Tuesday, June 9, 2009

RICS report reveals more green shoots of recovereh

Interest in property 'up again'

The balance of surveyor reporting rises rather than falls was -44%, up from -58% last month and the strongest figure since November 2007, and up from a low of -95% this time last year.

Posted by little professor @ 12:32 AM (2376 views)
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21 thoughts on “RICS report reveals more green shoots of recovereh

  • ‘Obstacles’

    Some 11% more surveyors were now expecting property prices to fall rather than rise, the survey found. “

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  • so, basically 75% of those questioned are seeing prices falling. Yup, that’s a green shoot!

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  • Greenshootsandleaves says:

    Thanks to quiet guy and his paddypowertrainer post we now know how much credence to lend to this bit of news…
    It pretty much confirms what Mrs Hoskins in the next street said the other day (that she’d felt a twinge very much similar to the one that preceded the last property boom). Might as well close this site down, then.

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  • Its still such a deceptive and dishonest article. It relegates the bad news to the bottom of the article and still favours anecdotal evidence in the place of statistical proof, from vested interests.

    The BBC’s lack of journalistic integrity will go down in history as being one of the catalysts of the housing credit boom.

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  • phdinbubbles says:

    “The BBC’s lack of journalistic integrity will go down in history as being one of the catalysts of the housing credit boom.”

    Quite. I wanted to throw a brick at the telly whilst watching the reporting of this story on the BBC this morning.

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  • HOUSE PRICE CRASHED – POSTPONED?

    Nah, just the results of what BOE (with QE and low interest rates) and Gordon Brown (forcing the nationalised banks to start lending) have been up to over the past few months…..all with the single aim of helping Gordon Brown to win the next general election.

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  • 11% more surveyors were now expecting property prices to fall – 11% more than what?

    The Rics report actually says:

    “The net balance of surveyors expecting sales to increase rose from 35 to 40, an all-time high (October 1998). The price expectations series remains in negative territory but the -11 outturn compares with -42 in April.”

    So is that 35 surveyors? No % included. Is it “5 more surveyors expected prices to increase “?

    In March Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors said:

    “Most of the house price indices suggest prices have fallen by up to 20pc from the peak. However, many of our members [surveyors and estate agents] cast doubt on this and calculate independently that the scale of price falls has been even greater − 30pc or more already. They suspect the Nationwide and Halifax figures are underestimating scale of the peak-to-trough fall to date.

    Looking at the surveys you have to come to the conclusion that we aren’t at the bottom by any stretch yet. Our members are still expecting further falls in prices, according to our survey, and if there’s anyone you might expect to be talking up the market it is them”
    Can’t really see ANY reason for him to have changed his opinion can you other than the supply of property being at an all time low pushing prices up. RICS agrees with Nationwide and Halifax that if more property comes on the market HPC will resume.

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  • Just because the vultures are circling the carrion, it doesn’t mean the carrion will come to life again.

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  • I think we just have normal market forces effecting house prices and sales.

    House prices have gone down by approx 20% so nobody wants to sell, therefore stock is well down.
    This lack of stock has meant the market is being “cherry picked” with the best houses selling at a premium prices.

    This situation will not change significantly until forced sellers enter the market in substantial numbers.

    We have many negative forces about to affect us over the next 6 -18months;

    Unemployment 2m – 3m
    Interest rates 0.5% – 4%
    Average wage -5%
    Increased direct and indirect taxation
    Continued inflation, especially in essentials (food and utilities)

    I am sure there wil be more!

    A combination of the above will sadly bring these forced sellers to the market and it is then that I believe the real price crash will start.

    We have hard times ahead but I do believe a return to some more core values will benefit our society.

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  • Sybil13,

    If RICS say 11% more surveyors are reporting house price falls, it means that of those that expressed an opinion on the matter, and excluding those that said that prices were unchanged; 55.5% said prices were falling, and 44.5% said they were rising – net difference 11%.

    It’s not a bad way of reporting a subjective survey.

    But don’t worry boys and girls, the market is nowhere near sustainable; so further (and substantial) price falls are unavoidable.

    This little false dawn already looks to be wilting, the downward trend will soon resume.

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  • @ 8. uncle tom,

    So UT, I know you dislike gold, but where is your excess money going these days?

