember - It is different over here!

BBC News: US sees job cuts as economy cools

The American Government thinks it can spend its way out of recession with "heavy doses of monetary and fiscal stimulus".

Can we do that or has the money already been spent?

Posted by enuii @ 12:38 PM 1 Comments

TODAY at 4pm: Tell Channel 4 what you think

Channel 4: The TV Show for Channel 4

Don't miss your chance for some feedback on the property porn C4 has been peddling

Posted by doomwatch @ 11:53 AM 0 Comments

More unemployment then!!!

Telegraph: 1.9m on benefit 'should go back to work'

Up to two thirds of people claiming incapacity benefit are not entitled to the state handout, the Government's new welfare adviser warns today.

Posted by stevie dee @ 11:33 AM 20 Comments

Btl Anybody??

thisislondon.com: The return of negative equity: Thousands at risk of owing more on homes than they are worth

Thousands of families are at risk of plunging into negative equity if house prices fall by even a small amount, experts warned yesterday. Those who took out huge mortgages while property prices were soaring have been left exposed by the market downturn.

Posted by waitingtobuy @ 10:25 AM 1 Comments

Shelter update 'Cathy come home' message

Firstrung: Patsy Palmer stars as homeless mum in new Shelter film

Actress Patsy Palmer is starring in Trapped, a dramatic new film launched today by housing and homelessness charity Shelter. The ex-Eastenders star plays married mum of three Lynn Jackson, who is desperate to escape her run-down flat on a council estate in London. The film depicts her struggle to keep her young family together as poverty and misfortune eventually leads to their tragic descent into homelessness

Posted by converted lurker @ 10:16 AM 3 Comments

Credit crunch leaves customers with egg on ther face

Firstrung: Egg credit card stunt an early warning signal of more pain to come

David Kuo, Head of Personal Finance at Fool.co.uk:"We are not surprised that Egg has stopped 161,000 customers from spending more on their credit cards. This is only to be expected as banks review the quality of their customer base as the credit crunch unfolds. "However, the swiftness of its response is likely to catch many consumers on the hop. We therefore urge all card customers, especially those between 34 and 49 years of age, to take special care

Posted by converted lurker @ 10:13 AM 16 Comments

House prices dwon by 7.3% in 2007, a swing of 20% over the year

Firstrung: First time buyers in Ireland see house prices fall in 2007

The 2007 year-end edition of the permanent tsb House Price Index - compiled in association with the ESRI - reveals that house prices nationally declined by 7.3% in 2007 - compared to an increase in average national prices of 11.8% during 2006. The average price paid for a house by a First Time Buyer stood at euro260,786 at the end of December 2007. This was a decrease of over euro18,000 compared to December 2006. The index reveals that prices declined more in the second half of the year than in the first with falls in average national prices of 4.7% [second half of year] and 2.6% [first half of year] respectively.

Posted by converted lurker @ 10:10 AM 3 Comments

Projected Housing Meltdown in US

BusinessWeek: Housing Meltdown

Well-informed analysis of ramifications of housing crash in US. Experts predicting 20 to 40% further to fall due to increasing credit crunch. Prices to go back to those of 2000.

Posted by peter smith @ 10:07 AM 0 Comments

Another new term to familiarise yourself with - Option ARMs - and the devastation they will bring.

Reuters: Option ARMS

All this new terminology - SIVs, Monoline insurers etc - here is another you will hear a lot aboutin months to come - OPtion ARMS

Posted by andy hamilton @ 09:44 AM 2 Comments

Egg acts over 'risky' customers

BBC News: Egg acts over 'risky' customers

Credit cards are to be withdrawn from 161,000 Egg customers who it believes pose an unacceptably "high risk". The internet bank is writing to 7% of its customers to give them 35 days' notice of the withdrawal.

Posted by njp @ 09:29 AM 2 Comments

Friday, February 1, 2008

Give the banks credit where credit is due

Daily Telegraph: Give the banks credit where credit is due

In this article, the author, a Head of Capital Spreads whatever that may be claims Much of the personal wealth of this country is built upon house valuations. He then goes on to say this wealth has only been possible because somewhere, at sometime, a bank believed in you and lent you the money to buy. No Sir I say the houses are pretty much as they were ten years ago; theres no wealth generation here. OK - some houses may have been improved, while others are a bit worse for wear, but why should this be classified as 100-200% wealth increase over the last decade. The truth is all youve done is create a massive debt bubble that is at some point going to have to be repaid by recent first time buyers and future generations.

