Thursday, January 7, 2010

+1.0% MoM +1.1% YoY

December Index

Commenting, Martin Ellis, housing economist, said: "House prices increased for the sixth consecutive month in December. The 1.0% rise between November and December was slightly below the average increase over the previous five months. Prices increased for the second successive quarter following falls in both the first two quarters of 2009. Prices in December were 1.1% higher on an annual basis, marking the first rise since March 2008. House prices have risen by 9.4% since reaching a low in April 2009."

Posted by phdinbubbles @ 09:06 AM (5248 views)
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26 thoughts on “+1.0% MoM +1.1% YoY

  • tyrellcorporation says:

    Housing market is utterly dead in Exeter. The expected rush to market houses after Christmas just hasnt happened and certain houses have been on the market for well over a year with no interest from buyers. A stalemate that will see hundreds of EAs go to the wall over the next 12 months IMO.

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  • Approvals remain 53% below their late 2006 peak.

    Price without volume = the wrong price.

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  • I wonder what the non-seasonally adjusted change was. Does anyone know if they publish the raw data / a fuller set of data anywhere?

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  • fallingbuzzard says:

    Mortgage offers without completion = Garbage

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  • In the report, the “national average earnings for full-time male employees” used to calculate the average earning ratio is £36k.

    Where on earth do they get that from?

    The “Annual Survey of Hours and Earnings (ASHE)”

    £36k, Not where I live (South Midlands) it’s not!

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  • Since we like rising price so much in this country the average man on the street will be pleased to know that oil is up to $81 a barrel and Sterling is now down to $1.5950. Not long now before petrol is at the same price it was when oil was $145 a barrel. Do you see the problem here folks?

    Traditionally news like this would cause Sterling to strengthen, but over the past 6 or so months the housing data has caused the reverse. The country has no credibility in the world anymore and nobody with any sense is buying into this rising house price bull

    I’m not saying the data is false, but what I am saying is the data and our situation are just not marrying up. We are painting ourselves into a corner from which we will be unable to stage a true recovery from. For a new spurt of growth to happen prices needed to come down so the next generation can get involved and bring fresh money to the table, this now cannot happen because prices are still out of reach.

    Brown may well have saved the housing market, but he’s fooked the entire economy in doing so. All we need now is a hung parliament, the loss of our Triple A and a full blown Sterling crisis. Sadly all three are looking like a very real possibility.

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  • @ tyrellcorp – yeah, according to “badmove”, 24 new instructions in the last 7 days to serve a population of 115K ish….shocking! But is it? I live here too and we are on the move again after rented accommodation sold in December…plenty to rent though. Have to agree about agents – far too many in Exeter. Last time around (1990) Exeter saw one of the highest increase in values and was the last up and the last down but boy, prices fell by +35%!! Prices desperately out of kilter with local earnings and whilst Exeter is a lovely city, it aint that special!! We sold to rent about a year ago and “Mrs Magnaman” is driving me a bit mad about buying again. We went to look at a 3 bed house in Wyvern Park yesterday. Supposedly “detached” but really “linked”. Built by C G Fry who are very good. House was tiny. I mean, bedroom 3 was shocking – room for a single bed and a chest of drawers and no room for the cat! Did some research before viewing, as you do. Vendor bought in 2007 for £320k – peak time. Now asking….wait for it…..£345,000! prices in Exeter have, even if you include the “rises” last year, fallen by at least 12%. Said to the agent that realisticly the house was worth £290K max….he agreed!! Turns out the asking price was set by the vendor! Said to him “whats the point?”, and he shrugged his shoulders and raised his eyebrows….I suspect there will be some nasty surprises coming from local and public sector employers very soon and prices in Exeter will start to tumble as buyers retreat and delusional sellers get a dose of realism….heres hoping!

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  • extend and pretend

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  • brickormortis says:

    Looked at arsemove recently and noted that in Oxfordshire the site is littered with sold STC ads. I then looked in poor old Shropshire region and nowhere near as many. More like 1 in ten comapred to one in 5. So what is happening. Well if this pattern continues, those with money appear to be putting into B & M and those that don’t have money can’t do anything so we have the rough north south divide problem more roughly, haves and have nots. One group buying more and more and the other group stuck!