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  • I love the desperation in their choice of expression.
    “the rise is -44 up from -58 compared to last year’s -95”

    We need our old algebra hats from school, now let’s see . . . minus minus = plus. plus minus = minus. plus plus = plus. fog = fog. bull sh!t = bull sh!t.

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  • mark wadsworth says:

    Spring bounce.

    Between 1989 and 1995, prices rose more than they fell in the months March & April, big deal, so what?

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  • In my opinion anecdotal “evidence” from EA/surveyors = lies, lies, lies.

    Do they go to auction houses and witness 50% drops ?

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  • little professor says:

    nomad – to be fair, that was my expression, rather than a quote from RICS.

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  • Does anyone know or can point me to the *methodology* used by RICS to calculate their “buyer interest” numbers?

    It seems like such a vague notion to me and inherently difficult to capture accurately. After all, what constitutes “interest”? I’m very bearish on UK house prices but I am sitll “interested” in buying (eventually). What is a “buyer”? Do they count people who *want* to buy even if they *can’t*? Furthermore, if someone walks into an EA and expresses an “interest in buying” and then walks down the road to another EA and does the same, are they counted twice? (something tells me RICS don’t have a national database of potential buyers they can cross-reference and remove duplicates)

    It’s depressing that the media have been quoting these figures for weeks now as “evidence” that the hosing market is “recovering”.

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  • “So UT, I know you dislike gold, but where is your excess money going these days?”

    I’ve been mostly in equities for the year to date, but have recently been taking profits – some of those profits have been 100% gains, so I’m quite a happy bunny at the moment.

    I don’t like gold, mainly because there’s too much of it held by central banks that they don’t need, and might well offload. I’m wary of silver because the price looks very high – especially when you consider that industrial consumption of the metal is in decline due to alternative technologies prevailing – it is not that scarce a metal, and the market might glut.

    I have a temptation to buy into Platinum, as the motor industry will revive fairly soon, and the metal is exceedingly scarce; but with all precious metals, spreads are high, theft is a risk and there is no earning power – only capital growth.

    I need to do a bit more number crunching, but I suspect that a broad portfolio of oil stocks is a fairly safe hedge against the upsets to come.

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  • My apologies LP, I should have read the article.

    But here’s a better example from the “Cheltenham & Gloucester closure” BBC article – desperate attempt to dilute bad news.

    “Our business editor said that the announcement was “profoundly bad news” for many employees of Lloyds, saying that the group’s financial predicament meant it was “unlikely” that there would not be further significant job cuts.”

    UNLIKELY that there would NOT be further . . . Ref: 10.

    Which brings me to the question of just how many redundancies will there be in the banking industry. There are still all the HBOS branches close to Lloyds, and what about the Abby, Alliance & Leicester and Bradford and Bingley branches together on the High Streets all over the country. Thousands of jobs to go, and soon because Santander have announced a rebranding programme.

    Furthermore, are bank employees still on soft mortgages which will have to change as they lose their jobs?

    wdbeast @ 7. I’m with you – HPC barely under way.

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  • ontheotherhand says:

    Bank of England Deputy Governor Paul Tucker cautioned today that the U.K. economy’s outlook may remain “unclear” until the third quarter.

    “Confidence seems to have stabilized,” Tucker said in a speech in London today. “But a sense of perspective is needed” and “it is unclear — as I must say it is bound to be at this stage — whether the financial system can generate the expansion of credit that will most likely be necessary to support recovery,” he said.

    Quite.

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  • At Glasgow Central this morning waiting for a train, the news was continuously displayed on a giant screen there. It feels like a concerted effort to get people believing the lie that HPI is back, so relax, charge that double chocca-mocca-soya- latte with a twist to the card and stop worrying. Quite nauseating to see really given the facts of the situation. Does anyone still believe the hype I wonder?

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  • I agree with AJ, the rough estimate for house price drops for the last year has been about 15%, in my are of west london (probably the toughest nut to crack) prices started to fall then stalled again. The crash should last about 2-3 years at least, if it happened any faster then that in itself would be worrying, it would mean that the whole system could be manipulated too easily, as it is, even with all this upward pressure, prices are falling nicely. Unemployment is going to be a real problem, I know people that have been directly affected by this, and it doesn’t look good, even know a couple that planned on buying, then both of them were made redundant. This is a very slow process, and anyway I seem to remember a post on here that showed similar VI house price ramping in the early 90’s all the way down to the bottom, so get used to it, but don’t let it wind you up.

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