December 2010 Archive

Thursday, December 30, 2010

Roundup of predictions for 2011 - place your bets now

FT.com: Slight falls forecast for UK house prices

The consensus of forecasts for house prices suggests that the average house will lose 4% in value over the course of 2011. RICS: -2%, Capital Economics:-10%, Knight Frank -6%, Savills -3%, Carter Jonas -5%, Hamptons -4%. No mention of poor Stuart Lawzzz and his comedy club.

Posted by little professor @ 11:51 PM 4 Comments

Turning Japanese

Telegraph: Bank of England can hold UK rates low 'for ages'

Bootle acknowledges that inflation has been above target for a while but speculates that, at least until the end of 2011, the MPC will hold off raising rates by which time Bootle suggests that inflation will probably ease off so no rate rises! Also, if the economy weakens, more QE is the only weapon left as a policy response so more QE is quite possible as well.

Posted by quiet guy @ 10:02 PM 11 Comments

Hooray! Ray of sunshine in dark tunnel in US! Oh, wait, that's a train...

National Association of Realtors (via Bloomberg): Pending Sales of U.S. Existing Homes Rose 3.5% in November

Cheerful piece by the National Association of Realtors say that you need a haircut. In other news, the National Association of Hairdressers say pending house sales have leaped 3.5%...hang on, I think I've mixed these up somewhere. Pending sales jumped 10% in October 2010, and are up another 3.5% in November. However, they are still 2.4% down on where they were at this time in 2009. Not-so-seasonal cheer in the US, then. Unless you're on HPC! Happy New Year!

Posted by notyethomeless @ 08:47 PM 0 Comments

Home Prices Are Still Too High

Peter Schiff on house prices: Wall Street Journal

HPC favourite Peter Schiff gets an op-ed slot on the Wall Street journal to predict a double-dip in US housing. Personally I think he's a pompous a$$hat, but he's popular around these parts.

Posted by little professor @ 07:00 PM 5 Comments

Slipping quietly under the radar

Daily Mail (online): House prices set to plummet by up to 10% in 2011, experts predict

House prices will fall next year, the vast majority of economists canvassed for a poll are predicting. Fifty of the 56 who took part expect that prices, which have been dropping in recent months, will continue their downward path. Most did not expect a crash but think a fall of five to ten per cent is likely, according to the survey by the Financial Times.

Posted by jack c @ 03:42 PM 11 Comments

US Housing Enters Double Dip, S&P Say

New York Magazine: The Housing Market May Already Be in a Double Dip

S&P index committee chair David Blitzer told the Journal. "Somebody who thought last year that it's going to be straight up from here was wrong."

Posted by 51ck-6-51x @ 03:25 PM 1 Comments

Complacency is lowest I have personally ever seen

Masdaq.com: Sweet stockmarket lullaby followed by rude awakening

looks to me like this is just a huge bear market rally.In times of severe tension and worry, the stockmarket tends to trade at conservative levels...i.e 6-9 x earnings....we are currently around 13-15 forward earnings.Place your bets but even ben bernanke tried to tell us this are going really badly....scary stuff

Posted by taffee @ 01:25 PM 16 Comments

November falls

Land Registry: House Price Index

Index 264.2 Average price £164,773 Monthly change -0.6% Annual change 2.2%

Posted by dill @ 11:02 AM 21 Comments

U.K. Home Prices to Drop in 2011 on Loans, Budget Cuts

Bloomberg: U.K. Home Prices to Drop in 2011 on Loans, Budget Cuts

U.K. home prices will fall next year, extending a decline that began in the third quarter, as mortgage restrictions and government spending cuts discourage buyers, a Bloomberg News survey showed.

Posted by karma4all @ 09:58 AM 2 Comments

Your move, punk.

Houseladder: Repossessions may rise if interest rates go up in 2011

"However, Mr Holmes explained he does not think interest rates will rise for a while yet, as the Monetary Policy Committee (MPC) knows that doing so could be damaging. And the MPC also have to consider the impact an increase would have in terms of international markets, as they would not want to have to operate in a degree of isolation, he remarked."

Posted by sibley's b'stard child @ 09:17 AM 3 Comments

You see those doom-bringing Nationwide & Halifax indices? Fear not; you can ignore them...

Guardian: House prices surveys: who publishes what and when

Strange really; on the way up, no-one really seems to care about the data integrity of the various indices. In its defence, the CML does dismiss Rightmove's index (for obvious reasons). However, it holds up the Acadametrics index as one of the most reliable. Phew, had I owned a home i'd be grateful that my house is obviously worth more than those pesky Nationwide/Halifax people would lead me to believe. Hurrah.

Posted by sibley's b'stard child @ 09:15 AM 0 Comments

Wednesday, December 29, 2010

Borrowing costs rise again

Telegraph: Italy's debt costs approach red zone

"Italy's borrowing costs jumped to the highest level since the financial crisis over two years ago, raising concerns that Europe's biggest debtor may slip from the eurozone's stable core into the high-risk group on the periphery". "Yields on 10-year bonds rose 10 basis points to 4.86pc after a poor auction of short-term debt in Rome. The Italian treasury had to pay 1.7pc to sell €8.5bn (£7.2bn) of six-month bills in a thin post-Christmas market, up from 1.48pc a month ago"."Italy avoided the sort of property bubble seen in Spain or Ireland and has kept a rein on public spending under finance minister Tremonti. But, the rise in yields looks ominously like the pattern seen in Greece, Ireland, Portugal and Spain when they first began to lose easy access to the capital markets".

Posted by alan @ 10:46 PM 2 Comments

Negative YoY tracking down nicely

Hometrack: House price growth (% year on year)

Gathering pace... ramming speed for 2011. HNY, HPC.

Posted by doomwatch @ 09:27 PM 2 Comments

Lone voice of MPC

Daily mail: Savers set for New Year boost as Bank of England hints at interest rate rais

Higher interest rates are needed to boost savers’ paltry incomes and keep rising inflation under control, a leading Bank of England economist said yesterday

Posted by waitingtobuy @ 08:53 PM 12 Comments

Battening the hatches

Telegraph: Homeowners cut mortgage debt by the most in over a year

"British homeowner cut the outstanding mortgage debt by £6.1bn in the three months to the end of September, encouraged by record low interest rates and fears of tough times ahead ... Earlier in the decade many people extended their mortgages to finance other spending, such on cars, holidays and extensions. This trend that came to an abrupt end in 2007 as the global economy was gripped by the worst recession since the Depression era." I think this might have some implications for HPC. If mortgage borrowers have used ZIRP to pay off debt, then they should have some room for absorbing higher interest rates i.e. modest rate rises won't be enough for a crash.

Posted by quiet guy @ 11:55 AM 18 Comments

Aussie house prices 63 per cent overvalued

The Australian: Australia's property market strength set to fade in 2011

THE AUSTRALIAN property market has been one of the strongest in the world in 2010, according to a new study, but is predicted to slow into 2011 under the weight of higher interest rates.

Posted by mallows @ 10:20 AM 1 Comments

The US banking problems are over - right?

Washington Post: 2010 worst year for bank failures since 1992

"More banks failed in the United States this year than in any year since 1992, during the savings-and-loan crisis, according to the Federal Deposit Insurance Corp". "The loans that brought them down were predominantly commercial loans, Hernandez said, which sets them apart from the banking giants whose problems were rooted in home mortgages".

Posted by alan @ 10:17 AM 0 Comments

Financial Times asks economists: prices up or down? Response: down

FT.com: House price declines forecast to continue

Fight the paywall, or read my summary: Austerity measures and mortgage restrictions will continue to weigh against house prices, with only 6 of 56 economists polled expecting prices to rise in 2011. However, in absence of forcing factors [read: higher interest rates or mass unemployment] there will not be a crash. Prices are likely to fall most significantly for 3-bed semi's outside of London, as the public sector cuts bit.

Posted by notyethomeless @ 10:00 AM 4 Comments

Tuesday, December 28, 2010

Assuming it ever genuinely stopped dipping, it's clearly on the dip again

Zero Hedge: Roubini: US Housing is in a double dip

Roubini has just bought a $5.5m house, so has arguably no reason to talk down the market. The latest Case Schiller index showed house prices down over the month and year, in raw and also seasonally adjusted figures. Roubini points out that it is likely to get worse in 2011. I can see why he might be called Dr Doom.

Posted by notyethomeless @ 11:54 PM 4 Comments

Haircut anyone?

Wall Street Journal: Europe crosses the Rubicon

Merkel and Sarko celebrate xmas

Posted by chrisch @ 03:35 PM 7 Comments

Mervyn King 'apologises' for stoking a credit boom all those years

Daily Mail: Families warned by Bank of England of even more painful year ahead

That August 2005 interest rate cut to re-stoke the housing market (when inflation was rising) looks really foolish now. Really, really stupid.

Posted by paul @ 12:15 PM 14 Comments

UK house prices to finally crash in 2011

ArabianMoney: 2011 the year that UK house prices finally fall

Prices that defy the forces of economic gravity do not stay high forever. UK house prices must fall into this category as outrageously high if judged by historic income multiples and the bleak economic outlook. Why have they stayed so high? The first rumbles of the financial crisis came in August 2007, more than three years ago. UK house prices dropped 10-20 per cent and then rallied back almost to their previous peak. For chartists that is a classic double-top and usually forewarns of a big correction back to price levels seen much earlier in the cycle.

Posted by david smith @ 06:33 AM 0 Comments

Here we go, another house price downswing

Clouded Outlook: Four reasons to think the UK property market might be weakening

Four charts pointing to a weakening UK housing market.....

Posted by inflationwatch @ 03:23 AM 0 Comments

Monday, December 27, 2010

He had 13 years to do it

Guardian: £180m cut from regeneration plans for Tony Blair's flagship housing project

The Aylesbury estate, a vast, crumbling complex of flats in south-east London became a shorthand for Labour's grand plans on urban regeneration. Fast forward 13 years and the estate finds itself in an entirely different political climate. With the first few dozen residents preparing to leave their flats for new, sustainably-built homes the rest of the redevelopment is suddenly in jeopardy after more than £180m of central government funding was withdrawn without notice. The £180m would have directly financed the construction of just 350 of the eventual 4,200 new homes replacing brutalist concrete towers and walkways. However, the knock-on effect threatens another 570 properties being financed in part through borrowing raised on increased land values generated by earlier redevelopment.

Posted by drewster @ 08:08 PM 13 Comments

The new stagflation: prices of essentials rise while wages stagnate

BBC News: Pay freeze or cut for many in 2011, says BCC

More than half of UK companies plan to freeze or cut their employees' pay in 2011, according to a survey by the British Chambers of Commerce (BCC). While 45% of firms surveyed said they would give their staff a pay rise, 49% said they would freeze salaries, while 6% said they planned to reduce wages. A BCC spokesman said the response showed companies were taking a "pragmatic approach to pay settlements in a tough environment".

Posted by drewster @ 08:01 PM 5 Comments

Roger Bootle reasserts his position as a "Mega Bear"

Telegraph: Expect two more years of house price pain

Telegraph columnist Roger Bootle tells Robert Miller why house prices could continue to fall for another two years. (Video)

Posted by jack c @ 06:27 PM 9 Comments

Headline is some what misleading.

This is Money: Will your home sell in 2011?

Vested interested parties forecasting house prices in 2011. They fail to discuss the mortgage drought and possible rises in interest rates. The article also fails to answer it's title question.

Posted by will @ 10:24 AM 9 Comments

The US... leading the world?

Telegraph: Lehman 'prophet' fears second crisis if US interest rates are kept low

"America is storing up a second financial crisis by keeping interest rates at record low levels, according to David Einhorn, the hedge fund manager who first publicly warned about the financial catastrophe facing Lehman Brothers". "The crisis that required zero interest rates has passed," said Mr Einhorn". "Those in favour of very low interest rates point to the support it has given the real estate market in the US and that, as in the UK, it should encourage politicians to begin to tackle the $1.3 trillion budget deficit without fear of damaging the economy".

Posted by alan @ 08:52 AM 1 Comments

Hometrack: -0.4%MoM, -1.6% YoY

Bloomberg: UK December Home Prices Fall for Sixth Month

U.K. house prices fell for a sixth month in December and will extend their decline in 2011 on “weak” demand and tighter mortgage-lending conditions, Hometrack Ltd. said. The Hometrack report also showed sellers had to wait the longest since April 2009 to shift their properties in December and adds to forecasts for a weaker housing market in 2011.

Posted by little professor @ 12:42 AM 2 Comments

Sunday, December 26, 2010

Goodbye N&P

Mail: Beleaguered N&P in takeover talks as Coventry may bid for building society

"A tie-up would create Britain's third-biggest mutual, with assets of more than £23 billion. A number of building societies have merged to increase the amount of capital behind them. Without access to public equity markets, they have struggled to rebuild their reserves after the credit crunch"." N&P faces a substantial fine from the Financial Services Authority for the mis-selling of risky Keydata bonds".

Posted by alan @ 10:15 AM 2 Comments

Express turning more bearish

Express: UK HOUSE PRICES SET TO PLUNGE NEXT YEAR

HOUSE prices could fall by up to 7 per cent in 2011, economists believe. Howard Archer, chief UK economist at IHS Global Insight said: “While we do not expect house prices to crash, we do expect them to gradually lose about 10 per cent from their peak 2010 levels by the end of 2011. This implies that house prices are likely to fall by a further 6 to 7 per cent during 2011.” The gradual slide in prices is likely to be confirmed on December 31, when the Nationwide is expected to report that house prices fell by a further 0.5 per cent

Posted by little professor @ 01:08 AM 16 Comments

Come on Boys & Girls, save the economy with money you haven't got!

The Independent: Spend! Spend! Spend! Nine days to save economy

Looks like the independent is pushing the old 'weather' and 'jittery' punters line, I for one have an every increasing round of utility bills, static income and the prospect of higher mortgage payments and tax take so like many others will not be venturing a single foot through the door of the UK's false economy over the next week.

Posted by enuii @ 12:28 AM 6 Comments

Saturday, December 25, 2010

China raises rates to near 6% on xmas day!

Reuters: China raises rates at christmas

looks like hiding bad news then.I really feel that china is gonna implode....its construction market is almost certainly going to collapse. The problem imo is that I believe that many loans have been packaged and sold to world banks as AAA.Think cronas hedge fund manager is right,china is the next disaster waiting to happen

Posted by taffee @ 03:00 PM 9 Comments

Last Chance to Buy At These Prices?

Taylor Wimpey: Unique Opportunity

Roll up folks, last few remaining units left. Looks like "off plan" is getting a bit 2005 these days...

Posted by crash bandicoot @ 01:34 PM 1 Comments

This video is so true.

Merry Xmas: Something to make you smile this xmas

A nice video to sum up the lack of social housing, cuts, failing schools and hospitals under the Tories, Labour and Lib Dems

Posted by khards @ 10:01 AM 0 Comments

Friday, December 24, 2010

When TV interviews go wrong … Irishman gives eloquent explanation of banking crisis

Planet Property: Planet Property

Irishman gives eloquent explanation of banking crisis

Posted by theplanet @ 01:15 PM 0 Comments

Interest Rates Up, Utility Bills UP and Wages Down - 2011 will see House Prices Fall Significantly

Office of National Statistics: Annual Survey of Hours and Earnings (ASHE) - 2010 Results

Puzzled by some of the statistics quoted in the media I have taken some time out this morning to have a dig, the interesting charts are Table 4 and Table 13 and their associated xls files. The data hunt was sparked by the misleading way statistics have been quoted in the media especially with regard to the ONS Annual Survey of Income. Table 13 shows public sector pay up 3.8% yoy whilst the private sector is 0.6% the big winners are female public sector at +5.2%, with some significant drops across a wide spectrum of occupations in the private sector with the ladies being the losers at +0.2%.

Posted by enuii @ 11:59 AM 5 Comments

Spend your lottery win on BTL

BBC News: What to do when you become an instant millionaire

Thought that this was an interesting example of the "you can't lose by investing in property" mindset that we see all over the media. That said, if anyone knows where these flats are she talks about with a 12% yield, please let me know! Ms Thompson-Wells says "For what it's worth if I was in the UK and came into a £1m next week, I would go out and buy four £120,000 one-bedroom flats or properties in London or somewhere like Hertfordshire or Berkshire. "That could bring in up to about £4,500 in rent a month. Whether that's something you could retire on is up to you," she says.

Posted by neil @ 11:16 AM 15 Comments

Is that a rhetorical question?

BBC News: Will house prices fall or rise in 2011?

Expert commentators are divided about whether house prices will fall further, stabilise or even rise during the coming 12 months. In 2010 the property market took a turn, and a brief recovery in prices that had started in 2009 ran out of steam.

Posted by amadeus @ 10:16 AM 1 Comments

More bear nibbles for Xmas Eve

Metro e-edition: Mortgage rates 'are sure to soar'

"Home owners must prepare for a series of rises which will see the Bank of England base rate becomen ten times higher than it is now, an official warned yesterday. They should expect the rate to become 'normalised'; at five per cent, said Paul Fisher who is on the bank's rate-setting comittee. However, he said that how quickly the rate went up again 'was another thing entirely'. He added: 'We would push rates up, see what the effect is and then judge how quickly to go'"

Posted by mark wadsworth @ 10:15 AM 8 Comments

Stock market shenanigans

Telegraph: FTSE 100 hits 6,000 in last gasp Santa rally

"A return of around 15pc, which would see the FTSE touch 6,900, is likely for 2011 – although like 2010 the ride will be bumpy," he said. "It should be noted that even at 6,900 the FTSE will still be below the all time high of 6950.6 on December 31, 1999."