Posted by becky @ 09:54 PM 7 Comments

"Buy-to-let investors are waiting to snap up a good deal"

FT: Rise in rental demand brings boom for landlords

Estate agents are seeing booming demand for rental property as first-time buyers and foreign workers defer buying homes amid continued uncertainty over prices.Agents around London and the south-east in particular are seeing up to 25 per cent more activity in their lettings businesses compared with a year ago. Many have waiting lists of tenants and are finding that new lets take just a few days to fill. Much of the demand is coming from young professionals and City workers who are not prepared to buy into a weak housing market.

Posted by jack c @ 06:34 PM 25 Comments

Listen to Yolanda & Richard

Times: house prices and stock market turmoil

"A week of turmoil on world equity markets and drastic action by the Fed to try to avert a recession in America will have done little to bolster the confidence of housebuyers here"... and Yolanda mentions the "Cityboys"... "but sellers will sit tight" MAH AHHAH UAUUAUUAHAHH A

Posted by confused76 @ 06:13 PM 1 Comments

More housing market intervention ?

Mortgagestrategy: Council gives 16,000 to first home buyers

A London council has launched a controversial scheme to give middle-income residents as much as 16,000 to help get them on the housing ladder. Conservative-run Hillingdon Borough Council hopes the initiative will keep economically viable workers in the local economy. It is not aimed at key workers or those already receiving government supportUnder the scheme, residents who have already secured a mortgage on their first home and have a minimum deposit of 7.5% will see their downpayment matched by the council. The only catch is they must remain in the property for three years, or face paying back part of the cash. The maximum value of the property is capped at 210,000.

Posted by jack c @ 03:42 PM 12 Comments

Lets get those covert Bank resue plans up and running ASAP

Mortgagestrategy: Alliance & Leicester credit rating on the line

Alliance & Leicesters credit rating is being closely monitored as it struggles to secure funding. Standard & Poors, the independent credit rating provider, has placed the banks A+ long-term counterparty credit rating on CreditWatch with negative implications, concluding that a swift return to normal funding looks "increasingly unlikely".

Posted by jack c @ 03:24 PM 2 Comments

Junior gold stocks

Kitco: Juniors - Buy of a Lifetime!

The weekly CDNX/GOLD ratio chart reveals an extreme undervaluation of the junior shares against gold not seen before in the entire gold bull market that started in 2001

Posted by sold 2 rent 1 @ 03:07 PM 9 Comments

The reality of recession

MoneyWeek: Why travel firms, restaurants & mortgage lenders are in for a nasty shock

Recession denial. Everybody's at it these days, from Carluccio's to Thomas Cook. But back in the real world, consumers are starting to feel the pinch, and that means they're not prepared to spend scarcer funds on frothy coffees or a week in the sun.

Posted by sha @ 02:55 PM 2 Comments

Can't wait to see the first BTL bankruptcies in London

CNN: Darkening clouds point to UK house price falls this year

'Markedly reduced housing market activity is now weighing down significantly on house prices, and this seems set to continue for an extended period,' Archer said. 'There is clearly a very real danger that a sharp housing market correction could occur.' Credit Suisse takes a more extreme view than most, predicting UK house prices will fall 10 pct this year. That is a slight shift lower from its forecast for a drop of 5-10 pct, made in the autumn. 'House prices have started to fall and we think leading indicators like the RICS survey, consumer confidence and mortgage approvals will continue to feed into further declines through 2008,'

Posted by confused76 @ 02:22 PM 4 Comments

monoline bailout by (european) banks

CNBC: Big Banks Form Group to Rescue Bond Insurers

"Some of the world's biggest banks have grouped together to rescue mortgage bond insurers, CNBC has learned. The source said the bank group includes RBS, Wachovia, Barclays, UBS, Societe Generale, BNP Paribas, Dresdner and Citigroup." So you can be sure these are the banks holding the most toxic slime bonds.

