Thursday, December 31, 2009

All is well in the uk

House prices rise by 5.9% in 2009, says Nationwide

there is no obvious catalyst on the near-term horizon that would trigger significant renewed falls in prices, such as a sharp spike in interest rates."

Posted by matt_the_hat @ 09:12 AM (1589 views)
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31 thoughts on “All is well in the uk

  • All is well in the uk

    I think you’ll find that it isn’t.

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  • Do Nationwide normally mention volume? I couldn’t see anything in a brief look through this press release.

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  • It pains me to say this, but I agree with the comment below the article title. There is currently nothing to trigger a further fall in house prices, not until there are forced sales. If banks etc. ohld onto repossessed property and interest rates stay low, then almost everyone can pay their mortgages with ease. Enen if they lost there jobs they woudl get support!

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  • Is this happening abroad as well?

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  • QE has done this I think. Comparing the UK banks’ situation to Spains’, we see that Spanish banks have had to offload their repossessed properties and bad property debts by selling them back into the market, but UK banks have been spared this because of the free money the Bank of England has been printing.

    How much longer can sterling holders be forced by the Bank of England to keep UK banks from selling off their bad property debts? I think the bond market is about to send a strong signal to the BoE where to get off.

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  • What does this tell you about the British people?

    Gullible, apathetic, No sense of self, crazy,TV drones, Need to be led, Soft, Roll over attitude, Weak minded, the list is endless, but as long as the public can still consume & keep spending,& house prises continue to rise ! Happy days…

    Now i’m no finacial whizz kid, but the sums don’t add up & the government can only play god for the short term, me thinks…

    Happy new year….

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  • “Is this happening abroad as well?”

    No. US, Spain, Ireland – house prices down 40 to 50%.

    The US have also kept IR low so why have house prices suffered a much more pronounced drop there?

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  • I think we are being deliberately lied to. Trawling through properties in Plymouth on Property Bee, all i can see is price REDUCTIONS for the past 2 years.Can`t believe its that much different in other parts except for London.

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  • c'mon correction says:

    As the rest of the world’s real economies start to recover, central banks will start raising rates (Australia already have). We will then see how the un-sustainable public-sector-led-on-the-back-of-government-borrowing-private-sector-in-decline-public-maxed-out-on-debt-based UK economy will fare.

    The UK’s real troubles won’t even start until after the election/ global recovery really begins.

    My 2010 UK house price prediction – +8% for the first eight months, -4% for the last 4 months so full year +4%
    Followed by 2011 – 15% down
    2012 – 10% down
    2013 – 5% down
    2014 to 2020 – flat

    With higher inflation taking the total fall in real terms from 2007 to 45% – 50% down.

    In the mean-time it’ll still be a lot cheaper to rent, and will get even cheaper as mortgage rates rise from here. So I’m staying put, saving, not worrying about debt and will buy in 2013 or 2014!!!!

    Happy New Year HPCer’s – Don’t lose your bottle, you know, they know, everyone knows UK property is 40%+ over-valued!

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  • hear hear!

    and a happy new year

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  • Hear, hear indeed!

    I think economics history textbooks will be justly unkind to the decade we have seen. Let’s hope the next decade is a better one.

    Happy new year everyone.

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  • There is currently nothing to trigger a further fall in house prices, not until there are forced sales.

    They will come, despite the fact the government are throwing laws at preventing it.

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  • From the Take That song book.

    Have a little . . . patience.

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  • Nomad @8. Many thanks.

    So what will foreign sentiment be towards the UK? Will it be;

    “I am going to invest my money tin UK because the Government are actively supporting asset prices” and cash starts rolling in and prices rise – or

    “Those **stard Brits they cannot be allowed to get away with this etc” and apply policies to make life extra difficult for UK

    I’m just not understanding why unemployment is rising, incomes are being frozen or reduced, prices of food is heading north, Sterling is heading south yet house prices seem to be in their own bubble….rising….??!!

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  • 14. tom101 said… house prices seem to be in their own bubble….rising….??!!

    price without volume is the wrong price

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  • Nationwide 2009 House Price Index without the seasonal dressing:

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  • “price without volume is the wrong price”

    We seem to forget this every time the hpi is mentioned.

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  • Phd, not too disimilar to the ftse chart.

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  • 2010 – Labour loses election. Peter Mandelson severs all ties with New Labour and reality.
    2011 – New laws passed outlawing home repossessions, poverty and mercury fillings. Pound and US dollar become worthless
    2012 – Most countries pull out of Olympic games so venue used for celebrity ‘it’s a knockout’. Euro becomes worthless.
    2013 – All fiat currencies become worthless. Average house price in UK is now 200 oz gold
    2014 to 2020 – Large Hadron Collider discovers strange new sub atomic particle which is utilised to make gold from fresh air. Gold becomes worthless. Average house price is 50 barrels of crude oil or 500 10kg bags of basmati rice.

    Seriously though, c’mon correction’s predictions sound plausible and I hope they’re right. I am in danger of losing faith!

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  • Here’s the annualised HPI this year on a 3 month moving-average (month 3= average of Feb to Apr, month 11= average of Oct to Dec).

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  • Back to my 8. Does anyone have any insight as to why, with continued ultra low IR, US house prices have crashed while over here they have not?

    Could it simply be the old time lag because we always follow the Americans, only 12 to eighteen months later?

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  • nomad – take a look at the video inks attached to mine of yesterday. The simple or the more detailed. your choice. see : http://www.housepricecrash.co.uk/newsblog/2009/12/blog-printing-money-always-creates-inflationor-does-it-27079.php

    the first video should do it.

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  • techie, glad you reposted that, i missed yesterdays, ta.

    Is there a personality difference eg brits more stubbornly determined, yanks more flexible?

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  • sorry rumble and sorry nomad – 24 should say sorry nomad – its an update to mine of 22 where i was refering to the wrong vid!!!

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  • @ Nomad

    US consumers generally buy houses on 30 year fixed rate mortgages, so the interest rates in question there are long term bond yields which have not fallen as dramatically as short term rates (i.e. the Fed rate). In the UK most people are generally borrowing linked to short-term rates, so the what the BoE does with the base rate is a lot more influencial.

    The flip side of this of course is that the UK borrower will feel a lot more pain when / if the BoE raises the base rate…

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  • Nomad,

    In the US home owners generally have the option of handing over the keys and walking away from the debt. And if they are in negative equity (or ‘upside down’ as they call it) why wouldn’t they ? The bank then has to sell the house for whatever it can get. It ain’t the same sport over here.

    The only surprise really is that more people don’t just walk away. Here is an article on that very subject –

    http://money.cnn.com/galleries/2009/real_estate/0903/gallery.walking_away/index.html

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  • Hi LJ – the video i posted at 24 says exactly that! –

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  • Hi Techieman,

    Sorry, it was the title that threw me.

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  • Techieman, luckyjim, garch thanks for those illuminating comments.

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