Posted by sibley's b'stard child @ 09:47 AM 13 Comments

But I thought it would be 0.5% forever?

Guardian: Variable mortgage customers exposed to interest rate rises

Just a rehash of the Telegraph article posted by Flashman. Still, good to see the message getting put out there.

Posted by sibley's b'stard child @ 09:40 AM 16 Comments

Extolling the virtues of living beyond our means - hurrah!

Guardian: Britain's big spenders come close to top of EU league

"Figures released by Eurostat showed that while income per head in Britain is 12% above the EU average, consumption per head is 25% higher....Separate figures released today suggested that equity withdrawal from homes rising in value – a traditional source of spending power for consumers – was unlikely to feature in household budgets for the immediate future."

Posted by sibley's b'stard child @ 09:32 AM 3 Comments

Thursday, December 23, 2010

Bleeding to death propping up banks - Who next?

SKY: Fourth Irish Bank To Pass Into State Control

"Allied Irish Banks ran into trouble when the Irish property market collapsed, due to the size of its exposure to failed real estate developments". Despite selling off overseas assets to strengthen its balance sheet, it was unable to keep on top of its losses on bad loans.

Posted by alan @ 09:07 PM 10 Comments

What will effect house prices next year.

Housing Expert: Pros and cons next year!

Great summary of what will move house prices next year by BBC talking head Henry Pryor who explains what will drive prices up - or down! A summary of the predictions from some of the usual suspects plus his own which may surprise.

Posted by charles lister @ 08:02 PM 0 Comments

From Xmas 2 years ago - but cartoons haven't aged at all!.

The Guardian (2008): Cartoon Christmas cards by Kipper Williams

Cartoonist Kipper Williams has created eight topical Christmas cards

Posted by rental john @ 05:44 PM 3 Comments

House prices to rent around 50% over historical average

Investment and Business News: Are house prices 50 per cent too expensive?

The recent Bank of England financial stability report presents a chart showing how the ratio of UK house prices to rent is around 50% over the average since 1970. Holiday bulls says it’s not price it's affordability that matters, and so if interest rates are low then it matters not if prices are high. But, if more people are to rent and less buy, then surely it's the affordability of rent that matters. For the ratio of price to rent to return to average either rents must rise or house prices fall. I think that in the current environment it is inconceivable that rents can rise.

Posted by mike @ 01:46 PM 7 Comments

Christmas jobs misery for public sector workers

BBC News: Christmas jobs misery for public sector workers

Thousands of public sector workers have begun receiving grim news about their jobs - just days before Christmas. The GMB union says "at risk" warning letters are hitting doormats around the UK as councils and other services serve legal notice of cuts. It says workers face a miserable Christmas, with 87,374 posts under threat so far at 107 UK councils. Local authorities have until 31 March to start making savings and by law have to give staff 90 days' notice.Earlier this month the latest jobless figures for the UK showed a 35,000 increase to 2.5 million in the three months to October.

Posted by cat and canary @ 12:23 PM 25 Comments

To be honest, i've given up caring what the MPC do...

Citywire: Interest Rates: next year we'll find out what Mervyn King and the MPC are about

"Homeowners beware Bank base rates didn’t move in 2010. Homeowners beware: 2011 shouldn’t be so dull. After nine letters to the chancellor explaining why inflation (which has averaged almost 3% over the last two years) has overshot the Monetary Policy Committee’s 2% target by more than a percentage point on nine different occasions, governor Mervyn King can’t blame City commentators for wondering whether the MPC has been working to a different, secret target."

Posted by sibley's b'stard child @ 11:31 AM 1 Comments

London Property Leads World as Rising Rents Lure Money

Bloomberg: London Property Leads World as Rising Rents Lure Money

London’s commercial property market has probably drawn the most investment for the second consecutive year as prospects of rising rental income attract cash from as far afield as Hong Kong, Qatar and Canada. The gains have been mainly limited to the capital, RCA data show. Elsewhere in Britain, concern about the impact of government spending cuts to reduce the national debt has held back property investment. Perhaps no suprise here, in general commercial property took it on the chin & trophy properties will retain their appeal amongst the tier that need to park large amounts of capital.

Posted by karma4all @ 11:26 AM 3 Comments

Interest rates to be set by market forces (at last!)

Daily Mail: Interest rates will hit 5%, warns Bank of England: Families face £202-a-month rise in mortgage costs

Families should brace themselves for a huge increase in interest rates to ‘normalised’ levels of around 5 per cent, a senior Bank of England official warned last night. Paul Fisher (part of the MPC) said the Bank is looking to increase rates tenfold from their current low of 0.5 per cent. It seems the BOE has decided not to use further QE to generate more cheap money. So this is good news for savers and will almost certainly cause a bigger HPC.

Posted by miken @ 11:26 AM 7 Comments

Nice X-Mas Present!

BBC News: Mortgage lending at 20-month low

The number of mortgages approved for house purchases by the major UK banks fell to a 20-month low in November, figures have shown.

Posted by peter rocker @ 10:33 AM 4 Comments

Couldn't happen to a nicer bunch.

Estate Agent Today: Local council sets up its own estate agency

"A council in Wales has set up its own residential estate agency, thought to be the first time that a local authority has done so. Property Bay Wales, launched by Neath Port Talbot Council, attempts to undercut other local agents by charging a fixed fee of £899."

Posted by sibley's b'stard child @ 10:21 AM 13 Comments

A festive rib-tickler for Jack C

Houseladder: More mortgages 'will be approved'

In fairness, the VI doesn't make the school-boy gaff/gaffe (Alan) of specifying actual figures. So even if approvals increase by just one; technically she'd be correct. Still, good for a laugh.

Posted by sibley's b'stard child @ 09:38 AM 2 Comments

Homeowners should prepare for interest rates of 5pc, warns Bank of England markets chief Paul Fisher

Telegraph: Homeowners should prepare for 5pc interest rates

Homeowners should start preparing for interest rate rises ahead of a return to “normalised” levels of around 5pc, a senior Bank of England official has warned. Mr Fisher’s warning follows a stark Bank research paper indicating that more than 7m homeowners are at risk of rate rises. Two thirds of mortgage borrowers are currently on variable rates, it found, compared with roughly half in a typical year. On current wages, if rates were at 5pc, households would be spending more of their disposable income on debt interest than at any time in the past 20 years.

Posted by micasasucasa @ 07:45 AM 25 Comments

Road to recovery might not be covered in Tarmac

BBC News: Tarmac Building Products to cut 550 jobs

West Midlands-based firm Tarmac Building Products Ltd is to cut 550 jobs and close one of its divisions due to "tough market conditions".

Posted by neilp6777 @ 05:21 AM 0 Comments

Wednesday, December 22, 2010

Flu jab uptake 'shockingly low'

ITN: Flu jab uptake 'shockingly low'

The results of this during the harsh winter should help give a bit of an extra boost to downwards house price momentum by the spring.

Posted by general congreve @ 11:04 PM 13 Comments

The Tip of a Very Big Iceberg

BBC News: Apprentice contestant Christopher Farrell admits fraud

A former contestant on BBC's The Apprentice altered mortgage applications to boost his monthly earnings, a court has heard. Mortgage broker Christopher Farrell, 29, inflated clients' incomes to help them secure home loans - and earn himself commission.

Posted by wdbeast @ 05:02 PM 12 Comments

Get ready for more volatility in government bonds

The Economist: Behold 2011, the year of sovereign shocks

If you want to know what to worry about in 2011, here’s a place to start. Sovereign-bond yields are rising—not just in beleaguered economies on the edge of the euro zone, but across much of the rich world.

Posted by rental john @ 03:59 PM 0 Comments

Why attacking the financial sector costs us

Telegraph: Record £10bn drop in UK exports blamed on 'banker bashing'

Sorry for drifting from topic a bit but I think this is interesting. We have rightly pinned some of the blame for the house price boom on dumb bankers recklessly expanding mortgage credit but the recent slump in GDP shows that banking is important to our national wealth. So what are we going to do with the financial industry to stop it exposing us all to more risks in the future without 'killing the goose that lays golden eggs?'

Posted by quiet guy @ 03:25 PM 10 Comments

S&P 500 – 25% to go to all-time peak

Investment Postcards: S&P 500 Index – 25% to go to all-time peak

The S&P 500 Index yesterday advanced for the 13th time in 15 sessions, reaching a two-year high – a level last seen before the collapse of Lehman Brothers in September 2008.

Posted by prieur du plessis @ 03:18 PM 0 Comments

Even the CML are serving up Bear Food!

24 Dash: UK mortgage lending 'to slip to lowest level since 1980' - CML

The net lending forecast of £6 billion will be familiar to most of us, but what is surprising is the "since 1980" comparison. Further: "The figure is a far cry from the £110 billion that net lending reached in 2006, before the credit crunch struck, but more worryingly, it represents a 33% reduction on the £9 billion that the CML estimates net lending reached this year, suggesting mortgage availability will become more restricted during 2011. In fact, if the CML's prediction comes true, 2011 would be the worst year for the mortgage market in terms of growth since 1968."

Posted by mark wadsworth @ 02:17 PM 4 Comments

Eye of the storm! more pain to come

Telegraph: Citigroup fears fresh wave of sovereign defaults and bank failures in eurozone

Mark Schofield, Citigroup’s global head of interest rate strategy, said Portugal will need an EU rescue soon and that it is "highly likely that Spain will go the same way". This risks over-powering the €440bn bail-out fund

Posted by happy mondays @ 01:42 PM 3 Comments

Fun Online Poll by the least Home-Owner-Ist newpspaper

Guardian: Poll: What will happen to house prices in 2011?

Currenrly standing at: Yes, the worst is over for the market - 18.5% No, there'll be more bad news to come - 81.5% Let's see if we can get that closer to 90% for more bad news {sic].

Posted by mark wadsworth @ 11:59 AM 25 Comments

Bear's Christmas feast

Mail Online: Grim forecast for house prices in 2011 - but lack of homes on the market will stop huge slide

House prices look set to tumble next year but a shortage of homes on the market should prevent a total collapse in value. Property values are likely to fall by 2 per cent during the coming months but the lack of supply should help to stabilise the market at some point during the first half of next year, the Royal Institution of Chartered Surveyors said. Prices could then begin edging up again during the latter part of the year, to leave property values close to where they started the year by the end of 2011.

Posted by jack c @ 10:52 AM 8 Comments

Bear Food - another rehash of that RICS press release

City AM: House prices to decline in 2011

"HOUSE prices will fall by two per cent next year, the Royal Institution of Chartered Surveyors (RICS) said today. While house prices are projected to slip, a drop in supply to the market will stop prices tumbling further, it said. And transactions are unlikely to pick up, with little more than 900,000 expected to take place in 2011. Yet “repossessions will decline marginally,” and London and the south east will “continue to outperform” the rest of the UK, the report said." A two per cent decline is exactly my break even point - provided house prices fall by two per cent a year (even assuming no increase in interest rates), then I am better off staying in cash and renting. As it happens, price falls will by far more than that, end of decision making process.

Posted by mark wadsworth @ 10:37 AM 5 Comments

To recovery and beyond!

Guardian: TUC survey says new year outlook is bleak for unemployed

"Almost a quarter of a million people will be spending their second or even third Christmas on the dole this year, according to a survey by the TUC. More than a third of the 232 local authorities across the UK now have more than 1,000 residents who have been claiming jobseeker's allowance (JSA) for at least 12 months. This compares with just 26 in December 2007."

Posted by sibley's b'stard child @ 09:53 AM 0 Comments

2% a month, I presume?

Guardian: Ailing housing market will see prices fall by 2% next year, says RICS

"The Royal Institution of Chartered Surveyors said the number of transactions would remain flat at about 900,000 in 2011 amid continued constraints on the availability of mortgages. It added that a lack of supply of new houses coming onto the market would prevent steeper falls in prices unless the government's cuts in public spending had a greater impact on unemployment."

Posted by sibley's b'stard child @ 09:50 AM 17 Comments

Express in bear news shocker

Express: HOUSE PRICES TO DROP 5% IN FIRST HALF OF 2011

ONLY a shortage of homes for sale can prevent a huge slide in house prices next year, say experts. Prices have fallen two per cent over this year and the Royal Institution of Chartered Surveyors predicts that next year will be see a fall of about five per cent in the first six months, followed by a modest recovery to the kind of levels seen at the beginning of 2011. Simon Rubinsohn, RICS chief economist, said: “The narrowing gap between supply and demand will see the gentle downward trend in prices currently taking place at least partly reversed as the year wears on.”

Posted by little professor @ 01:03 AM 13 Comments

Tuesday, December 21, 2010

Citigroup demand more tax payers money

Daily Telegraph: Citigroup warn of fresh wave of bank failures

Citigroup today warned that more banks will fail. Guess they want more of our money for their bonus! Suspect they will argue that governments have loaded up on debt (by taking from the banks) and that they now cannot afford to pay it back thereby causing a fire sale which will make more Citigroup loans go bank. See its all the tax mans fault. Nothing to do with bankers and their excessive pay,

Posted by who stole my pension? @ 10:17 PM 11 Comments

26 Per Cent Down YOY

Independant: Mortgage Lending Falls

Total mortgage advances fell by 5 per cent to £11.1bn during November, according to the Council of Mortgage Lenders. Lending during November was also 10 per cent down on the £12.3bn that was advanced in the same month of 2009.

Posted by crash n burn @ 03:26 PM 0 Comments

Are we still in recession

Telegraph: Tax Revenues Near 20 year low

Are GDP figures being generated by the ONS reflective of what is going on in the economy. While we sit 4.5% below GDP peak, recent GDP growth (driven by stimulus and deficit spending) is being regarded by the main stream as self sustaining. This seems unlikely where we remain in a (household) balance sheet recession. Little has really changed since 2008/9 and matters are possibly worse. The consumer remains compromised by (a) patchy employment prospects - see recent stats (b) wage compression esp relative to the cost of imported items (esp commodities) (c) declining house prices looking set to accelerate and (d) a reduced capacity and appetite for credit. Certainly tax revenues relative to GDP dropping 3 years straight suggest an economy weaker than GDP figures alone indicate.

Posted by bellwether @ 02:37 PM 2 Comments

Should you buy a property to protect against inflation?

MoneyWeek: Should you buy a property to protect against inflation?

Inflation is ticking up. The traditional hedge against inflation is to buy 'real' assets – including property. So is now a good time to get back into the property market?

Posted by damien @ 12:04 PM 42 Comments

Bear Food

BBC: UK home sales down in November, HMRC says

UK home sales fell in November as the property market showed little sign of fresh life at the end of the year. There were 77,000 residential properties sold for more than £40,000 in the UK in November, according to HM Revenue and Customs (HMRC). This was down from a revised figure of 80,000 the previous month and some 6,000 fewer sales than in the same month a year earlier. A lack of demand from first-time buyers has pushed down sales and prices.

Posted by mark wadsworth @ 10:50 AM 8 Comments

It doesn't look good.

Independent: UK slumps further into the red with record borrowing

Britain slumped into the red by a higher-than-expected £23.3 billion in November - the highest monthly borrowing figure since records began, official figures revealed today. The figure, which excludes financial interventions by the Government, was a marked increase on the £17.4 billion a year earlier and beat the previous highest monthly borrowing record of £21.1 billion in December 2009, according to the Office for National Statistics (ONS). Total public borrowing for the year to date now stands at £104.4 billion, the ONS said, creeping closer to the Government's target of £149 billion for the financial year. Economists were braced for a rise in the year-on-year level of public borrowing in November but none predicted a figure so high.

Posted by sibley's b'stard child @ 10:37 AM 15 Comments

Flight of the savers

Telegraph: Savers spurn banks for Zopa-style 'peer-to-peer' lenders

Peer-to-peer lending websites and old-style credit unions have been major beneficiaries of public anger against the banks, seeing a huge level of growth in 2010. A spokesman for the main peer-to-peer lending site, Zopa, said customers were attracted by “bypassing bankers, their bonuses and the poor rates caused by their excessive profits”.

Posted by sibley's b'stard child @ 09:49 AM 11 Comments

Usual confusion between Asking Prices and Initial Asking Prices

Lovemoney: Revealed: What happened to house prices in 2010

2010 is unlikely to be remembered as a vintage year for the housing market. However, despite its troubles, it was still a year that saw a significant increase in property values in the UK. (according to the author 2.5% is significant)

Posted by essexman @ 09:47 AM 0 Comments

Monday, December 20, 2010

We could all move to Scotland!

BBC: Rise in numbers of vacant homes in Scotland

"The number of empty homes in Scotland has risen to its highest level since 2003, according to a survey by the Bank of Scotland.Its latest vacant property report records 106,239 properties in September 2009 compared with 106,312 in 2003".

Posted by alan @ 10:39 PM 17 Comments

Will this cause IRs to rise in the US?

Guardian: $2tn debt crisis threatens to bring down 100 US cities

"Overdrawn American cities could face financial collapse in 2011, defaulting on hundreds of billions of dollars of borrowings and derailing the US economic recovery". "Meredith Whitney, the US research analyst who correctly predicted the global credit crunch, described local and state debt as the biggest problem facing the US economy, and one that could derail its recovery"."California has raised state university tuition fees by 32%. Arizona has sold its state capitol and supreme court buildings to investors, and leases them back...". (clue: look at 10 year loan rates).

Posted by alan @ 10:34 PM 5 Comments

More bearfood

Telegraph / Yahoo: Interest rates 'will have to rise sixfold in two years'

Interest rates will have to rise almost sixfold over the next two years to cope with rising inflation, business leaders have warned.