Posted by happyrenterz @ 01:54 PM 2 Comments

Spread betting on property market fluctuations, you could make a fortune or lose your shirt

Times Online: Spread betting

This article is from exactly a year ago. If you had had a bet then, how would you have fared? I would have lost my shirt (too bearish) Interesting to see the market forecast London av. price Dec 2007 to be 298k, actual was 300K. They know a thing or two don't they! Look at their current spreads.

Posted by wdbeast @ 01:47 PM 3 Comments

22% of Egg customers have cards stopped

Telegraph online: Bad Egg customers have cards stopped

EGG, the credit card provider bought by Citigroup last year, will write to hundreds of customers stopping their cards or cutting spending limits because they have shown a spiralling pattern of failure to pay their debts. Customers who are viewed as too risky to continue receiving credit account for about 22pc - or 2bn - of the total spending on Egg cards.

Posted by saving for a space ship @ 01:10 PM 2 Comments

IVAs down 27.3% on the year - but bankruptcies up

Guardian: Insolvency levels fall for first time in a decade

Over the last three months of the year there were 24,846 individual insolvencies - a decrease of 3.9% on the previous quarter and 16.4% down on the same period in 2006. However, these figures mask a rise in the number of bankruptcies over the year, which increased by 2.4% to 64,480. Both the yearly and quarterly figures have been driven by a marked dip in the number of individual voluntary arrangements (IVAs) - formal agreements entered into by a borrower and their creditors. The number of IVAs set up in the final quarter of 2007 was down 8.3% on the previous quarter, and showed a massive 27.3% decrease on the same period of the previous year.

Posted by uncle chris @ 01:03 PM 6 Comments

Will BTLs stick it out for the long run?

Market Oracle: UK House Prices Fall - Buy to Let Now an Unsatisfactory Investment

In light of this illustration, it is of course relevant to ask what the investment horizon of the typical buy-to-let landlord is. This is difficult to pin down accurately, but we do know that the rapid growth of the buy-to-let sector emerged after the equity bear market of 2001-2003, which impacted on confidence in traditional pension schemes. Together with evidence from recent surveys2, this suggests that many investors are motivated by longer-term retirement planning rather than the expectation of making a quick gain. If true, there are reasons to be more sanguine about buy-to-let than suggested by recent headlines.

Posted by sold 2 rent 1 @ 12:19 PM 9 Comments

Don't get too depressed

Market Oracle: US and European Economies Heading for Depression 2.0

This guy thinks we are heading for a depression. I like to think we are heading for a moment of singularity where we make a COMPLETE break from the past. Roll on 2012

Posted by sold 2 rent 1 @ 12:10 PM 3 Comments

China gearing up for bubble mania

Market Oracle: Stock Market Investment Buying Opportunity of a Lifetime!

This guy is mega bullish on Chinese stocks. With US IRs set to crash to 2pc or lower by September then will we see a US-China carry trade where people borrow heavily in USD and invest in Chinese stocks. The US banks need to lend more money. This could be the final stocks blow-off mania for the world to invest in that I reckon will peak in spring 2009. The full gold mania probably wont come until 2011

Posted by sold 2 rent 1 @ 11:59 AM 0 Comments

OK HPCrashers our chance to ask an "expert's" opinion

FT: Is it time to move back into property?

So with property prices down, is the time right to start buying again? Are we heading for a global house price recession or will there be a soft landing? Liam Bailey, head of residential research at Knight Frank, will tackle your questions on the global property market in a live debate on Monday February 4 from 2pm GMT. Mr Bailey has substantial experience across the whole residential sector, from development and private housing to investment and affordable tenures.

Posted by happyrenterz @ 11:51 AM 21 Comments

Cutting US IRs isn't working

Market Oracle: US Banking System Teetering on the Brink of Collapse

About an hour after Bernanke made the announcement that the Fed Funds rate would be cut by 50 basis points the yield on the 30-year Treasury nudged up a tenth of a percent to 4.42%. The same thing happened to the 10 year Treasury which surged from a low of 3.28% to 3.73% in less than a week. That means that mortgages which are priced off long-term government bonds---will be going up, too.

