Monday, April 6, 2009

Plenty more of the HPC to go

Beware talk of recovery as the world economy is not a picture of health

Best bit of this from Roger Bootle: "The old joke about stockmarkets having forecast 10 of the last four recoveries remains apposite. And we've already seen at least three false stockmarket recoveries in the last year or so. True, this was the first up month for Nationwide house prices for 17 months. Even so, this does not assuredly mark the end of the slide. In the 1990s downturn, during the housing market's 74-month long downward trend from May 1989 to July 1995, there were 22 months in which house prices rose month on month. That's a rise roughly once every three months. Indeed, house prices rose in four consecutive months between July 1993 and October 1993, leaving them 2.4pc higher in October than they had been in June. But the downward trend then continued for another 21 months."

Posted by growler @ 11:57 AM (1416 views)
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6 thoughts on “Plenty more of the HPC to go

  • Naïve sellers and increasingly redundant ‘property experts’ are desperately grasping at any sign of a blip in the downward trend but it does seem to have been forgotten that the downwards curve is rarely straight.

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  • shipbuilder says:

    People will hear what they want to hear and never learn until it is too late. I think this is the reason why we always see the crash start to flatten out and sales increase. Some people believe the hype, think they see the bottom and jump in – it will slow things, but it is never enough to stop the inevitable.

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  • shipbuilder says:

    “Indeed, house prices rose in four consecutive months between July 1993 and October 1993, leaving them 2.4pc higher in October than they had been in June. But the downward trend then continued for another 21 months.”

    That’s a scary statistic. Surely even the most hardened bears would be tempted to jump back in after 4 months of rising prices?

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  • @shipbuilder

    I don’t think we’re going to see that for sometime this time round. The rate of fall is the steepest in history. As you say the government can temporarily make the parachute bigger, but the trend is still firmly downwards.

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  • As we acknowledge, the market is in steep decline.

    But, I’ve noticed Chancellor Alistair Darling has several properties. So have most MPs. I therefore think that house prices will be levered UP.

    I don’t think that the government has pulled every trick to prevent further falls, there must be a few more!

    One thing I’m certain of….. MPs will always vote their own interests first.

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  • happy mondays says:

    Beware talk of recovery as the world economy is not a picture of health ..

    No Sh*t Sherlock!

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