Posted by mr g @ 06:37 PM 18 Comments

RICS UK Housing market survey

RICS: Housing market slows further

Activity in the housing market continued to slow during November, with house prices slipping further, according to the latest RICS UK Housing Market survey.

Posted by p. doff @ 04:13 PM 2 Comments

More good news

BBC News: Cold weather hits major retailers' shares

Shares in major retailers have been hit after the severe weather stopped many shoppers from reaching the High Street on what is usually one of the busiest weekends of the year.

Posted by neilp2000 @ 03:47 PM 0 Comments

What Bootle says: Inflation is high because the BoE guessed wrongly

Telegraph: High inflation is a cock-up not a conspiracy

Regular discussion in the comments here about inflating our way out of debt. I think it's less obvious: not only does our Government not really benefit if inflation is high (the interest they have to pay on Gilts is higher, and many of our countries expenses are index-linked) but the Bank of England has probably just decided that any action against inflation would more likely result in larger downside risks (big bust) than the small downside risk of (noticably, but not terribly) higher than intended inflation. nb. Hyperinflation is a completely different beast, indicating loss in confidence in money.

Posted by notyethomeless @ 02:58 PM 10 Comments

Monopoly money

FT: Monopoly with the FT: Candy Brothers

Not sure what the point of this article is : "We meet in the living room of their £60m apartment at the One Hyde Park development in Knightsbridge, due to be launched next month."

Posted by doomwatch @ 02:31 PM 3 Comments

Weaknesses in mortgage market: volumes and total lent both down

FT.com: Please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited extracts. Email ftsales.support@ft.com to buy additional rights or use this link to reference the article - http://ww

As per a recent calculation I saw in one of the HPC comments, there are far fewer mortgages being approved, and the total amount loaned is way down. Given the high price of the average house, the figures add up. All based on CML data; nothing particularly surprising. We went to see 2 houses for sale at the weekend. Neither suitable (whew!). I guess I'm being contrarian...? Note: registration for the Financial Times website might be required.

Posted by notyethomeless @ 02:19 PM 2 Comments

The biggest bubble of the century is about to burst

The progress Report: The Peak of the Welfare State Bubble

The fatal flaw in the welfare state is that it preserved the privileges of the landed interests and means we must tax and borrow.

Posted by the number cruncher @ 01:38 PM 4 Comments

House Prices indices are as easy to interpret as giving candy to children or not

Estate Agent Today website: Your user-friendly guide to the RICS house price survey

Three children and their pet dog, Acadametrics, go into a sweet shop. Tom wants Lovehearts, Laura wants chocolate drops and Richard wants some humbugs. Acadametrics, who has mild learning difficulties through inter-breeding which is blamed on the Land Registry, likes fudge...

Posted by rantnrave @ 12:47 PM 3 Comments

Bear Food

Telegraph: House prices to 'drop 7pc' next year

"House prices will drop 7 per cent next year, economists predict, as the freeze on mortgages continues." Splendid play on words, eh?

Posted by mark wadsworth @ 12:46 PM 6 Comments

Persimmon's chief exec cautiously optimistic.

City AM: The UK’s largest housebuilder says the road to recovery will be long

Farley remembers exactly where he was when he realised his industry had hit its biggest slump in a generation. “It was 10am at the start of week 14 in 2008,” he says. At the time, he was sitting at his desk on Monday morning, reading the weekly sales figures as he always does. But this time it was hard to believe what he was seeing. “Sales had fallen off a cliff,” he recalls. “They were down 30 to 40 per cent. I had never seen that sort of decline before. Normally sales fluctuate a few percentage points week on week. Also, when you do see a fall, it is centred on a particular region for whatever reason. But this was right across the board. Banks had run out of cash and had simply stopped lending.”

Posted by sibley's b'stard child @ 12:24 PM 3 Comments

King Canute estate agency insists the tide is in their favour

Guardian: Property professionals defy data to remain 'confident'

Have a laugh at the headline then read these choice quotes: "Bank of England reports today that mortgage approvals for house purchases from the major banks totalled 45,000 in November. This was down 26.2% from 61,000 in November last year" "Viewed with a longer-term perspective, last month's figures point to serious problems in the housing market." "Anyone who finds these figures enough to boost their confidence might be advised to lay off the Christmas sherry."

Posted by letthemfall @ 11:17 AM 4 Comments

Confederation of British Industry predicts today in its latest economic forecast

THIS IS MONEY: Rate rise 'to put £200 a month on mortgages'

Families are facing a rise of more than £200 a month in their mortgage bills after Britain's leading business organisation warned interest rates are about to go up. Rates will have to rise in the new year to control inflation, the Confederation of British Industry predicts today in its latest economic forecast. This will add thousands a year to mortgage bills for millions of households.

Posted by rob @ 09:33 AM 0 Comments

The start of the end?

Bloomberg: BOE Forecast to Raise Interest Rate Within Six Months, CBI Says

The Bank of England will start raising interest rates within six months to curb inflation, the Confederation of British Industry said. The Monetary Policy Committee will increase its benchmark interest rate by a quarter-point every three months from the second quarter of 2011 until mid-2012, the London-based group said in a report today. It will then step up the pace of increases to end that year with a rate of 2.75 percent.

Posted by rob @ 09:30 AM 0 Comments

Maybe?

The mail: Millions of households facing hike in interest rates that will put £200 a month on home loans

Cash-strapped families are ­facing a rise of more than £200 a month in their mortgage bills after Britain’s leading business organisation warned interest rates are about to go up. Read more: http://www.dailymail.co.uk/news/article-1340058/Millions-households-facing-hike-rates-200-month-home-loans.html#ixzz18cyepz6P

Posted by happy mondays @ 05:42 AM 29 Comments

Young and Homeless in LA

UK Bubble: Homeless in California

Here is an interview with a 23 year old homeless man in California. It is tough to watch. Currently, there are 1.6 million homeless people in America. The majority are there because of economic factors.

Posted by inflationwatch @ 04:21 AM 0 Comments

Sunday, December 19, 2010

Where Ireland stands, Britain follows?

BBC Radio 4: Ireland's Toxic Tiger

The dramatic decline of the Celtic tiger into a wet pussy. How much will British taxpayers suffer from the fallout in Ireland? British banks such as RBS and Lloyds have large debts in the Republic, and are making decisions about which to call in, threatening more pain for local communities. Morland Sanders hears protests from small contractors in Donegal where Ulster Bank want to sell off a prestige residential development at rock bottom prices. This amid questions about the part British institutions actually played in fuelling the property market bubble.

Posted by gone-to-colombia @ 09:47 PM 0 Comments

Time to buy Pwopertee?

Telegraph: Ireland's UK property empire unwinds as it sells London assets

"The unwinding of Irish assets is set to be a key topic for the property market in 2011 and beyond".

Posted by alan @ 09:20 PM 1 Comments

Year of the estate agent

Daily Mail: The ghost towns of China: Amazing satellite images

What a real property bubble looks like.

Posted by icarus @ 11:57 AM 5 Comments

US-based companies offering repo-bargains in less glamorous locations

Citywire: House price decline reignites Brits' zeal for property abroad

Has Brits' enthusiasm for a place in the sun been reignited? Linton Chiswick questions whether there are really bargains to be had in places like France, Spain and the US. Putting aside regional variation, UK property prices appear to be on the slide as the year draws to an end. And with lending likely to remain constrained into 2011, unemployment on the rise and an imminent VAT increase that will help bolster inflation (and add to pressure to raise interest rates), the outlook for UK residential property is unlikely to promise much in the way of capital gains. But what about prospects abroad?

Posted by jack c @ 11:23 AM 3 Comments

Shelter "homeowners with mortgages are hanging on by the skin of their teeth"

Guardian: Shelter warns that rate rises will trigger more home repossessions

Fears that rising inflation will trigger interest rate hikes have prompted one of Britain's biggest housing charities to warn that 2011 will see a rise in the number of people being made homeless. According to Shelter, a repossession order on someone's home is being made every two minutes. But figures to be released this week are expected to show the number of orders are increasing, causing concern that rises in the cost of borrowing will trigger a new wave of homelessness.

Posted by jack c @ 11:08 AM 23 Comments

OECD says residential property may yield top tax dividend

FTAdviser.com: OECD owner-occupier tax is unwelcome

UK mortgage payers could be landed with higher taxes, if an Organisation for Economic Co-operation and Development report is ratified by the UK government. In another blow for UK consumers, a report from the OECD said that residential property was one of the best areas for governments to raise taxes as part of fiscal consolidation. The 156 -page report, called Choosing a Broad-Base Low-Rate Approach to Taxation, argued that such a levy is more efficient, more stable, harder to evade than other taxes, progressive and could prevent housing bubbles.

Posted by jack c @ 11:00 AM 3 Comments

Saturday, December 18, 2010

From Robert Preston's blog

BBC News: Preston's Picks: How to curb bonuses

The Bank of England has provided the Treasury and Business Department with both an argument and a tool for curbing bank bonuses. It takes the form of Chart 5.9 on page 51 of the Bank of England's latest Financial Stability Review, which has the unprepossessing title "Estimated size of total implicit funding subsidy to UK banks and building societies split by size".

Posted by nathan @ 09:10 PM 14 Comments

Bank culprits to be Wikileaked?

CNBC: Intent to leak on banks!

There has been a lot of discussion on banks and the housing bubble and also their role in the recession on both sides of the Atlantic. BOA has just blocked Wikileaks transactions. Assange also claims to have been attacked by banks. People are getting nervous. Assange fears for his life (I wouldn't be surprised if a drone goes off course in Afghanistan and ends up in Norfolk...all by accident)!

Posted by alan @ 06:51 PM 4 Comments

Mind the Gap!

Washington's Blog: Extreme Inequality Helped Cause Both the Great Depression and the Current Economic Crisis

America has one of the largest wealth gaps among advanced economies. Based on an inequality measure known as the Gini coefficient, the United States ranks on a par with developing countries such as Ivory Coast, Jamaica and Malaysia, according to the CIA World Factbook.

Posted by novice pete @ 04:00 PM 10 Comments

Alistair Darling wants another stress test

Guardian: Lloyds Banking Group admits £4.3bn of losses on Irish loans

Eurozone problems caused by irresponsible "Anglo Saxon" lending? "The extent of Lloyds' problems in Ireland were laid bare as it admitted 90% of the £5bn or so of loans it granted to property developers in Ireland were "impaired" – or unlikely to be repaid. Of the £6bn it lent for property investment, 54% is impaired. After this £11bn of commercial real estate loans, the rest of its £26.7bn of loans in Ireland are split evenly between corporate customers and retail customers. Much of that retail lending is likely to be mortgages, which could cause yet more problems in the future."

Posted by mken @ 12:01 PM 3 Comments

Oil prices set to move higher, watch Russia

Investment Postcards: Oil prices set to move higher

Reflecting improved global growth, crude oil prices have increased strongly since the summer and further gains are to be expected. Also, higher oil augers well for the Russian stock market.

Posted by prieur du plessis @ 10:46 AM 0 Comments

Friday, December 17, 2010

Bearfest for a Friday afternoon

Money Week: Where are Britain's house prices heading now?

This is too good not to post...

Posted by rantnrave @ 02:32 PM 16 Comments

LLOYDS warns on ireland how long UK?

Reuters: Lloyds warns on ireland

lloyds has 28% mortgage share in the uk,personally I believe this will potentially bring the bank to its knees,particularly as it declined to enter the asset protection scheme CAME IN AT 13.00 TODAY

Posted by taffee @ 02:03 PM 0 Comments

Why the finance sector is behind the depression

Real News Network: Why government is more afraid of deficts than depression

Michael Hudson argues that the 'parasite' (the finance sector) is willing to oversee a depression in western economies as long as it can find new hosts elsewhere.

Posted by icarus @ 12:57 PM 17 Comments

Link from previous article

Telegraph: MPC's Adam Posen tells Bank of England not to 'overreact' to high inflation

"As much as we may be tempted to demonstrate to the public or to markets how upset we are about being above target, we have to take the right lesson from our mistakes and try to forecast better in future." He urged his colleagues against tightening policy in response to the "inherently" temporary effects of VAT rising to 20pc next month. Mr Posen's comments appear particularly targeted at his colleague Andrew Sentance, who has repeatedly voted for interest rate rises to rein in inflation and avoid the need for nasty increases further down the line.

Posted by sibley's b'stard child @ 12:52 PM 6 Comments

LIBOR premium over base

This is money: Libor rate latest

Actually the link is : http://www.thisismoney.co.uk/libor but that is a duplicate [moneyweek use the same URL and then update it. The latest update is @ 2 days ago, but the article also compares and contrasts LIBOR with base: "Editor's commentary: The important three-month sterling Libor rose again - up 0.00062% - to 0.75% on Wednesday, 15 December - the highest level since August 2009. It has risen from a low of 0.72109% in late August, with confidence between banks being tested in November and December by the Irish debt crisis..... A gap of more than 20 points, which now exists on three-month sterling Libor, is at the top-end of what existed in pre-credit crunch days. March futures [now] are at 9915 [implies .85% for 3 month LIBOR for March delivery] So not much to get excited about...

Posted by techieman @ 12:52 PM 3 Comments

Interest Rates ?? Rise or Not.

Telegraph: Bank of England under pressure to raise interest rates after inflation expectations hit two-year high

Inflation expectations have hit their highest level in more than two years, heaping fresh pressure on the Bank of England to raise interest rates. Questions about the Bank's handling of inflation have led some senior City figures to question publicly whether the Bank has changed its target a suggestion the central bank vehemently denies.

Posted by house @ 12:38 PM 9 Comments

Yeah, right.

BBC: UK home rental costs at new high, letting agents say

"The average monthly cost of renting a home rose again in November, to a record £692, according to the LSL property index... The survey also found that arrears had risen, with 9.7% of all rents unpaid... Rents had now risen for 10 months in a row, LSL said. However, it said November's rise was mainly due to strong demand for rented property in London, where rents had increased by 1.8% last month. Elsewhere they were now falling - down by 3.1% in eastern England and 2.4% in the East Midlands during November alone. They also dropped by 1.9% in the south-east of England and by 0.6% in the north-west of England."

Posted by mark wadsworth @ 11:38 AM 19 Comments

"UK banks sitting very precariously the BoE has warned"

Citywire: Bank warns of 1994-style crisis for bonds

The tension in the bond market has increased on a warning from the Bank of England that the asset class could be facing a crisis similar to the one it endured in 1994. In its Financial Stability Report the Bank said bond yields are 'susceptible to a sudden reversal' which would have a severe impact on the earning for UK banks.It fears the combination of a sovereign debt contagion and accelerating inflation will mount a twin assault on bonds.

Posted by jack c @ 11:12 AM 6 Comments

The FSA grows a pair.

Independent: FSA hits Scottish Equitable with £63m bill for failing customers

Scottish Equitable, the UK arm of Dutch insurer Aegon, was yesterday handed a Christmas to forget by the Financial Services Authority (FSA) which hit the company with a £2.8m fine and ordered it to pay £60m in redress to customers for "causing significant consumer detriment" through sloppy administration.

Posted by sibley's b'stard child @ 10:20 AM 2 Comments

BoE thinks UK houses are overpriced!

BBC: UK banks 'at risk from financial woes in the eurozone'

' "House price to rent ratios in several countries, in particular Ireland, Spain and the United Kingdom, remain well above historical averages," noted the bank.'

Posted by phdinbubbles @ 09:57 AM 4 Comments

Stop press: City spivs kill Christmas

Guardian: Investment bankers blamed for driving up the price of turkeys

Paul Kelly, the poultry industry's "turkey man of the year", blames them for driving up the cost of wheat-based animal feed from £95 per tonne to £177. "My contacts in the City tell me the price of wheat is soaring because of financial speculation," he said. "It's not good for farmers or consumers. What is happening is fundamentally wrong and obscene."

Posted by sibley's b'stard child @ 09:27 AM 22 Comments

A warning from the BOE

The Telegraph: Home owners threatened by rising interest rates

"Currently, around two thirds of outstanding mortgages in the United Kingdom have floating interest rates"

Posted by flashman @ 08:55 AM 13 Comments

Thursday, December 16, 2010

Default on Greece's €110bn EU/IMF-sponsored package is inevitable

Guardian: Greece can only recover if its debt is restructured, say economists

"Nouriel Roubini, the world-renowned economics professor known as Dr Doom, was in Athens last week with a message: the worst of the global financial crisis might be over but for Greece recovery could only occur with an "orderly restructuring" of its huge public debt. Although he is dismissed by some as a permanent pessimist, his prediction of a Greek default is gaining traction in the EU's most indebted nation".

Posted by alan @ 11:18 PM 2 Comments

Christmas is a time for lending...

Telegraph: Six million people borrow money to pay for Christmas

"Almost six million people have borrowed money to pay for Christmas, up almost 50 per cent on last year, researchers have claimed." Just as well i've managed to convince family and friends that i've converted to the Jehovah's Witnesses...

Posted by sibley's b'stard child @ 04:14 PM 26 Comments

Time for a pay rise

Bank of England: Inflation Attitudes Survey

All important inflation expecations are jumping up again. Moreover; Question 14: Respondents were asked to assess the way the Bank of England is ‘doing its job to set interest rates to control inflation’. The net satisfaction balance – the proportion satisfied minus the proportion dissatisfied – was 22%, compared with 28% in August.