Posted by sold 2 rent 1 @ 11:35 AM 2 Comments

A rare UK focussed article

Safe Haven: Usury

"I suggest that the City Of London AND Wall Street mend their ways and fast, they are the minority and we are the majority. Major revolutions and change have always sprang from the disgruntled masses, who find themselves once again at this particular point in history lied and cheated to by the International Bankers, and their subservient lap dogs the British and American Governments. Maybe the time is rapidly approaching when we need something like our own Polish Solidarity to force real change on our own communists!"

Posted by sold 2 rent 1 @ 11:31 AM 9 Comments

Money supply to explode

Safe Haven: Housing's a Mess, But be Careful Fighting the Fed

However, this strategy has an undeniable consequence: inflation. As far as I'm concerned the Fed has made it clear they will take rates to zero if they must in order to re-inflate asset prices and thus, it has tacitly stated where you should be investing. My advice is: don't fight the Fed! Shorting the stock market will be a dangerous exercise and commodity-related investments should remain a focus for new money.

Posted by sold 2 rent 1 @ 11:23 AM 0 Comments

US IRs 2pc by September

Safe Haven: Can the Fed Stop the Recession?

The most likely path now is three or four consecutive cuts following the March meeting. This results in the Fed cutting rates to 2.25% at the August meeting, then a roughly 50% chance of one more in September to end the easing cycle at 2.0%.

Posted by sold 2 rent 1 @ 11:17 AM 4 Comments

Someone woke up and smelled the Java.

sacbee.com: William H. Gross: It's the housing market deflation

It seems to me that the U.S. economy requires a new orthodoxy, a redirection from consumption toward the stabilization of the housing market and an emphasis on infrastructure. America's economy is faltering because of an exhaustion of free-market capitalism that has mutated in recent years to something resembling a pyramid scheme. Our levered, derivative-based financial system, seemingly so ascendant after the dot-com madness that preceded it, has met its match with the subprime lending and poorly structured, opaque mortgage-backed securities of today's marketplace.

Posted by blank cheque @ 10:39 AM 2 Comments

Industry in better zhape than reported

Assetz: Buy to Let long-term sztability confirmed

This news may not be much of a revelation to those who have seen the optimistic outlooks presented by the recent surveys from Bradford and Bingley, Alliance & Leicester and ARLA, all of which have shown high levels of investor optimism. In the announcement by Nationwide of its latest monthly house price index, which showed a 0.1 per cent drop in January, senior economist Martin Gahbaur said: "We do not believe that the long-term fundamentals of buy-to-let are as poor as recent commentary suggests." It is clear the buy-to-let property market is still healthy for longstanding landlords, especially for those in the south-east.

Posted by little professor @ 10:36 AM 9 Comments

6% falls by June

The Mirror: 6% falls by June

6% falls by June says Mirror.

Posted by nmarks @ 10:17 AM 0 Comments

Media turn realist.... almost

Times: Should we revive the concept of house poor?

"the US Census Bureau defines someone who pays out more than 30 per cent of their salary in mortgage, insurance and the rest as house poor"

Posted by confused76 @ 09:33 AM 2 Comments

Monoline Crisis Jolts the Markets

The Times: Business Article

I wonder how many Times readersknow exactly how serious this is? Potentially more than Sub Prime itself!

Posted by orwell @ 08:53 AM 2 Comments

another nail..

telegraph: UK takes a gamble as tax changes look set to drive non-domiciles away

Another problem of the proposed changes is that existing overseas mortgages will become much more expensive. A fall in the top end of London house prices could be one consequence of these proposed changes because non-domiciles are going to leave. Lawyers are already advising non-domiciles to put their expensive properties on the market before prices fall.

Posted by quokka @ 03:41 AM 1 Comments

Bubble caused by Chinese printing money, not Feds

Financial Times: Buyers, not savers, caused Americas deficit

Slightly off-topic, but it's 1am and this article will have disappeared off the end of the blog by morning. "We have two competing theories of the causes of the US current account deficit and all the related imbalances created by it. Mr Greenspans explanation is that it is all the result of a savings glut and a decline in home bias in the surplus countries. The alternative explanation is that the US trade deficit has been caused by free trade with low-wage countries and financed by paper money creation by the central banks of the surplus countries. You decide which is more plausible." So the Chinese and others caused the bubble by printing money for competitive devaluations. Looks like they went too far!

Posted by drewster @ 01:30 AM 6 Comments

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