    I guess the average is being pushed up by more expensive houses down south cause in my area they certainly are not rising.

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  • tyrellcorporation says:

    Interesting stuff Magna.

    I wonder how much longer EAs can accept vendors dictating dellusional pricing. If I was an EA in that sitatution I’d walk away from the vendor as months of marketing an incorrectly priced property is foolhardy to say the least. When the Council finally get going on the 5000 house Cranfield development I think cracks will start to appear in the average prices in and around Exeter. The council have basically encouraged loads of governenment departments to move to the area without supplying any extra housing (permits) or infrastructure. All a ploy IMO to massively boost the value of their own homes – if I were devious, that’s what I’d do!

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  • Brown may well have saved the housing market,

    Only for a short period of time though. I fail to see – in the longer term – what is going to keep them up.

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  • “I fail to see – in the longer term – what is going to keep them up.”

    Well, this month it was low interest rates, last month it was foreign investors, month before that it was bank of mum and dad, month before that it was cash buyers, next month it will be supply and demand fundamentals, month after that it will be ummm…good weather, month after that it will be something else, supply and demand fundamentals again possibly or foreign buyers or something…etc

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  • bricomortis: I see lots of STC boards too. But look at the stats behind the STC boards. Some of these boards are so old, there’s woodworm in the stakes. There is no law to prevent ancient STC boards from popping up around the place to give the impression of market movement. Look at the houseprices site and then compare the dates…. tells a story!

    As far as pricing is concerned, in South Bucks which I’m based, I regularly see houses advertised at £575/595 but checking house prices shows well under 500 agreed – from 575 to 460 for example. The amount of housing on offer at £500 – £550 has all but gone as the bottom is sucked away from house prices. Soon the house of cards (no, not the collective name for Estate Agents 😉 but it has a certain ring to it) will come down.

    I maintain that huge chuunks of buyers have gone. Not because you don’t want to trade up, but because you can’t as you’d never have got the mortgage you’re enjoyiong at the present time let alone the new one. FTBs that live with hopefully wiser parents are likely to be advised to hold fire.

    Job movers, foreign speculators and the ignorant are the market today -> and this group can’t grow to support a prolonged price boom of the sort Subprimevocation and Wrongmove would like to see.

    The next move will be a supply side increase – and our impending belt-tightening and smaller wage packets will further reduce mortgage offers.

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  • mark wadsworth says:

    @ Magnaman, good anecdotal.

    I was advised on this here ‘blog to keep Mrs W’s nesting instinct at bay by simply buying her more stuff. To be honest, even if I shell out £2,000 a year on handbags and shoes and flowers and other such nonsense, that’s a price worth paying to stave off the fateful day when we buy again. Maybe that would work for Mrs Magnaman as well?

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  • it_is_going_with_a_bang says:

    Brown has not saved anything – especially the housing market.
    Just put off the inevitable to buy himself some time and using tax payers money to do it.

    The market has been porpped up by low rates for quite a while now – not just last month.
    But that will not last forever. The point being that any rising of prices now will simply make it worse when the rates do go up.

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  • @ mark 13 – Did spoil her a bit at Christmas as you do but, though I loath to agree, you’re right! On ebay as we speak!….well, it’s the thought that counts….bit of a giveaway when the postman arrives bearing a box with shoddy packaging – she just knows I’ve been on Ebay!!

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  • 14. it_is_going_with_a_bang said… “Brown has not saved anything – especially the housing market.”

    Stop it, this is Gordon Brown we are talking about, the worlds statesman of 2009, the man who saved the world.

    Are you telling me houses are now going to fall? How can that be? We are recovering, surely houses cannot fall in a recovery, especially not in a country whose main economic activity is house flipping?

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  • mark wadsworth says:

    @ Magna 15, £185 for a House of Fraser handbag was my contribution to staving off the house price recovery.

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  • I don’t see anything in the near term that, of its own accord, will house prices moving either way.