Posted by ontheotherhand @ 02:04 PM 6 Comments

Buying commodities for profit is to speculate against human ingenuity

Pragmatic Capitalist: Commodities and the 130 year bear market

Thought provoking piece from Dylan Gryce on why buying commodities is not investment, and why over a long periods of time the relative return from commodities is close to zero

Posted by bellwether @ 01:56 PM 3 Comments

Listen, yeah, we're the good guys.

Independent: City says it pays 11.2 per cent of Britain's taxes

"The City of London yesterday sought to put a more positive sheen on its somewhat tarnished reputation, arguing that Britain's financial services industry last year accounted for more than £1 of every £10 raised by the Treasury in tax."

Posted by sibley's b'stard child @ 01:56 PM 7 Comments

Only the government should be able to tell you about house prices.

BBC: Single house price index 'should be introduced'

All of these pesky house price indices blathering negative numbers one after another. 3 month on 3 month, mix adjustment, asking prices. It just confuses your average punter. What we need is a government advisor to tell the house owning voter what is happening to house prices.

Posted by ontheotherhand @ 01:16 PM 11 Comments

State safety net will prevent repossessions

The Daily Telegraph: Why losing your job need not mean losing your home

...and prevent realistic house prices returning as zombie banks prop up zombie borrowers. Marking to market has forced realistic appraisals in the commercial property sector, but for residential property it seems that the overvaluations can continue indefinitely. That the housing market has not yet fallen as much in real terms as in 1989-93 is often attributed to the better state support for mortgagees, but does anyone have any statistics on how many people really are being supported and at what cost? I tried looking into this but the multiplicity of state schemes and their complex rules defeated me. But then I only have a PhD in finance.

Posted by monty032 @ 11:29 AM 29 Comments

They don't like it up 'em...

Estate Agent Today: Agent slams national house price reports as misleading

This is hilarious, EA complaining that national reports are misleading the public that things are worse than they actually are. Strangely enough, I don't recall hearing any of their ilk complaining about the same methodology on the way up. Duplicitous snakes in the grass.

Posted by sibley's b'stard child @ 10:31 AM 3 Comments

Money.co.uk - Great Britain's debt infographic

Money.co.uk: Great Britain's great big debt

The infographic looks at the extent of Britain's debt and how it affects us all, including which areas will be worse off after the cuts. With various groups in Britain gearing up to losing up to 20% of their income as the difference between rich and poor could be set to increase dramatically, some will be suffering a great loss while others could benefit from the cuts.

Posted by matt @ 08:47 AM 0 Comments

Wednesday, December 15, 2010

Lenders try to talk up the market

Guardian (blogs): 2011 will be best year to buy a home, says BSA

A survey by the Building Societies Association says next year will be a prime time to buy. But this doesn't mask the fact that alternative data paint a much bleaker picture. A third of respondents thought property values would rise next year, while 36% said prices would fall and 15% thought they would stay the same. Presumably the others had no idea.

Posted by drewster @ 11:54 PM 3 Comments

Landowners complain that they aren't being allowed to hold the economy to ransom

Telegraph: Property industry attacks Government over 'damaging' change to empty rate tax

The property industry has accused the Government of a "damaging and retrograde step" after it was announced small properties will no longer be exempt from empty rates. At present, properties with an estimated annual rental income below £18,000 do not have to pay the Empty Rates Levy – which taxes buildings empty for more than three months – after Labour introduced exemptions in 2008. However the government will cut the exemption threshold to just £2,600 from April in a move that will boost tax revenues by £400m. Critics have nicknamed the levy the "bomb-site Britain tax" because it has led to owners of empty properties demolishing buildings rather than pay tax on them. [Gosh, looks like we'll have to tax the land itself then....]

Posted by drewster @ 11:51 PM 12 Comments

Interesting point of view from an MP

Conservative Home: Safe as houses? Savings should not always be bricks and mortar

Solve the underlying causes of the West’s failure to save adequately and the global imbalances that lie at the heart of the current financial crisis should then correct themselves. Yet as the events of these tumultuous past two years show us, this is far easier said than done.

Posted by autograph @ 10:33 PM 0 Comments

So have the banks learned anything

Independent: Taxpayers likely to break even on bank bailout, says watchdog

Britain's unprecedented bailout of the banks is unlikely to cost the taxpayer a penny, the Government's spending watchdog will say for the first time today. The National Audit Office (NAO), which scrutinises public spending on behalf of Parliament, will say that while the bailout committed almost £1trillion of public money to the banking system, the "most likely scenario" was that taxpayers would, in the end, break even.

Posted by quiet guy @ 06:33 PM 17 Comments

RBS refuse to allow even the sanitised whitewash to be published

BBC: RBS 'blocks FSA publication of bank investigation'

Royal Bank of Scotland (RBS) has blocked the Financial Services Authority (FSA) from publishing its study into the bank's near-collapse, FSA chair Lord Adair Turner has said. He called the situation "extremely unsatisfactory" in a letter to Treasury committee chair Andrew Tyrie.The FSA found RBS guilty of poor decisions, but not any actual offences. According to Lord Turner, the financial services regulator is only legally able to make a unilateral decision to publish the details of its investigation if enforcement action is to be taken against the culpable party. Otherwise, the permission of all the parties is involved, and "RBS has made it plain that it does not wish to provide consent", he said.

Posted by mark wadsworth @ 04:59 PM 9 Comments

Just a 95% drop from peak...

Telegraph: UK mortgage lending to fall to 30-year low

The Council of Mortgage Lenders has forecast that net lending will fall to just £6bn next year, the lowest since 1980. Before the credit crunch hit in 2006, net lending totalled £110bn.

Posted by timmy t @ 03:36 PM 0 Comments

Mortgaged homeowners struggling to find jobs

Telegraph: Middle-aged 'missing out on jobs recovery'

The middle aged are missing out on the jobs recovery with two in three new positions going to those under 35 and the remainder being taken up by the over-50s, figures show. In fact workers in the 35-50 age bracket, the largest single age demographic in the workforce, comprising almost 11 million workers, continue to register a rise in unemployment. [It seems plausible that workers in the 35-50 age bracket are also the most likely to have a mortgage, compared with under-35s (no house) and over-50s (house paid off). This could really rock the housing market.]

Posted by drewster @ 02:22 PM 17 Comments

Real Interest rates set to rise across the world

Investment and Business News: Interest rates set to rise as economic tectonic plates shift – is this good or bad news

A new report from McKinsey is predicting higher global interest rates, relative to inflation for the foreseeable future. In a nut shell it is forecasting a rise in global investment while global savings fall, as China saves less and consumes more, and as the ageing population in the developed world eat into their savings. This will be the complete opposite of what we have seen since the mid 1970s when savings growth outpaced investment growth. As a consequence, the global economy will see faster growth, but indebted countries, banks, and households will lose out. Default is likely to follow, and in the West, house prices will look more precarious than ever.

Posted by mike @ 01:13 PM 0 Comments

More vaguely interesting statistics/forecasts

Mortgage Strategy: Gross lending to remain flat in 2011, says CML

"Gross mortgage lending is forecast to remain flat at £135bn next year, Council of Mortgage Lenders data shows. In its News and Views the CML says net lending is expected to drop from £9bn in 2010 to £6bn in 2011. The number of arrears is predicted to rise from 175,000 this year to 180,000 next year while repossessions will increase from 36,000 to 40,000." The article also says that there are only 18 million privately owned homes in the UK, which is very much on the low side. The VOA publishes a list of 23.2 million houses by council tax bands in Eng & Wales alone, so add on 15% for Scot & NI = 27 million and knock off 4 million council homes = 23 million.

Posted by mark wadsworth @ 11:43 AM 9 Comments

Can we join the party please?

Guardian: First-time buyers locked out as house prices fall

However, my favourite comment comes from Ian Briggs of Dacre, Son & Hartley in Ilkley. "Given the torrid levels of November sales activity, myself and all of Ilkley's estate agents have just leapt off a cliff (for charity). Such a shame that the nation's mortgage lenders were disinclined to join us."

Posted by sibley's b'stard child @ 11:32 AM 4 Comments

Vaguely interesting statistics

City AM: Homeowners relaxed about negative equity

There are some typos or errors though. It appears that about 5% of borrowers (= about 500,000 households) are in nequity and another 8% (about 1,000,000) are in a break even (is that called 'zequity'?) position. Unsurprisingly, nequity is quite common with under 35s and very rate with over 55s. So far so good. The article then states that average nequity among those who have it is a rather alarming £52,338, which seems way off piste to me. Sure, average selling price might be down by ten per cent from peak (say a fall of £20,000 per house), but it's only a million or two people who bought at the peak, and surely they didn't ALL buy with 100% mortgages?

Posted by mark wadsworth @ 11:19 AM 22 Comments

We have no choice but to put up rents...

Northampton Chronicle and Echo: Tenants facing 6% rent rise

"RENTS are set to rise by almost six per cent for more than 12,000 council tenants in Northampton." "Councillor Sally Beardsworth (Lib Dem, Kingsthorpe), cabinet member for housing, said: “These are tough economic times for many people but we have to follow the Government’s rent policy and are in a position where we have no alternative but to increase rents. " We're only following orders....

Posted by thecountofnowhere @ 10:13 AM 0 Comments

Unemployment in UK Rising Again

BBC: Unemployment in UK Rising Again

Unemployment in the UK increased by 35,000 in the three months to October to 2.5 million, the Office for National Statistics (ONS) has said.It was first time that the UK jobless total has risen for six months.The increase pushed the unemployment rate up to 7.9%, the highest since the start of the year. However, the number of people claiming the Jobseeker's Allowance in November fell fractionally, by 1,200 to 1.46 million, the ONS said.

Posted by cat and canary @ 09:56 AM 71 Comments

How else will the Express readers release their paper wealth?

Houseladder: Demand for property 'still high'

Oh well, if we're going to set the tone this morning with the laugh-along that is the Express, let's turn-up the 'ridiculous' dial to maximum. Still, they manage to undo all their ramping good work by quoting the chap from PricedOut

Posted by sibley's b'stard child @ 09:52 AM 3 Comments

Yipppeeeeeee!

BBC News: Repossessions to rise in 2011, lenders forecast

The CML says there are some mortgage borrowers who will not be able to hold out any longer. The CML says there is no chance of the severe mortgage rationing of the past couple of years easing off.

Posted by cynicalsoothsayer @ 09:51 AM 6 Comments

Front page Express - House prices up £5k in a year

Express: HOUSE PRICES UP £5,000 IN A YEAR

The value of Britain’s housing stock rose to £5.55trillion in 2010, according to figures released today. It means every house owner in the UK recorded a daily average rise of £13.64 – or £4,978 annually – as a typical three-bedroom semi rose 2.36 per cent in value to £215,824 from £210,846 last December. Property experts were last night hailing the increase as proof of the resilience of bricks and mortar in a fragile economic environment.

Posted by jack c @ 09:24 AM 9 Comments

Bank of England's Bankrupt Inflation Propaganda...

Market oracle: Bank of England's Inflation Targeting Mandate is Bankrupt as CPI Rises to 3.3%

'...[BOE's] quarterly inflation reports are nothing more than economic propaganda aimed at psychologically managing the populations expectations on the economy and inflation...'

Posted by hpwatcher @ 08:43 AM 10 Comments

Tuesday, December 14, 2010

First Time Buyers will struggle to save deposits during 2011

Telegraph: Savers will find it hard to put money aside in 2011

Rising levels of inflation could mean that savers have to use all their money to pay the bills and find themselves unable deposit any money in a bank or building society. Most economists (modern-day soothsayers) fear that even though the recession (supposedly) finished a year ago and that the economy is (apparently) on track to recover steadily next year, the average person's salary is not climbing (well strike me down with a cucmber) as quickly as the cost of living.

Posted by enuii @ 10:01 PM 6 Comments

CGT rules to be tightened

The Telegraph: Home flipping capital gains tax relief is 'questionable', says OTS

I am suprised not to see this article here already, it has to be the biggest single change for BTL in the last 25 years, regardless of Yield and Loan to Asset value the majority of BTL landlords do so to make a overall asset value gain. While that gain is correct and who wouldnt it seems it will no longer be the case of moving into it for 3 years, calling it your home and then selling it tax free

Posted by rimmer @ 09:42 PM 0 Comments

I'd like local people to able to decide...

Pollcode.com: The New Localism

Why stop at "Preventing new development?" was my first thought. Why not allow Neighbourhood Committees to decide what type of business may be carried out in their area, who is allowed to buy a car, how many children each woman can have or what careers young people should take after leaving school? To my mind, there's only one correct answer.

Posted by mark wadsworth @ 08:31 PM 6 Comments

Ron Paul to oversee the FED

The Hill: Fed critic Ron Paul wins oversight gavel

Ron Paul has been a very outspoken critic of the Federal Reserve itself, and has, in the past, introduced legislation to abolish it, as well as to run a full audit of the bank's operations.

Posted by refusetobuy @ 04:35 PM 10 Comments

It's begun...you can almost hear the squealing...

Northampton Chronicle and Echo: 600 people to lose their jobs as massive cuts are announced at County Ha

"Lollipop ladies, libraries and street lights are among services which could face major cuts under Northamptonshire County Council’s cash-saving budget plans. The leaders of the authority published details of their £67.6 million saving plans on Tuesday morning." No mention of massive salaries and obscene pensions being cut then....

Posted by thecountofnowhere @ 03:42 PM 0 Comments

Article published yesterday and a fitting tribute to today's inflation figures

FTAdviser.com: MPC will watch inflation indicators "like hawk"

The Monetary Policy Committee (MPC) will be watching indicators of inflationary pressure "like the proverbial hawk" an MPC member has claimed. Many recent indicators have given comforting signs that an economic recovery is underway but it may be some while yet before normality is restored, Charles Bean, deputy governor for monetary policy and member of the MPC. In a speech in London, Mr Bean admitted that despite an economic recovery broadly in line with the MPC's expectations, inflation has been considerably higher than the MPC expected last summer.

Posted by jack c @ 02:15 PM 14 Comments

LVT questions?

Guardian: What do you want to ask Andy Burnham

Lots of people posting potential questions for an upcoming Andy Burnham interview in the Guardian. Any Land Value Tax fans might want to quiz him on the Labour Party's manifesto overhaul and whether such taxes are being talked about. Be great to hear is views on Brown's policies, their aftermath, BTL booms, over-reliance on the City instead of manufacturing base etc.. etc... Currently most of the posted questions are on tuition fees.

Posted by chris moran @ 01:51 PM 0 Comments

The economics indicate a long downward spiral

The Guardian: Housing market slowdown blamed on spending cuts and lack of buyers

"Jeremy Dell, a surveyor in Oswestry, Shropshire, said: "The housing market is only a shadow of itself in 2007. The economics indicate a long downward spiral."

Posted by jonathan @ 12:18 PM 0 Comments

Fear not, a new tranche of slave labour to keep costs down

Independent: Population rise gives India the edge over one-child China

Sean O'Grady cheers for exponential population growth. Not only that, but he champions the Indians who have the enviably perfect population demographic. A young and growing population which (unlike China & Japan) won't be bogged-down by those pesky pensioners draining the nation's wealth. Thankfully, they have a low expenditure on health which I take to read higher mortality rates. For all you nay-sayers, just think what our inflation would be without these serfs manufacturing our cloths and toys and electronics? Natural resources you say? La la la, can't hear you.

Posted by sibley's b'stard child @ 11:33 AM 1 Comments

Unexpectedly?

Reuters: Inflation rises unexpectedly in November to six-month high

"Consumer price inflation rose unexpectedly to a six-month high of 3.3 percent in November, driven by rises in the cost of food and clothing, the Office for National Statistics said on Tuesday".

Posted by alan @ 10:15 AM 5 Comments

We've been expecting you Mr King...

Guardian: Inflation hit 3.3% in November

"UK inflation rose unexpectedly in November, missing the government's official target for the eleventh month in a row, as rising food and clothing prices pushed up the cost of living."

Posted by sibley's b'stard child @ 10:14 AM 43 Comments

U.K. Housing Gauge Close to 18-Month Low in November

Bloomberg: U.K. Housing Gauge Close to 18-Month Low in November

A U.K. housing-market gauge stayed close to the lowest in 18 months in November as demand for homes waned, the Royal Institution of Chartered Surveyors said. The number of real-estate agents and surveyors saying prices fell exceeded those reporting gains by 44 percentage points, compared with minus 49 points in October, the London- based group said in an e-mailed report today. Economists forecast a decline to minus 50 points, according to the median of 16 predictions in a Bloomberg News survey

Posted by karma4all @ 09:37 AM 2 Comments

For those who think the BTL brigade will snap up properties as prices fall

Daily Express: Would-be Landlords Urged To Weigh Up Risks Of Buy-to-let

Some real home truths here - from the Express! A few days old, but well worth reading to counter those who think the next BTL surge is already upon us...

Posted by rantnrave @ 09:26 AM 16 Comments

Property bear has doubts

Investment and Business News: UK house prices set to fall but not crash, suggests latest RICS housing market survey

There is much in the latest RICS report to be bearish about. And yet one has to be honest about these things. The RICS housing market survey may be just about the best report out there for gauging the state of the UK housing market, and it may unambiguously be pointing to falling house prices for the next few months, but at the same time it is clearly not yet pointing to an outright crash in house prices. If anything, the latest report might suggest gentle falls in the year ahead.

Posted by mike @ 09:02 AM 0 Comments

It all came as such a surprise to everyone!

