Friday, January 2, 2009

Just keeps going down

Fresh low for mortgage approvals

Mortgage approvals fell in November to their lowest level since records began, the Bank of England has said. Approvals totalled 27,000, compared with a downwardly revised 31,000 in October. It was the lowest figure since the series began in January 1999.

Posted by little professor @ 09:45 AM (756 views)
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3 thoughts on “Just keeps going down

  • dohousescrashinthewoods says:

    Isn’t this one of a series of record lows? Seems we are plumbing new depths pretty much every month, but then, weren’t we hitting new highs every month during Flush Gordon’s Boom?

    Consider that in the last crash there were never more than 2-3 months of price falls without an intervening uptick (as someone pointed out a while back). That makes the current crash unprecedented in its speed, ferocity and single-mindedly downward trend.

    Why is this? No one knows, but food for thought:
    – Market information: the internet has speeded up reaction-time (if so a recovery would come sooner than expected)
    – Sentiment: Brits have become more ill-informed and more emotionally driven, so overreact both up and down (history suggests we always have, so this is probably no more than Daily Mail windbagging)
    – Sheer scale: the size and longevity of the credit bubble set up an unprecedented bust (ie we’re just getting started and recovery will come later than expected)

    The latter assumes we haven’t crossed a point of no return and that recovery of the current system is still possible, in which case all bets are off (and probably betting too). I feel sure the dollar is long-past and, if the pound isn’t already, then the weakness of an economy built on houses and “financial masters of the pig-pen” will pull the point of no return inwards, putting us outside the recovery zone.

    I guess it’s a case of will this be “bad hangover” or “alcohol poisoning” – and, if the latter, can the stomach pump still save us?

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  • The downwardly revised bit has been edited out. Downwardly revised by how much?

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  • Northern Bear says:

    Interesting comments dohouses..

    I thought I may be alone in thinking that this current bust will not have a recovery. Who is to say that we are not the witnesses of the very highest house prices ever to be recorded in the UK? It may be that – barring short upward bursts – house prices will continue to decline in much the same way as they rose during the last century.

    The drivers of the housing market are confidence, credit, healthy employment market and rising incomes. All these things have peaked.

    The engines of growth which lifted this country out of the last two big slumps – the Great Depression and the slump of the 1970’s – were in the first case manufacturing (electrical goods and motor cars) and in the second case the de-regulation of the financial markets (and look where that got us).

    Can anyone see what is going to get us out of this current mess?

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