    The bulls are hoping that the recent upbeat news on the economy – employment, orders, trading, outlook – gains momentum. I don’t think there’s anything wrong with that. From a personal view point, having been made redundant last year, I truly hope this pans out. And if improved outlook or confidence has the effect of sustaining property prices, then tough to those hoping for a fall. For anyone who has experienced redundancy (or even short working) , it’s certainly not something to enthuse about. Anyone out there short-sighted enough to wish for further downturn needs to adjust their thinking (or perhaps enduring the degrdaing experience of attending a job centre for a few months).

    While I genuinely feel for those who say they are unable to buy, I ask myself (1) is there a god given right or expectation to own property and (2) are these people looking at aspirational properties or simply somewhere decent to live. In the case of the former, I do not think there is but, more importantly, I think the recent boom has brainwashed (frightened?) people into believing they are incomplete without home ownership.

    For those who do not wish for economic armageddon, interest rate rises seem to be the great panacea for house prices coming down. I don’t recall interest rate falls causing the surge in house prices and, as we live in a world of what we now call ‘historically’ low interest rates, I don’t see huge rises on the cards (circa 80s/90s). In fact, I see historically low rates causing us to re-adjust our view on what is ‘reasonable value’ i.e. shifting closer to affordability than pure earnings.

    If I had to place a bet, I’d call a period of stagnation. In my humble, layman opinion.

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  • cat and canary says:

    wdbeast, yeah, garbage isn’t it! You got me wondering about that figure of 4.7…

    An average price of £169,042 in Dec 2009, with a price to earnings ratio of 4.70 gives an average salary of £35,966.38!)…as you spotted. The Halifax report says “Price Earnings ratios revised to reflect new data in the Annual Survey of Hours and Earnings (ASHE)…using male employees”

    ….But the ONS’s latest ASHE median average weekly earnings for men (full time) are actually £531. Or a salary of £27,612! (Apr 2009 data). …….. http://www.statistics.gov.uk/pdfdir/ashe1109.pdf

    A price to earnings ratio of 6.1 for men who work full time!

    Note that the median average for all employees, men and women is £489 mean or £397 median (ratios of 6.6 and 8.2, resepectively).

    8.2!!!!

    There is only one salary figure, in the entire ASHE report which gives a price-earnings ratio of 4.712, and that is for full-time men, working in London (not even men in the south east/west). This piece of data was buried on page 9 of the ASHE report.

    Bit of fiddling of figures by the Halifax.

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  • It depends on what a recovery means. At present very cheap borrowing is helping maintain prices, just as it pushed them up in the first place. As Stephen King said in that recent survey, when activity picks up, interest rates will rise and prices fall. If, on the other hand, activity does not pick up and interest rates stay low, house prices will fall anyway as we gradually sink. For prices to stay high indefinitely you have to imagine some means of avoiding these two alternatives. I can’t think of any, at least none that are at all probable.

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  • phdinbubbles says:

    Time for another chart:

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  • @18 “But the ONS’s latest ASHE median average weekly earnings for men (full time) are actually £531. Or a salary of £27,612! (Apr 2009 data). …….. http://www.statistics.gov.uk/pdfdir/ashe1109.pdf

    Exactly!!! It’s about time people made a bit more of these discrepancies since these figures are used in a lot of affordability arguments.

    Also, I don’t really see how they can get away with still just using male earnings in this day and age.

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  • According to Peter Collis the head of the Land Registry, following the collapse of the property market (his words not mine) he was having to make tough decisions involving an office closure programme and a ‘large number’ of job cuts. The workload had ‘fallen off a cliff’ and was down about 75%, he is not expecting a recovery in work load for some time, possibly not until 2017.

    Does this sound like ‘green shoots’ or a turnaround????

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  • cat and canary says:

    Becky, “Also, I don’t really see how they can get away with still just using male earnings in this day and age.” …how cheap of the Halifax! they “conveniently” chose males from London when working out their afforability chart!

    Not only that, since the ASHE data (apr 2009) a huge number of men have been losing their full time jobs, and women have been going out to work part time to support the family in tought times (presumably), as shown in the last ONS employment report.

    So the “price-to-earnings” ratio of 4.7 is way way off, its somewhere between 7 – 8, IMO.

    This data by Halifax is at best misleading, at worst down-right deceptive

    As of late the amount of “disinformation” and “hyperbole” propagated through the media is staggering

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  • Why are the house prices not being updated now they are rising? Pathetic

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