Wikileaks - Guardian: Mervyn King plotted banks bailout by four cash-rich nations

March 2008 - "Bank of England governor suggested new group of UK, US, Swiss and Japan could facilitate global bailout, cable shows". "Six months before the world financial crisis reached its peak, forcing taxpayers to rescue collapsing financial institutions, King told US officials in London that the UK, US, Switzerland and Japan could jointly enable a multibillion-pound cash injection into global banks, overriding the "dysfunctional" G7 nations".

Posted by alan @ 07:52 AM 2 Comments

I can see very dark months ahead and very little anybody can do about it

Daily Telegraph: Home owners face repossession amid struggle to sell properties

“We know from the cases we see every day that just one single thing, like a bout of illness, rent increase or drop in income, is all that’s needed to push people into spiral of debt and arrears that can lead to the loss of their home" Is this the start of the rout?

Posted by growler @ 07:24 AM 18 Comments

One reason why Britons don't like flats

Daily Mail: The £700million scandal of property service charges

Two million flat owners are wasting £700million in service charges thanks to a combination of greedy managing agents, leaseholder apathy and ignorance of the law, according to an industry survey. In worst scenarios, management firms are using subsidiary companies to carry out work at inflated prices and then adding commissions on top of the cost of the work. Other agents are accused of failing to shop around for the best deals for their leaseholders, particularly concerning insurance which usually accounts for the highest proportion of the service charge. At a block of 44 flats in Cheltenham, residents had been paying £7,057 a year - £160 per flat - until they discovered that identical cover through a different firm cost just £2,165, or £49 per flat. The elderly are most vulnerable.

Posted by drewster @ 04:08 AM 1 Comments

Monthly RICS survey reveals falling market

BBC News: Housing market 'is being stifled'

The housing market is being stifled by a lack of first-time buyers and economic confidence, according to surveyors. More reported prices falling than rising in November - a similar picture to the previous month, said the Royal Institution of Chartered Surveyors. New buyer enquiries, newly agreed sales and average sales per surveyor all fell in November, the survey found. Prices were falling across the UK and activity remained slow. However, the end of the year is generally a slow time of year for the housing market and surveyors believe some sellers will wait until the new year before putting properties on the market.

Posted by drewster @ 03:34 AM 8 Comments

The perils of homeownerism: Argentina used to be a rich country

BusinessWeek: Argentina: Squatters demanding housing grab land

Land grabs by poor families demanding decent housing spread to two more properties in Argentina's capital Monday as politicians pointed fingers and police declined to evict them in fear of bloodshed. The illegal occupations now involve more than 5,000 people, and at least three squatters have been killed in violent confrontations with angry neighbours.

Posted by drewster @ 03:29 AM 0 Comments

Monday, December 13, 2010

Down down, deeper and down

I'm Billericay Dickie and I'm doing, very well

But, but, you said we were immune darling!

Estate Agent Today: Asking prices slide, and more falls to come

"Even in London, house values finally no longer seem immune to the rest of the market. In November, the average London house price was £420,248, but this month they have dropped almost £12,000 to £408,789"

Posted by sibley's b'stard child @ 04:32 PM 2 Comments

...and the starving hyenas eventually turned on each other

Estate Agent Today: Countrywide agent ticked off by advertising watchdog

Synopsis: One shady mob complains to ASA about rival shady mob's activities.

Posted by sibley's b'stard child @ 04:27 PM 0 Comments

Stormclouds on the Horizon?

Telegraph: Market alarm as US fails to control biggest debt in history

Stormy times ahead for any nascent economic recovery?

Posted by alan_540 @ 02:52 PM 12 Comments

Price drops galore all over

Rightmove: December 2010 Regional trends

Latest RM data still looks unreported on the BBC web site. Funny that. When asking prices were rising, they could'nt plaster it up quick enough, spliced with the odd cheers leader from a London chain of EAs.

Posted by doomwatch @ 01:27 PM 5 Comments

As useful as a chocolate teapot?

Independent: Residents given right to run pubs

"Residents will also be able to apply for new homes to be built locally if they believe there is a shortage of affordable housing or families need to be attracted into the area. Building schemes supported by more than 50 per cent of voters in a referendum would get the go-ahead – rather than the 75 per cent previously proposed by the Government. The scheme will operate in all types of community, and not just rural areas. The moves will be set out in a Localism Bill to be published on Monday."

Posted by sibley's b'stard child @ 01:15 PM 11 Comments

NIMBYs' Charter - already killing off new developments

BBC: 'People power' planners face home truths

That new homes bonus could have netted North Somerset Council something in the region of £80m for the South West Urban Extension. But its deputy leader, Elfan Ap Rees, says all that money would have made no difference. "The greenbelt is more important than money," he says. For the first time in 30 years, he said, his council was planning its own destiny. "Clearly in some areas of the country more homes will get built and there will be local people who really want new houses," he says.

Posted by mark wadsworth @ 12:23 PM 4 Comments

Another speculative land bubble

Property Wire: UK farmland predicted to increase by up to 12% in 2011 as foreign buyers compete for best locations

Property buyers and investors in the UK farm land sector can expect prices to increase by an average of 6% in 2011, according to analysts. The predicted increase in values will follow an 8% increase in 2010 but there is expected to be a widening gap in value growth between the best and poorest quality land, with expectations that where there is purchaser competition values could easily increase by 12% next year.

Posted by khards @ 11:57 AM 2 Comments

Happy Xmas

Mortgage strategy: House prices fall 3% in December

“Against this backdrop, even the estate agents are already predicting a further 5% price drop next year. I fear they are being overoptimistic again, just as their thankless job requires.

Posted by happy mondays @ 11:44 AM 2 Comments

Keep pumping

Standards of living to diminish with attempts to save the Euro

Daily Telegraph: Euro has 'one in five chance' of collapse, warns CEBR

Telegraph editors making 'errors' again! Comment section: "Philip Aldrick got it right - he was let down by the sub editors who wrote the headline. What I said was that there was a one in five chance of the euro surviving! In other words a four in five chance of it collapsing." Douglas McWilliams (Supposedly)

Posted by tom101 @ 11:09 AM 1 Comments

Fun with numbers

City AM: 500,000 households in negative equity

"Close to one in five mortgage holders have debts exceeding 75 per cent of the value of their properties, “not much changed” from last year, the report says." OK, let's ignore everybody with LTV of 75% or less and assume that one-fifth of borrowers have a mortgage of £180,000 on a house currently worth £200,000. Even if prices fall by a quarter, the average nequity of that one fifth of borrower will be £30,000. Times £30,000 by two million borrowers and we have a shortfall of £60 billion. Let's assume half default, go bankrupt AND have house reposssed and dumped at lower value. The total loss to UK banks would be a laughable £30 billion, or about one-quarter of one per cent of what UK banks claim to have as total assets. In truth, it's closer to two per cent of total assets, hey.

Posted by mark wadsworth @ 10:45 AM 11 Comments

Downward spiral of debt

Telegraph: Low interest rates failing to rescue British households from £1.45 trillion debts, says Bank of England

'Despite record low interest rates, half of respondents reported a fall in monthly disposable income after tax, mortgage, rent, bills and other loan payments. Nearly a third, 29pc, said their debt concerns had risen over the past two years, compared with just 12pc who are now less worried.'

Posted by hpwatcher @ 08:25 AM 5 Comments

Another rehash of the press release covered by Little Prof

Sky: Property Sellers Drop Prices In December

Average property asking prices fell by nearly £7,000 pounds to £222,410 pounds in the four weeks to December 4, according to new research by property website Rightmove. It is the biggest December fall since the 3.2% drop in 2007 after the collapse of Lehman Brothers. The latest decline means 2010 asking prices have virtually stoodstill - only increasing by 0.4%."

Posted by mark wadsworth @ 07:40 AM 1 Comments

Rightmove: -3% MoM, +0.4% YoY

Press Association: House prices fall 3% in four weeks

Property website Rightmove said average property asking prices fell by nearly £7,000 to £222,410 in the four weeks to December 4, the biggest such fall since the 3.2% drop in 2007 after the collapse of Lehman Brothers. House sellers slashed asking prices by 3% during the past month in the worst November/December performance for three years. Asking prices in England and Wales have now fallen in five of the past six months.

Posted by little professor @ 12:34 AM 46 Comments

Sunday, December 12, 2010

AEP: Euro R.I.P

The Telegraph: The eurozone is in bad need of an undertaker

There will be no Eurobond, no increases in the EU’s €440bn (£368bn) rescue fund, and no mass purchases of Spanish and Italian bonds by the ECB. Nothing. The system is political and constitutionally paralysed. Spain and Portugal will be left nakedly exposed before their funding crunch in January.

Posted by devo @ 10:13 PM 5 Comments

Don't, don't believe the hype.

Independent: David Prosser: Don't believe the retail industry when it says the high street is booming

So is it going to be a Merry Christmas for Britain's retailers? The high street will be busy today, enabling retailers to say customers are flooding in. You'll see a flurry of claims about record sales, rising footfall and shortages of must-have goods. This is psychological warfare. Get the message out that everyone else is splurging, retailers reason, and reluctant shoppers will feel the need to join them.

Posted by sibley's b'stard child @ 09:37 PM 2 Comments

What Will This Do To Interest Rates

BBC NEWS: EU to target private lenders in future bail-outs

"The EU plans to make private lenders cover the losses of any future eurozone debt crisis, the BBC has learned. The decision may significantly raise the future cost of borrowing for over-indebted eurozone governments."

Posted by wdbeast @ 04:06 PM 1 Comments

The real Monopoly

Wikipedia: The Landlords Game

A wonderful way for HPCers to spend Christmas with their families this year. You can print it out and play to your hearts content.

Posted by the number cruncher @ 11:00 AM 5 Comments

Banking monopoly ruling the world - surely not....

New York Times: A Secretive Banking Elite Rules Trading in Derivatives

monopolies, and not genius is the secret behind bank profits and those profits are a direct result of robbing the productive economy - I would be interested in the opinions of the defenders of our financial industry - flash and techie's opinion

Posted by the number cruncher @ 10:16 AM 16 Comments

What will this do for London house prices?

BBC website: Bankers' bonuses to face 'dramatic' change

Bankers bonuses have been the traditional driver for London house prices at the top end. These much more draconian than anticipated measures come into force in the new year and will apply to bonuses for last year. I can hardly wait for the squeals of pain and misery we will now be subjected to. Apparently the 'threat' is they will all relocate to Singapore. Fine by me: but really that's hot air, life in London has a lot more to offer than a sweaty ex-swamp with few good cultural facilities. Best news I heard in ages.

Posted by matt johnson @ 10:13 AM 0 Comments

Bankers forced out of their ivory towers

Guardian: Financiers forced out of Belgravia to 'banker belt' in the suburbs

Britain's bankers are set to splash out £1bn of bonus money on luxury homes in the capital next year – although City types are being crowded out of central London by higher taxes and competition from wealthy foreigners

Posted by notaguru @ 09:41 AM 0 Comments

Fix the economy: break up the big banks

Zero Hedge: The Economy Cannot Recover Until the Big Banks Are Broken Up

A lot of people still haven't heard that the economy cannot recover until the big banks are broken up. But as everyone from Paul Krugman to Simon Johnson has noted, the banks are so big and politically powerful that they have bought the politicians and captured the regulators. No wonder so many independent economists and financial experts are calling for the big banks to be broken up, including...

Posted by devo @ 09:27 AM 3 Comments

Saturday, December 11, 2010

Multa cadunt inter calicem supremaque labra

The Guardian: IMF postpones approval of Irish bailout

Delay and uncertainty after Irish prime minister Brian Cowen says he will seek parliamentary backing for the €85bn bailout.

Posted by devo @ 09:45 PM 5 Comments

Bleeding each other dry over houses won't cure the problem - only make it worse.

Guardian: Britons lose faith in their powers of invention, survey shows

Britain once ruled a third of the world and its technological edge allowed it to run rings round its competitors. How different things are today. Britons have scarcely any confidence in the nation's ability to remain as innovative as its rivals, according to a study to be published this week. There is a pervasive fear the UK will slip further down the international league table, as the balance of power shifts from west to east.

Posted by dill @ 09:22 PM 6 Comments

Dearie dearie me......

The International Forcaster: The Consequences of Excessive Money and Debt

December 11 2010: Euro zone close to the edge, Germany resists, Europe stuggles with bailouts, quantitative easing must end, a deflationary depression must be accepted, more questions than answers at the Fed, fragile housing market......

Posted by braindeed @ 08:24 PM 3 Comments

Madoff son is dead

Guardian: Mark madoff found hanged

I haven't posted this to gloat,just to show what a tragedy money excess can leave in its wake.Whether or not he was involved makes no difference...these ponzi schemes are still going and its how the 'rich' have been shafting the workers since time began.Look how its all ended...

Posted by taffee @ 05:39 PM 3 Comments

Are we all in it together?

G Pytel: UK's 21st century democracy

In the wake of students' protests in London a couple of days ago, this blog post is particularly timely.

Posted by ant @ 03:52 PM 4 Comments

Something to amuse everyone.

The Onion: Wikileaks To Take On Bank Of America

Amidst the news surrounding the sensitive diplomatic information released last week, Wikileaks head Julian Assange hinted that he would be releasing documents from a major financial institution. The Onion has been granted special access to these documents, and is proud to present some of the more damning revelations about Bank of America.

Posted by nathan @ 01:55 PM 5 Comments

Put your money where your mouth is

FT: RBS to offer house price derivatives

The Royal Bank of Scotland is preparing to launch residential derivatives products aimed at retail investors who are prepared to bet against the odds that house prices will rise. The bank’s own residential lending exposure means it will act as the counterparty to the trades, which will be pegged against future increases in the Halifax house price index. However, the forward curve for residential derivatives – the nearest thing to a property futures market – is pricing in a 10 per cent price drop to house prices in 2011.

Posted by quiet guy @ 01:39 PM 3 Comments

Poor stuck with renting

FT: First-time compete to buy property

There is a significant gap opening up amongst Britain's aspiring first-time buyers in terms of the amount of money saved for a deposit. While a third of first time buyers have less than a 10% deposit saved, almost half have saved at least a 40% deposit. This has been identified as a "deposit gap," as a wealthier working population in their twenties benefit from higher salaries and savings and loans from richer parents, while those from poorer backgrounds struggle to save. Contradicting reports of a fragile housing market, the survey found demand for property is high. 25% of respondents said they would have liked to buy a house, but did not have the required deposit. Mortgage availability was also an issue: 71% of respondents said it was more difficult to obtain a mortgage than a year ago.

Posted by drewster @ 12:15 PM 8 Comments

What went wrong in China...

Telegraph: 85pc of urban Chinese cannot afford to buy a home as inflation accelerates

China's property bubble has grown so huge that 85pc of Chinese living in cities can no longer afford to buy a home, according to an influential Chinese government think tank. The Chinese Academy of Social Sciences (CASS) said that a typical Chinese property now costs 8.8 years of average earnings. In addition, house prices are still rising far in excess of wages, putting property beyond the reach of average Chinese. CASS estimated that Chinese property prices had risen by 15pc this year, although the rises in some cities have been far steeper. "House prices have risen steadily for years," said Zhou Linhua, co-author of the report. "This has inflated investor expectations of a high return, which has brought more money flooding into the market."

Posted by drewster @ 11:46 AM 4 Comments

What went wrong in Ireland...

You tube: An Irishman abroad tells it like it is

The honest truth about the Irish situation

Posted by hpwatcher @ 09:46 AM 8 Comments

Friday, December 10, 2010

Neither a borrower nor a lender be

The Telegraph: Someone forgot the poor lender in all this talk of debt forgiveness

Since when has it been acceptable practice to run away from your debts? Well right now the idea seems to be all the rage. Eminent economists from around the world have come together to agree that that the only way out for the eurozone’s beleaguered peripheral economies is to “restructure” their debts – a polite term for default.

Posted by devo @ 10:42 PM 24 Comments

You can place a poor bet that house prices will rise.

Financial Times: RBS to offer house price derivatives

The Royal Bank of Scotland is preparing to launch residential derivatives products aimed at retail investors who are prepared to bet against the odds that house prices will rise. These sorts of products should be banned. They are fundamentally immoral and help prevent ordinary people from getting affordable housing.

Posted by miken @ 10:10 PM 12 Comments

HPC article - when "flat" actually means "falling"

Moneyweek (Blog): House prices are already crashing

The latest Halifax numbers showed prices falling by 0.1% in November and 2.1% in the last three months. The annual rate of price falls is now 0.7%. It is, says Martin Ellis, housing economist at the Halifax, "consistent with a relatively flat overall trend in house prices".

Posted by rental john @ 04:56 PM 0 Comments

Finally a balanced piece from the Guardian!

Guardian: House prices survey highlights market contradictions

Starts off as the usual cut & paste from the Academetrics news. Gets more interesting toward the end though! Nice to see HPC as one of their recommended sites in the menu on the bottom right!

Posted by rantnrave @ 04:14 PM 4 Comments

Does this count as inflation?

Sky: Fuel Costs In Britain Hit Record Level

"Petrol prices have hit a record high in Britain with unleaded costing an average of 121.76p a litre - with further increases in the pipeline, according to the AA". ..But the big question is - why are prices so high when the price of a barrel of crude oil is well below its peak of $145 in July 2008? It now stands at about $90. "The OFT has told Sky News it is not currently investigating fuel prices on either price or competition grounds".

Posted by alan @ 04:04 PM 7 Comments

Trust is a many splendid thing:0)

The Independent: Trust me, I'm an estate agent: How underhand technology is being used to sell homes

Particularly like the last point in the 'cut through the patter' section, and I think many of you will too.

Posted by bystander @ 03:36 PM 10 Comments

Down, down, deeper and down

Independent: Propety market gloom as lending figures slump

I'd quote the whole article if I could; a veritable cornucopia of bearish bites... "The drop in lending comes after declining house prices and because of a rush to take advantage of a stamp duty holiday a year ago, according to the CML."

Posted by sibley's b'stard child @ 01:36 PM 2 Comments

Viva la recovery

Telegraph: Sterling will be strongest major currency in 2011, says Barclays

"The pound, which has been hard hit since the financial crisis, will end next year at $1.82 against the dollar and 78p versus the euro, it was estimated. The currency closed on Thursday in London at $1.5728 and 84p."

Posted by sibley's b'stard child @ 12:19 PM 19 Comments

Higher bond yields will push mortgages higher too

MoneyWeek: Is this the end of the great bond bull market?

What's going on in the world's government bond markets? All of a sudden, yields are rising fast again. In other words, sovereign bond prices are plunging. You can now get between 0.5% and 0.75% a year more by buying a ten-year US, UK or German government bond than you could two months ago. Even yields on Japanese sovereign debt, traditionally the lowest of the lot, have climbed sharply. So are we now finally seeing the end of the great long-term government bond bull market? If so, why – and what's next? Three reasons this bull market could be over: (1) There's hardly anyone left to buy. (2) Global sovereign liabilities are now so big, and growing so fast, they're right out of control. (3) Global inflation is likely to make a comeback much faster than many expect.

Posted by drewster @ 11:11 AM 23 Comments

More Home-Owner-Ist bleating and propaganda

Estate Agent Today: Plan to raise taxes on homes shocks industry

Apparently, the OECD have yet again explained that taxes on land values (for some reason referred to as "taxes on property"?) are a far bettter way of raising money than income tax, VAT and so on. The Home-Owner-Ist coalition quickly spout all the usual lies, see article. None of anything they says stacks up in logic or fact. Lies, lies, lies. But this sort of thing makes me realise what an uphil battle explaining LVT is, the Dark Side already have well-rehearsed propaganda teams in place. *sigh*

Posted by mark wadsworth @ 10:56 AM 6 Comments

Battersea and Chiswick here we come!

Bloomberg: London Bankers to Spend $1.6 Billion of Bonus Payout on Homes

"London bankers and other financial- services employees will spend about 1 billion pounds ($1.6 billion) of their 2010 bonus money on homes in the U.K. capital, 17 percent less than last year, Savills Plc said".

Posted by alan @ 10:55 AM 1 Comments

House prices might be falling, but the cost of moving is rising

Citywire: Selling your house: an expensive move in a failing market

Allegedly the cost of moving has almost tripled in the last decade, to an average of nearly £10,000, and it's likely to go up more. Who'd want to sell their house with prices going down and a massive cost to move as well? I'm a first time buyer desperately hoping to get on the property ladder next year and it just looks less and less like it's going to be possible.

Posted by mazaru @ 10:24 AM 3 Comments

I...see white elephants.

Telegraph: South Africa recoups just a tenth of the £3bn cost of staging World Cup 2010

South Africa made a return of just £323m on the £3bn it spent on building stadiums and infrastructure for this summer's tournament, according to official figures.

Posted by sibley's b'stard child @ 10:12 AM 6 Comments

Oh Dear!

Estate Agent Today: Plan to Raise Taxes on Homes Shocks Industry

A proposal that the Government should look to raise more money from property taxes has met with furious opposition from the estate agency industry.

Posted by magnaman @ 09:14 AM 0 Comments

Do we need a Wikileak?

Mail: Arrogance, incompetence and a shameful bid to hide the truth about the bank collapse that nearly ruined Britain

"The refusal to make public the report into the catastrophic failure of the Royal Bank of Scotland tells us a great deal about the arrogance and hopeless judgment of the City's financial regulator. While the FSA often takes a hammer to deal with minor miscreants, it is using kid gloves when it comes to dealing with the scandalous behaviour of bosses who brought down Britain's biggest financial group and which led to taxpayers being exposed to potential losses of £250billion".

Posted by alan @ 09:03 AM 6 Comments

UK most indebted nation after Spain says The Economist

ArabianMoney.Net: UK more indebted than Portugal, Ireland or Greece

In the authorative Economist league table of countries most endangered by high levels of public and private debt below it is the UK that comes second after Spain, and not the eurozone periphery of Portugal, Ireland and Greece. Japan is ranked after the UK and the US follows straight after Greece. It is an astonishing indictment of the leaders of the developed world that they are ranked up with the so-called economic basket cases.

Posted by david smith @ 03:32 AM 0 Comments

Hip Hip Hooray!

Daily Express: CHEER AS HOME PRICES ‘UNLIKELY TO PLUMMET’

Homeowners worried that the value of their property might tumble were given reason for cheer yesterday. The Halifax, the UK’s biggest ­mortgage lender, reported that prices dropped just 0.1 per cent from October to November as the property market stabilised. Spokesman Martin Ellis suggested that a shortage of housing stock was helping to support property values. He said: “Interest rates are also likely to remain very low which will support the improved mortgage affordability position for home owners.”

Posted by little professor @ 12:36 AM 20 Comments

Thursday, December 9, 2010

For Politicians, Any Old Debt = Wealth

Guardian: The slow shuffle that sees Britain condemned to a life of debt

The idea that debt can create wealth has been dealt a death blow by the credit crash. So why does the government persist in viewing lending as the answer?

Posted by enuii @ 11:14 PM 7 Comments

US still sliding downhill: $1tn lost in second half 2010

Bloomberg: US House Prices to lose another 1.7 trillion in 2011, says Zillow

Zillow are a major house price index, tracking 129 cities. Only 31 have seen house price rises this year. "The government can only hold the tide back for so long".

Posted by notyethomeless @ 08:54 PM 1 Comments

The Disenfranchised!!

BBC: Violent protests as MPs vote to raise tuition fees

Shift the debt from the banks to the taxpayer then to the children, job done. No wonder they're p!ssed off!! The baby boomers have had HPI, free education and a nice pension at the end. All they get is a mortgage for education, poor job prospects, unaffordable housing, probably no pension and the BBc reporters seem totally bemused why they're so mad.

Posted by cheekie charlie @ 08:37 PM 1 Comments

Skanska optimistic for housing in 2012

TD Waterhouse: DJ Skanska Drafts Blueprint To Enter UK Housing Market

It hopes to be selling 800 homes a year by 2015. "The financial crisis and the dramatic decline in the housing market have now created excellent opportunities for entry as a residential developer," Skanska said in a statement. The market has stabilized in the past year, and Skanska expects the recovery to begin in earnest in 2012, when it will start selling its first homes.

Posted by novice pete @ 08:05 PM 2 Comments

More on Inflation

Reuters: FSA says "penalty inflation" to continue

"The average fine slapped by the Financial Services Authority on firms it regulates nearly doubled this year compared with 2009 and will continue upwards, the markets watchdog said on Thursday". Obviously this isn't in any inflation "basket"

Posted by alan @ 07:21 PM 1 Comments

No, that's "because" and not "despite", you fool!

Evening Standard: Ray of hope despite a new house-price dive

Record low interest rates may save homeowners from a property slump despite house prices showing their first annual declines in a year, Halifax said today. Its latest index showed average prices edging 0.1% lower last month to £164,708, leaving property costs 0.7% down on November last year, as sliding demand combined with more properties for sale hit the market. Prices have fallen 2.4% so far this year. But housing economist Martin Ellis said there were “tentative signs” that homeowners were becoming more reluctant to put their properties on the market, which could ease the downward pressure on prices if the trend continues. As I like to say, now they hand it out free, the Evening Standard is value for money.

Posted by mark wadsworth @ 04:55 PM 4 Comments

A sign of things to come?

BLOOMBERG: Mortgage rates higher on signs economy mending

SAN FRANCISCO (MarketWatch) -- Freddie Mac /quotes/comstock/11k!fmcc (FMCC 0.30, +0.00, +0.03%) said Thursday the 30-year fixed-rate mortgage average rose to 4.46% with an average 0.8 point for the week ending Dec. 2. In the previous period, the average was 4.40%, and the year-ago average was 4.71%. "Mortgage rates followed bond yields higher this week as recently released economic data suggest the economy may be stronger this quarter than the previous," said Frank Nothaft, Freddie Mac chief economist, in a statement. "House prices indices, however, are trending downwards. The 12-month growth rate in the S&P/Case-Shiller 20-city index eased from 1.7% in August to 0.6% in September. Only six of the cities had positive annual growth, compared to nine in August

Posted by rob @ 03:18 PM 0 Comments

Slipping towards the junkyard?

Bloomberg: Ireland's Rating Cut Three Levels by Fitch on Banks

"The rating was lowered to BBB+ from A+, Fitch said in a statement in London today as it cut Ireland for the second time in two months. The outlook on the rating, which is three steps above non-investment grade, is “stable,” it said". It’s “an investment grade rating. That doesn’t mean we expect the country to default,” Pryce said on Dublin-based RTE radio. “There is obviously a chance, but that is not our main expectation.”

Posted by alan @ 02:18 PM 1 Comments

AKA yet another side-effect of HPI

Citywire: Women and pensions: won't save or can't save?

I don't normally like Lorna Bourke's pieces in Citywire however this article is a surprisingly candid look at how the younger generation simply don't have sufficient disposable income to consider pension contributions. Certainly, I stopped paying into mine after just two years as I couldn't afford the £150 per month. What does the future hold for this generation as pensioners (although that maybe a contradiction in terms)?

Posted by sibley's b'stard child @ 01:49 PM 6 Comments

Posen vs Sentance

BBC: UK interest rates held at 0.5% by Bank of England

IRs held; no more QE. UK interest rates have now been on hold at 0.5% for 21 months.

Posted by sibley's b'stard child @ 12:56 PM 9 Comments

I wonder if this is in reference to the recent inclement weather???

The Telegraph: House prices drop amid mortgage 'deep freeze'

“Even though lenders slackened their grip on credit in November, it wasn’t enough to change the market’s direction - the mortgage deep freeze is cooling house prices too. It’s not a question of weak sentiment, but lack of loans. If the lenders aren’t freer with finance, prices could stumble again in the new year.”

Posted by inthedelhi @ 12:32 PM 4 Comments

According to a Vested Interest, he did not expect to see a significant fall in house prices further

The Telegraph: UK house prices suffer first annual fall in a year

"Higher numbers of properties for sale, combined with reduced demand, have caused the recent decrease in prices," said Halifax economist Martin Ellis.

Posted by inthedelhi @ 11:42 AM 11 Comments

An acknowledgement that long-term interest rates are rising

THE WALL STREET JOURNAL: Japan Vice Fin Min Sakurai: No Need To Act Now Vs Rising L/T Interest Rates

This is an ultra short article but it is significant because it is the Japanese Finance Ministry that is calling it. I’ll follow it up with a long post on the implications for the UK housing market. They say that there is no immediate need to take action because their interest rates are still behind the rates of competing countries. It is also significant because this is an explicit admission that they intend to gain an unfair trade advantage by manipulating the markets. Personally I think they would not dare to fight the bond market at this stage. They probably think that it’s best to keep their powder dry for a battle they can win, further down the line.

Posted by flashman @ 10:52 AM 27 Comments

Analysis paralysis

Bloomberg: Competing U.K. Indexes Keep Homebuyers Guessing on Market

The seven indexes only agreed on the direction of the market in five of the 22 months through October, according to data compiled by Bloomberg. The last time was in January, when all indicated a price rise. “The huge number of U.K. house price indices creates so much noise that the true picture rarely emerges,” Channon said in an interview. “Unfortunately, they are produced by organizations that release them with their spin.”

Posted by karma4all @ 10:19 AM 0 Comments

Mike Slade says it's time for property investors to 'buy like hell' as Helical Bar raises £29m

Telegraph: It's beginning to look that it is different this time...

'In a vote of confidence in the UK property market, Mr Slade urged investors to "get on the train before it leaves the station". The company on Wednesday placed 10pc of its share capital in a fundraising that is understood to have been heavily oversubscribed. The shares were placed at 270p, a 3pc discount to the previous closing share price.'

Posted by hpwatcher @ 08:51 AM 4 Comments

Falling on all trend measures

LBG: Halifax House Price Index

Annual change -0.7% Quarterly change -2.1% Monthly change -0.1% Average Price £164,708

Posted by dill @ 08:24 AM 28 Comments

Wednesday, December 8, 2010

EU stress tests mess

Bloomberg: Banks in Europe Fail Stress Tests With No Authority

"In the five months after the U.S. published results of its 2009 bank stress tests, the Standard & Poor’s 500 Financials Index rose 25 percent. Five months after the European Union released its version, the Bloomberg Europe Banks and Financial Services Index is down 4 percent." “We were told everybody is fine; there is nothing to worry about. Now their credibility is less than ever.”

Posted by rumble @ 10:55 PM 0 Comments

Could they teach the UK government that trick?

Telegraph: Jim Rogers: 'US government's inflation data is a sham'

"Leading investor Jim Rogers has attacked the US government's inflation data as a "sham" that is causing the central bank to massively understate price pressures". "Everybody in this room knows prices are going up for everything," Mr Rogers told the Reuters Summit.

Posted by alan @ 10:50 PM 5 Comments

Each to his own

Bloomberg: Strauss-Kahn Says Europe in ‘Troubling’ Situation

“The situation in Europe remains troubling and the future is more uncertain than ever.”

Posted by rumble @ 10:41 PM 0 Comments

Calling the rebound

Bloomberg: Half of Americans Say Housing Recovery Is Years Away

"Almost six in 10 U.S. adults say a housing recovery is at least two years away...More than a third of respondents said the rebound won’t happen until 2014 or later."

Posted by rumble @ 10:30 PM 0 Comments

Oh dear...

FT: US Treasuries hit by biggest sell-off since Lehman

US Treasuries suffered their biggest two-day sell-off since the collapse of Lehman Brothers, following a torrid month that has seen borrowing costs for western governments soar. Germany, Japan and the US have all seen their benchmark market interest rates rise by more than a quarter in the past month while the UK’s has risen by nearly a fifth.

Posted by hpwatcher @ 09:14 PM 3 Comments

The next stage for homeownerism

Yahoo News: Tea Party's Judson Phillips Advocates Property Ownership as Voting Prerequisite

I thought that the entrenched interests of the major landowners in the UK were well organised to protect their interests from tax reformers and other sinister individuals but American politician Judson Phillips has exposed our landed gentry as weak and vulnerable. Phillips says 'to just have property owners be able to vote "makes a lot of sense" in a modern setting. His reason? "If you're a property owner, you actually have a vested stake in the community."' Judson Phillips is a genius who has clearly marked out the future for homeownerism. Deny votes to renters and they'll never be able to escape the tax extraction process.

Posted by quiet guy @ 08:36 PM 18 Comments

Have bonds peaked? Mortgage rises on the way

Telegraph: Global bond rout deepens on US fiscal worries

The yield on 10-year Treasuries – the benchmark price of money worldwide and the key driver of US mortgages rates – has rocketed to 3.3pc, up 35 basis points since the announcement of a fresh fiscal stimulus package. This dramatic rise in yields threatens to short-circuit any benefits of stimulus. The bond rout raises concerns that the US authorities may be losing control over events. The Treasury sell-off has ricocheted through the global system, triggering bond sell-offs in Asia, Europe and Latin America. The rise in yields risks becoming a textbook case of a central bank losing control over long-term rates. "Nobody believes that we're slipping into deflation anymore. That phase has passed."

Posted by drewster @ 08:23 PM 3 Comments

Twigs in vases are soooo passe; LED's in dahling

Property Ladder: Does LED lighting make homes more attractive to buyers?

Sorry, saw this and simply had to post it for sheer comedic value.

Posted by sibley's b'stard child @ 04:27 PM 17 Comments

Tax hits youngsters again

Irish Independent: Stamp duty falls but FTB hit

Ireland's woes continue but its the young that get hit hardest.

Posted by chrisch @ 11:31 AM 2 Comments

What the price of gold reveals about UK house prices

MoneyWeek: What the price of gold reveals about UK house prices

As governments debase their currencies, paper money becomes an ever less reliable measure of an asset's true value. For that, we must use a genuine store of wealth: gold. Dominic Frisby looks at the real price of Britain's houses, and where they might go from here.

Posted by damien @ 11:27 AM 31 Comments

One index, one standard?

FTAdviser.com: FTA In Depth: Putting a price on the housing market

The UK's obsession with property has spurned a plethora of house prices indices, each claiming to be a definitive account of the nation's housing market. But with each giving widely differing pictures of the state of the housing market, consumer groups are questioning their validity. The Office for National Statistics (ONS) appears to agree. It is investigating what it called the "coherence and comparability" of house price indices after a number of people confessed being confused by the data.

Posted by jack c @ 10:19 AM 9 Comments

Waving the white flag of surrender...

Estate Agent Today website: Over half of young people say they will never buy a house

Two-thirds said the main reason for this was because they could never afford a deposit.

Posted by rantnrave @ 09:43 AM 11 Comments

Work harder you serfs

Telegraph: Fury over bid to cut pension payments by 25pc

"Steve Webb, the pensions minister, will publish today a consultation on changes that could allow schemes to override their rules and increase payments according to the consumer price index (CPI) instead, which is generally significantly lower. Inflation by the CPI is now 3.2 per cent, but the RPI, which includes mortgage payments, stands at 4.5 per cent. Treasury forecasters expect RPI to average 1.2 percentage points above CPI over the next five years."

Posted by sibley's b'stard child @ 09:37 AM 11 Comments

I did it my way...

Guardian: Iceland exits recession

Last year Iceland's president Olafur R Grímsson said: "The difference is that in Iceland we allowed the banks to fail. These were private banks and we didn't pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks."

Posted by sibley's b'stard child @ 09:30 AM 12 Comments

More froth than a badly pulled pint o' mild...

Guardian: Price of pubs nearly halves in three years as boozers call time

"Punch Taverns – which plunged £160m into the red last year – is said to be thinking of handing back the keys to 6,000 of its 6,800-strong pub estate to cut its £3bn debt. It would be left with just 800 managed houses. The company's shares have fallen from highs of more than £13 in 2007 at the height of the boom to 70p as the industry wrestles with its problems and its debts. Enterprise Inns, which has also been selling pubs, has seen its shares fall from more than £6 to just over £1." Wasn't it UT whom had the plan to buy-up 'distressed' pubs - if so this should interest him?

Posted by sibley's b'stard child @ 09:26 AM 22 Comments

Your chance to make your voice heard to the mighty Martin Lewis :-)

MoneySavingExpert: 50 word Moneyfesto - 2011: Suggest small changes that could make a big difference

campaignPoliticians like to focus on big 'legacy' issues, but miss those little changes that are easily implemented that help make all our lives better. We want your 50-word suggestions on what changes you'd make. The best will go into our MSE 50 word Moneyfesto 2011 that all the party leaders have agreed to look at it, and will go to regulators too. Many of last year's suggestions caused change, either directly or as added pressure.

Posted by mick rupert @ 09:26 AM 0 Comments

Tuesday, December 7, 2010

Don't Bet on Hyperinflation!

Market Oracle: Don't Bet on Hyperinflation!

It seems as if those who keep talking about hyperinflation are claiming it will occur because they read it elsewhere. So who are the propagators of this ridiculous rumor? They are primarily the gold bugs who are trying to manipulate the gold and currency markets. This hyperinflation scare tactic has spread like a deadly virus, infecting the investment decisions of many naïve investors.

Posted by general congreve @ 11:32 PM 13 Comments

Chain reaction or doomed from the start?

The Economist: Don't do it - The euro is proving horribly costly for some. A break-up would be even worse.

Breaking up the euro is not unthinkable, just very costly. Because they refuse to face up to the possibility that it might happen, Europe’s leaders are failing to take the measures necessary to avert it.

Posted by rental john @ 04:01 PM 0 Comments

These guys have withdrawn literally hundreds of Euros!

Sky News: Ooh, Aah! Cantona Fails to Bring Down Banks

Eric Cantona's call for millions of people to "cripple the global banking system" with mass cash withdrawals appears to have had little impact.

Posted by timmy t @ 03:24 PM 22 Comments

One for the conspiracy theorists

Telegraph: Wikileaks: Julian Assange's fatal mistake

At the end of last month, Assange told a journalist he had information about a major US bank that would cause a scandal to rival Enron. It looks like that story will not come out now.

Posted by cyril @ 02:25 PM 22 Comments

Perhaps Eric Cantona will have the last laugh after all.

Zerohedge.com: Bank of Ireland ATM and online systems fail

One of Ireland's biggest banks has issued an apology to customers after a systems failure meant that, for a time, they were unable to access their cash accounts. The Bank of Ireland said it became aware at 1000 GMT on Tuesday that ATMs were not working and customers were unable to make online transactions.

Posted by general congreve @ 01:47 PM 9 Comments

Problems withdrawing cash in NI

BBC: Bank of Ireland ATM and online systems fail

Just a technical issue, or related to the Bank Run?

Posted by metallic @ 01:39 PM 0 Comments

This is not a Michael Jackson song this is real life.

CNN: Welcome to Zombieland: Ladera Ranch, California

Joshua and Irene Vecchione are cleaning the dinner dishes one evening in October when Joshua's cellphone rings. It's Rhea from the Chase collections department, and she wants to know if he has $123,000 today. That's what it will take to get the Vecchiones current on their mortgage.

Posted by mark @ 01:18 PM 1 Comments

Most landlords can't sacrifice rent...

Estate Agent Today: Most landlords will not sacrifice rent, says expert

"“However, those landlords who let more expensive properties to benefit tenants are unlikely to sacrifice the income for the security of direct payments.” He added: “I also believe that the stigma associated with some housing benefit tenants needs to be addressed to attract more private landlords to the market.”

Posted by sibley's b'stard child @ 12:25 PM 4 Comments

Sure to invite some great ideas.

Manchester evening news: Cash-strapped town hall: Tell us how to spend money

Council chiefs are asking Manchester taxpayers where they want their money spent as the town hall plans huge budget cuts. The council has launched a consultation on next year’s budget, saying it is facing ‘challenging times’ and is keen to hear what residents think. Government spending cuts mean local authority budgets face being slashed by more than 25 per cent over four years.

Posted by mark @ 11:18 AM 0 Comments

That's more like it!

Fund Strategy: US housing may not return to 2005 high, says Stein

American house prices may never recover to their 2005 level, according to Gabriel Stein, the chief international economist at Lombard Street Research. Stein says that five years after it peaked the housing market remains weak and on some measures house prices have further to fall. “Until households have managed to bring their debt burden to a level they can live with - and this is far from the case yet - they cannot take on more debt,” says Stein. “But, crucially, even when households have completed their deleveraging, they are unlikely to be prepared to take up debt with the same abandon as the past.”

Posted by mark wadsworth @ 10:16 AM 1 Comments

Possibly the most misleading headline ever

The Move Channel: Paris property prices fall

"Overall the price of non new properties in the Ile de France is up 10.6% on a year ago. This follows a 4.1% rise in the second quarter of the year. The report also shows that none of the 20 arrondissements in Paris have prices at less than €5,000 per meter. In terms of sales Parisian property is back to the average levels the market saw before the economic downturn. "

Posted by mark wadsworth @ 10:15 AM 1 Comments

Same old same old

NZ News: NZ property value slide begins to slow: QV

New Zealand property values fell for an eighth straight month though the rate of decline is easing, which may be a sign the market is beginning to stabilize, according to the government valuer, QV. Values in November were 0.7% ahead of the same period last year, down from a 1.5% gain in the previous month and a 2% gain in September, QV said. Values are now 5.6% below their peak of late 2007.“The rate of decline has slowed in recent months and it appears as if values are beginning to stabilise,” said QV.co.nz research director Jonno Ingerson... the number of house sales remains relatively low and obtaining bank loans “remains difficult for some potential buyers.” At the same time, more houses have been put on the market in the past few months, increasing the stock of unsold pr...

Posted by mark wadsworth @ 10:12 AM 2 Comments

The great bank Ponzi begins to unravel

Independent: HSBC took kickbacks to keep Madoff in business

Slowly it is moving into the public conciousness that the banks are really behind the mess. The uncertainty is IMO growing and the future less clear as the truth emerges.

Posted by chrisch @ 10:05 AM 1 Comments

My re-write of history, Part 1

Guardian: Chronic recklessness powered by unchecked greed

Gordon Brown writes about banking and property....

Posted by alan @ 08:52 AM 26 Comments

Eurozone about to deliver a Lehman-style blow-up

ArabianMoney: Eurozone on the brink of a Lehman-style meltdown

The crisis now enveloping the eurozone is reminiscent of 2008 and the storm that gathered before the collapse of Lehman and the major financial crisis in the autumn. One lesson from 2008 is that once confidence begins to fall in financial markets it quickly develops a momentum of its own.

Posted by peter cooper @ 07:53 AM 0 Comments

Monday, December 6, 2010

Bank run tomorrow, Tuesday 7th December

The Independent: Banks braced as King Eric's day of reckoning arrives

The world's banks will collapse tomorrow when millions of people withdraw their money simultaneously to destroy the system.

Posted by devo @ 09:09 PM 92 Comments

Should Eric have suggested this for tomorrow?

Independent: Need cash? Bypass the banks.........

Not strictly on-topic, but many here complain about low interest rates on their savings, so here goes. Person-to-person lending websites that cut out the middleman/banker are said to be a good deal for both lender and borrower, with the former making over 8% on one site with very little risk.

Posted by icarus @ 08:36 PM 0 Comments

Subprime with egg noodles

Telegraph: China's credit bubble on borrowed time as inflation bites

"The Royal Bank of Scotland has advised clients to take out protection against the risk of a sovereign default by China as one of its top trade trades for 2011. This is a new twist". "Diana Choyleva from Lombard Street Research said the money supply rose at a 40pc rate in 2009 and the first half of 2010 as Beijing stoked an epic credit boom to keep uber-growth alive, but the costs of this policy now outweigh the benefits". "The froth is going into property. Experts argue heatedly over whether or not China has managed to outdo America’s subprime bubble,..."

Posted by alan @ 08:34 PM 0 Comments

More junk and debt!! How will it all end?

Daily mail: Hungary's government debt slashed to 'just above junk status' by Moody's credit rating agency

Credit rating agency Moody's slashed Hungary's government bonds to just above 'junk' grade this morning - and warned it may cut further if the public finances are not put on a sustainable footing. Hungary's government has rejected austerity and aims to close its budget deficit with hefty new taxes on banks and other businesses as well as a diversion of private pension savings into state coffers.

Posted by mark @ 07:58 PM 2 Comments

Lenders need to ensure borrowers have mental capacity

BBC: OFT looking into how lenders choose people who understand completely

"Mental capacity depends on people's ability to learn, remember and understand"

Posted by ontheotherhand @ 04:57 PM 12 Comments

...Slowly slowly catchie monkey..

The Guardian: Global house price rises begin to slow

The rise in global house prices is slowing down, with average annual house price growth around the world falling to 3.1% in the third quarter of the year, down from 4.3% in the previous quarter, a survey shows.Knight Frank's global house price index shows the weakest region in the three months to the end of September was Europe, posting 0.8% house price growth, while Asia-Pacific was the strongest with average growth of 9.9%. For the first time since late 2008, quarterly prices increased in each of the six world regions monitored by Knight Frank (Asia-Pacific by 9.9%, Middle East by 5.1%, North America by 4.2%, South America by 3.5%, Africa by 3% and Europe by 0.8%).

Posted by rob @ 03:13 PM 0 Comments

The danger of fancy charts?

Mail (again!): No end in sight to U.S. economic crisis as 'scariest jobs chart ever' shows post-recession unemployment is at its worst since World War Two

'As US unemployment jumped to 9.8 per cent, it is a chart to chill the bones of any job hunter. Comparing previous recoveries from all 10 American recessions since 1948 to the current financial crisis, the figures show almost no improvement in employment figures in the past year. Some commentators have described the comparison as 'the scariest jobs chart ever', pointing to the fact that only the 2001 recession took longer to bring employment back to pre-crisis levels'

Posted by hpwatcher @ 01:47 PM 7 Comments

But I thought my house was my pension?

Citywire: Aged 50 and no retirement savings? Here's what you need to do

"People pinning their retirement dreams on downsizing their property will be in for a shock,’ Tully warns. ‘A combination of a fall in house prices and annuity rates has dealt a double blow to many, with the average pension pot from downsizing only providing £43.50 a week income. Banking on downsizing to generate sufficient income is a potential retirement disaster unless you have also made provision elsewhere."

Posted by sibley's b'stard child @ 01:30 PM 6 Comments

Tricky Devils!

Telegraph: Court of Appeal £10,800 shock for desperate homeowners struggling to sell

This is one way for Estate Agents to work through the downturn in transactions. Silly sellers to be caught out like that though.

Posted by nomad @ 12:15 PM 4 Comments

So the FED bailed out the BoE (!)

CBS: Fed Chairman Bernanke On 60 Minutes

Fed Chairman Ben Bernanke discusses pressing economic issues, including unemployment, the deficit and the Fed’s controversial $600 billion U.S. Treasury Bill purchase. And about 11minutes into the first half, it is mentioned that the FED splashed money around even to the BoE. Good to know where Merv got some of the resources to keep interest rates artificially low and thus prop up the UK housing bubble.

Posted by sureseam @ 12:14 PM 0 Comments

Landlords taking one for the HPC team

Estate Agent Today: Landlords asked to chop rents for tenants on benefits

“This incentive will bring an overall downward pressure on rents in the private sector. As these rents come down, more properties will become available to claimants and landlords will have certainty that their income will be protected.”

Posted by sibley's b'stard child @ 11:13 AM 1 Comments

A charter for nimbys, or real freedom?

Daily Mail: Need planning permission? Do it yourself as planning laws are overhauled

Homeowners will have greater say over developments in their neighbourhoods under an overhaul of planning laws. The changes could pave the way for householders to improve their homes without interference from officials. But there are fears that it could also be a charter for Nimbys – Not In My Back Yard protesters – as residents will also have the power to block large developments in their areas. The plan could decree rules for home improvements such as extensions, conservatories, loft conversions, driveways and wind turbines. But decisions over large-scale developments such as new blocks of flats, schools and other public buildings may also be handed to residents.

Posted by drewster @ 11:12 AM 3 Comments

Winter cold weather shocker blamed for poor sales...

Guardian: Cold snap chills retailers' bottom lines

"Britain's arctic weather cost UK retailers millions of pounds in lost sales last week as the most important shopping weeks of the year got under way."

Posted by sibley's b'stard child @ 10:53 AM 3 Comments

Take stick. Poke hornets' nest. Run.

Telegraph: What's behind the 2010 gold rush?

"And as gold closes in on a 10th straight year of gains, a debate is raging across the country on whether the longest rally since at least 1920 can last."

Posted by sibley's b'stard child @ 10:50 AM 11 Comments

Finance ministers meeting on Monday face pressure to increase the size of a 750 billion euro

Yahoo: Euro ministers under pressure to boost rescue fund

International Monetary Fund chief Dominique Strauss-Kahn will call on ministers to boost the rescue pool and urge the European Central Bank (ECB) to step up its purchases of bonds to stem the crisis, according to an IMF report obtained by Reuters.

Posted by mark @ 10:29 AM 5 Comments

All aboard, all aboard...

Telegraph: Ben Bernanke says QE3 'certainly possible'

'More quantitative easing in the US is "certainly possible", Federal Reserve chairman Ben Bernanke said in a rare television interview on Sunday, as he defended the central bank's latest measures to help the US economy and didn't rule out taking more. Mr Bernanke said that critics of the Fed's move to inject a further $600bn into the economy by buying US government debt were not "looking at the risk of not acting." Critics fear the move will fuel inflation and fail to lower unemployment, which the Fed has said is a central aim.'

Posted by hpwatcher @ 08:49 AM 19 Comments

The system is überfordert, unable to cope.

FT: A hopeless Europe, unable to cope

The euro is currently on an unsustainable trajectory. The political choice is either to retreat into a corner, and hope for some miracle, or to agree a big political gesture, such as a common European bond. What I hear is that such a gesture will not happen, for a very large number of very small reasons. The system is genuinely überfordert.

Posted by devo @ 12:35 AM 1 Comments

Sunday, December 5, 2010

Global decline

FT.COM: Recovery in global housing market losing steam

The global recovery in house prices slowed in the third quarter of 2010, with more than half of the countries that have developed housing markets seeing fresh falls after values rebounded from the 2008 crash.

Posted by the green manalishi @ 11:35 PM 0 Comments

Wikileaks: African countries prefer Chinese aid

Guardian: Wikileaks: African countries prefer Chinese aid

According to the Kenyan ambassador to Beijing, Julius Ole Sunkuli, China’s focus on producing tangible results with its investment and development programs are far more preferable to many African governments. He said he saw no concrete benefit for Africa in even minimal cooperation. Sunkuli said Africans were frustrated by Western insistence on capacity building, which translated, in his eyes, into conferences and seminars (REF C). They instead preferred China’s focus on infrastructure and tangible projects. So.that 8 billion ish of international aid isn't doing what it is suppose to do at all..

Posted by easybetman @ 11:00 PM 2 Comments

Are we safe from a Euro collapse

Telegraph: Default, delusion and deceit (and other ways to spring the debt trap)

There are five ways of escape ... The fifth way is to default. Perhaps you can make someone not involved in the process by which the government gets elected take a good part of the hit. This is where Johnny Foreigner comes in. You say: "Sorry old chaps, but that money that you thought we owed you is now 'restructured'. In the words of Monty Python, it is an ex-loan." This is what is going to happen. Huge amounts of money are going to be lost. At the moment, the prospective losers can afford it. But coming up in the lift are Portugal, Belgium and Spain. And then Italy.

Posted by quiet guy @ 10:43 PM 10 Comments

The Communist Party learned from Tiananmen in 1989 how surging prices can seed dissent

Yahoo: China's credit bubble on borrowed time as inflation bites

The Royal Bank of Scotland has advised clients to take out protection against the risk of a sovereign default by China as one of its top trade trades for 2011. This is a new twist.

Posted by mark @ 07:02 PM 4 Comments

QE3 to tackle deflation.....

Daily Telegraph: Bernanke’s QE3 faces stiff resistance

Ben Bernanke, chairman of the Federal Reserve, was expected to open the way for a third blast of bond purchases in a 60 Minutes interview, but any such move is likely to face resistance from Fed hawks and mounting criticism in Congress.

Posted by tom101 @ 06:53 PM 4 Comments

Ireland's most expensive houses fall the most

The Guardian: The roof falls in on Ireland's Millionaires Row

I wonder if this could happen in London?

Posted by cyril @ 03:04 PM 8 Comments

Momentum building

Guardian: Mortgage benefit cut that means thousands will lose their homes

Many unemployed homeowners face repossession in the new year as the 40% cut in the Support for Mortgage Interest rate begins to bite

Posted by the green manalishi @ 09:43 AM 0 Comments

Hedge fund king says buy US housing

ArabianMoney.Net: Hedge fund manager John Paulson says buy US homes

The hedge fund manager who made billions betting against subprime mortgages is now advising people to buy homes in the US as a hedge against inflation and a falling dollar. John Paulson is a man to follow with your check book. He reckons that if you own one house in the US you should be buying a second, and if you own two then buy a third. Why is he saying this?

Posted by david smith @ 05:16 AM 0 Comments

Saturday, December 4, 2010

Once something looks like a crisis it becomes a crisis

Global Financial Strategy: British Bankers' Association warns of Cantona inspired crisis

A plan hatched by ex-footballer Eric Cantona for a mass run on the banks [Tuesday 7th December] could cause a financial "crisis", the British Bankers' Association has admitted. The UK trade body warned that the direct action revolution promoted by the French former Manchester United striker risks a new Northern Rock "if enough people" withdraw their savings. "I don't understand what benefit there would be in trying to crash the banking system," a BBA spokeswoman said. "You would very quickly get into a Northern Rock situation if everybody wanted their money at once. It wouldn't take very long before you get queues and then you would get camera crews. "Once something looks like a crisis it becomes a crisis."

Posted by devo @ 10:33 PM 10 Comments

Cash machines are running out of money

Telegraph: Cash machines are running out of money due to snow

Reportedly due to snow, but is the Bank Run having an effect?

Posted by metallic @ 05:10 PM 0 Comments

Bang'em up

Gulled by Special Offers - What about house prices

BBC News - Business: We're all gulled by special offers

Here Robert Peston opines about The Advertising of Prices, by the Office of Fair Trading, the competition watchdog - yet nowhere is there any mention about House Prices and how these 'products' are sold and regulated. Most would agree that houses are not only our most expensive purchase but the 'product' description, re-listing of houses as 'new', price 'reductions etc, etc are at the very best pretty misleading and at worst down right cobblers.

Posted by blackers @ 12:51 PM 0 Comments

Poor little rich mum

Daily Mail: Merry Christmas? Along with millions of other middle class mothers, I can't afford one

Five years ago, I earned £1,200 a week and would have thought nothing of spending £45 on a jar of body cream for a distant relative. Like many thousands of families across Britain, I have experienced a dramatic downturn in my ­fortunes in the past year or two. I may be middle class, but I’m poverty-stricken. How did this happen? My partner and I borrowed and borrowed and bought a country house alongside the two we owned between us in London. When the recession hit, we realised the value of our properties had slumped and we were largely in ­negative equity. Many of my friends are in quiet despair. One girlfriend told me that she’d planned to spend only £50 on her 15-year-old daughter. The idea of having to disappoint my six year old makes me feel sick to my stomach.

Posted by little professor @ 08:22 AM 40 Comments

Loss of confidence can wreak huge damage

Bank run Tuesay 7th December: Eric Cantona: can his protest actually work?

The hope is the system will collapse in favour of a new "citizen's bank" that would "put our money away from speculative fever, free of all financial bubbles designed to burst one day, free of operations that transform our loans & assets and use our debt to buy other assets. The... key point is that in reality our "savings" do not sit idly in banks but are lent out or invested elsewhere, so banks are simply in no position to hand out all their depositors savings in one go.

Posted by devo @ 08:18 AM 16 Comments

Friday, December 3, 2010

Badly priced debt

A HPC could soon be a self-fulfilling prophecy.

The Telegraph: House prices may fall another 10pc

IHS Global Insight and Capital economics think there will be house price falls of between 6 and 10% by the end of 2011. This is good news and means the FTB's amongst us should put off buying any purchase until average prices are around 150k, or at least negotiate a discount to take these falls into account.

Posted by miken @ 08:48 PM 8 Comments

Germany abandoning the Euro: Hint, warning or threat...

Guardian: Angela Merkel warned that Germany could abandon the euro

German chancellor said to have made comments during an EU summit dinner in Brussels at the end of October Nothing like a bit of gossip.

Posted by tom101 @ 06:21 PM 8 Comments

Feed me, FEED ME!

Telegraph: Berkeley profits up as it pleads for looser lending

The UK's second-largest homebuilder by market value said pre-tax profits were up 18.5pc to £61.6m for the six months to October 31 2010. Revenue rose 15.9pc from £290.1m to £336.2m. The homebuilder’s focus on the south east of England enabled it to benefit more from the recovery in demand than some of its competitors. The group sold 1,249 homes in the first half compared with 914 a year earlier.

Posted by dill @ 06:12 PM 0 Comments

More tax grabs... Our masters giveth then they taketh away...

Daily Telegraph: 700,000 more to pay higher-rate tax

More than 700,000 people will pay a higher rate of income tax after the Treasury confirmed it was lowering the threshold at which the 40 per cent rate is levied.

Posted by tom101 @ 05:32 PM 1 Comments

Interesting statistic

The Move Channel: Demand for new approach to housing finance

"Recent statistics from the Council of Mortgage Lenders have shown that the number of first-time buyer mortgages has dropped by 90% over the last few years, excluding many first-time buyers from any hope of homeownership." The rest of the article is the usual shroud waving and special pleading.

Posted by mark wadsworth @ 01:36 PM 2 Comments

"Crippling housing costs"

Daily Mail: So why are record numbers of grown-up sons and daughters moving back in?

"There was a time when ­teenagers couldn’t wait to fly the nest, scurrying off to ­university or moving into shared rented accommodation with friends while they saved to buy their first home. But new statistics show that record-breaking numbers of adults are back living with their parents, unable — or in some cases unwilling —to take on Britain’s crippling housing costs. Government figures have revealed that an increasing number of young men and women are becoming ‘children for life’. The proportion of men in their 20s living at home has risen from 59 per cent to 80 per cent in the past 15 years, while the number of women has risen from 41 per cent to 50 per cent. "­

Posted by mark wadsworth @ 01:26 PM 18 Comments

Make me a cuppa while you're at it, love...

Morning Star: Tories tear up equal pay law

"The government scrapped legislation today that would put a legal duty on employers to disclose whether they pay women less than men. Business organisations rejoiced at Equalities Minister Lynne Featherstone's decision not to enact Labour plans to extend mandatory gender pay reporting to private companies with 250-plus employees. Employers will be left to police themselves about whether they are breaking equal pay law - despite clear evidence that the voluntary approach has failed."

Posted by sibley's b'stard child @ 12:00 PM 19 Comments

A home to live in, or a speculative purchase?

Bloomberg: London Luxury-Home Values Rise as Euro-Region Buyers Seek Haven

"London luxury-home values rose in November for the first time in five months as the debt crisis in the euro region prompted more buyers to compete for a dwindling number of homes for sale, Knight Frank LLP said".

Posted by alan @ 11:21 AM 4 Comments

The only thing that can stop house prices from falling – more QE

MoneyWeek: The only thing that can stop house prices from falling – more QE

A steep fall in house prices is not what the politicians want. It wouldn't do the banks any good, either. But the only way to stop it is another bout of quantitative easing.

Posted by damien @ 10:01 AM 104 Comments

They might do better to wait for further falls in house prices

The Daily Telegraph: Return of the 90pc mortgage raises questions for first time buyers

Ian Cowie thinks that house prices are going to fall further. He obviously hasn't cleared this with the Telegraph's property journalists. Why would I want to take a highly leveraged position in an illiquid asset that is falling in value, however low the interest rate is?

Posted by monty032 @ 09:36 AM 4 Comments

Bank run on Tuesday 7th December

The Wall Street Journal: French Officials Warn Against Bank-Run Proposal

Bankers and politicians warned against a plan inspired by French former football star Eric Cantona to spark a bank run next week, saying that such a move would be counterproductive. The plan—which calls on depositors to remove their money from banks on Tuesday—has attracted increasing attention in recent days, drawing comments from French financial leaders. "The recommendation to withdraw deposits is totally irresponsible," said BNP Paribas CEO Baudoin Prot. It also went "completely against anything that could assure the functioning of the economy," he told reporters Thursday

Posted by devo @ 06:41 AM 14 Comments

Thursday, December 2, 2010

Hedge funds are too big to fail

FT: If you would like to redistribute this article please respect FT.com's ts&cs and copyright policy which allow you to: share links; copy content for personal use; & redistribute limited FT content. Email ftsales.support@ft.com to buy additional rights. htt

The US Federal Reserve lent billions of dollars to hedge funds as part of its emergency liquidity programme during the financial crisis, data released by the central bank show. Against growing regulatory pressures, a favourite industry rejoinder has until now been the widely held belief that hedge funds avoided taking taxpayer money and had not, unlike many banks, had to be bailed out. According to Fed data, however, $71bn of loans were made through its term asset-backed securities loan facility (Talf) mostly to non-bank institutions. They included hedge funds run by managers including FrontPoint, Magnetar, and Tricadia, many of which reaped handsome rewards from the collapse of the housing market.

Posted by devo @ 10:37 PM 9 Comments

Just when you thought.........

RTE News: The FT says Irish banks are among the most exposed to the PIGS

Irish banks' dodgy loans aren't limited its own property bubble. They loaned huge amounts to the PIGS' banks, companies and governments and this gives rise to concerns that the interrelationship between the troubled nations of Europe is more deep-seated than many realise and that the risk of contagion is high.

Posted by icarus @ 08:23 PM 14 Comments

Distressed Debt - what is the longer term answer?

WSJ - Online: ECB Extends Special Liquidity Measures

The European Central Bank has abandoned its plans to wind down emergency support for banks and government debt markets, responding to concerns that an early exit from such programs could jeopardize the euro currency.

Posted by alan @ 05:32 PM 3 Comments

Handbags!

Mortgage Strategy: NAEA hits out at self-serving lenders

The housing market recovery is being threatened by self-serving and stubborn mortgage lenders, the National Association of Estate Agents warns. Peter Bolton King, chief executive of the NAEA, is warning that any recovery will be strongly dependent on the major lenders making mortgage finance more available. He says: “The housing market remains in a state of fragile recovery as the year ends. Frankly, however, this recovery is threatened by the stubborn refusal of major lenders to loosen their self-serving restrictions on mortgage lending. “A historically low rate of interest has benefited those people who already have a mortgage, but it is likely that over the next 12 months it will rise..."

Posted by mark wadsworth @ 03:04 PM 10 Comments

They get away with it again

Bbc: RBS cleared of wrong doing

18 months to say no wrong doing....they didn't even ban goodwin and hornby as directors...this crisis will never be over until punishments fir the crime...government even want to prop directors up...unbelievable...what message does this send out?

Posted by taffee @ 02:55 PM 6 Comments

Maybe sensible rather than scared?

Cnn: Perfect time to buy a home - but we're too scared

Despite some of the best home-buying conditions in years -- affordable prices, low interest rates and lots of choices -- fear of buying has infected the market. It has paralyzed house hunters, making them unable to pull the trigger even on attractive deals. Some are worried about making the payments, while others are convinced they'll save even more if they wait.

Posted by mark @ 12:57 PM 5 Comments

Barclays solid as a Rock.......looks like they need more free fed money

FT: BarCap to cut hundreds of jobs as revenues fall

Barclays Capital, the investment bank that has expanded rapidly since the financial crisis, is set to cut hundreds of jobs in the UK following a sharp slowdown in revenues. The redundancies, which will affect front-office bankers and traders as well as support staff, are on top of the 300 staff the bank let go in August after a disappointing second quarter.

Posted by hpwatcher @ 12:15 PM 12 Comments

What the average house price will buy you around the UK

For the first time more small firms go bust than are set up

Daily mail: How 1,100 businesses collapse every day

More than 1,100 businesses collapsed every working day last year, official figures revealed yesterday. The record number of ‘business deaths’ shows how severe the recession proved to be, with 279,000 firms going under in 2009. That is highest level since Office for National Statistics records began a decade ago. Around one in eight businesses closed down over the year.

Posted by mark @ 10:49 AM 3 Comments

It's the Sun what made it!

The Sun: UK Manufacturing Makes a Recovery

THE manufacturing sector is growing at its fastest pace for over 16 YEARS - in a huge boost to the British economy. Staggering figures yesterday showed export orders were flying, with firms picking up business in Germany, China and the Middle East. And staffing levels were up by the biggest amount since current records began in 1992.

Posted by alan_540 @ 10:00 AM 6 Comments

Barclays solid as a Rock

The Telegraph: UK banks borrowed more than $1 trillion from US Federal Reserve

British banks borrowed more than $1 trillion from the Federal Reserve during the financial crisis, led by Barclays

Posted by devo @ 06:42 AM 15 Comments

Wednesday, December 1, 2010

But they won't change IRs

Telegraph: Bank of England 'hard-nosed' about tackling inflation

"The Bank of England is "as hard-nosed as ever" about keeping inflation under control despite overshooting the 2pc target for much of the past four years". Usual rubbish about being tough on inflation which monotonously turns up a week away from all IR decisions.

Posted by alan @ 10:05 PM 26 Comments

3 generations of surveyors buy the same property

Country Life: The Price of a Country House Then & Now

Great comparison of the multiples of salary required by three generations of chartered surveyors to buy the same house over 100 yrs.

Posted by nick mac @ 04:31 PM 0 Comments

Demand for rental properties increasing along with prices...

Guardian: Lettings sector on a high as rental demand soars

Demand for properties to rent increased at the fastest pace since 2008 in the three months to the end of October, while supply of new property to the lettings market fell for the fifth consecutive quarter, resulting in soaring rental growth. Next door has been vacant for a year and a half.... Quite a few people i know have sold to rent over the past three months, but i'm pretty sure the prices i have seen have gone down.

Posted by tom101 @ 03:22 PM 33 Comments

Martin Gahbauer's untruth of the day

Telegraph: You ain't seen nothing yet: why house prices could fall by another 20 per cent

From the article: "there are significant differences between the current situation and the past: “Although the house price to earnings ratio is currently above its long-run average, it is possible that the equilibrium level of the house price to earnings ratio is higher than the long-run average level would suggest. “Factors that could argue in favour of a higher equilibrium level are a much lower level of real interest rates than in the past, and a higher proportion of households with more than one earner." From the ONS: overall employment rates for women increased since 1959, but the rate for men went down in equal and opposite measure. Overall employment rate is barely changed. http://www.statistics.gov.uk/articles/labour_market_trends/Trends_in_female_employment_nov2002.pdf

Posted by mark wadsworth @ 03:09 PM 4 Comments

Reggie Middleton Outlines Irish Default Scenario

Reggie Middleton Boom Bust: Ireland's Inevitable Default

Apologies to any grupmy-drawers who don't like financial blogs. There has been some discussion of the Irish bailout recently so this seemed relevant to the general economic mish-mash we are witnessing. Reggie Middleton is convinced Ireland will default on its debt and outlines a case for why the bailout made default more likely rather than less likely. Nice graphs too.

Posted by fubar @ 01:58 PM 4 Comments

Should he stay or should he go?

Wiki: Mervyn King urged to resign after admitting Cameron 'concerns'

Pressure is mounting on Mervyn King after a former colleague called for him to resign as Governor of the Bank of England and Downing Street declined to back him over disparaging comments he allegedly made about David Cameron.

Posted by alan @ 01:27 PM 7 Comments

The rat was caught jumping ship before it sank

Guardian.co.uk: Mervyn King must go

Branchflower sums it up nicely: 'During my time on the Monetary Policy Committee (MPC), King made it abundantly clear that members should not comment on fiscal policy and should stay out of party political matters. He has failed to follow his own advice. How could Ed Miliband or Alan Johnson ever trust King to give them advice on economic policy, now he has shown his true party political colours? Once independence has been compromised it can never be restored.'

Posted by ra02127a @ 01:05 PM 0 Comments

The NW report according to the dark-side...

Estate Agent Today: House prices stutter downwards again in November

"House prices fell by 0.3% in November, the Nationwide reported this morning, bringing down the average price to £163,398. It means that gains made in the earlier part of this year have all but been wiped out, with prices now standing at just 0.4% higher than this time a year ago."

Posted by sibley's b'stard child @ 11:34 AM 0 Comments

Guff from Gahbauer

Daily Telegraph: Buyers could face double squeeze as house prices fall again

The article esentially says that he thinks seller could retreat because they think the prices are weak and seller will decide not to sell and wait for the spring. This he assumes will stop the decline in house prices. Concurrent is the fact that lenders are going to lend less due to the miserable state of finances and the less than cheery outlook. All of this means the assumed desparate house buyer will have less to choose from when buying and less money to but it with. My view: The market is poised for a crash since if people find themselves in the position of increased interest rates (for the reasons above) and falling incomes (the upcoming cuts) they will HAVE to sell if they like it or not to reduce debt.

Posted by growler @ 11:29 AM 14 Comments

Price bubble led to ruin

Newsletter.co.uk: Price bubble led to ruin

Great piece of sensible [finally] journalism: "Why was it good news for the younger generation either to be shut out of home ownership or condemned to decades of huge debt so that the older generation would grow rich in their homes? The myth that 'you can't go wrong with property' encouraged many young people to blunder into disastrous purchases."

Posted by doomwatch @ 11:21 AM 2 Comments

Worth a read, it is a PDF

Las Vegas Sun (PDF): Metro Economic Performance Rankings, Pre-Recession (1993-2007), Recession (2007-2010), and Recovery (2009-2010) Periods

Aggregate views of the global economy, however, mask the distinct experiences of its real hubs—major metropolitan areas. Metro areas, which are economically integrated collections of cities, suburbs, and often surrounding rural areas, are centers of high-value economic activity in their respective nations and worldwide

Posted by mark @ 11:01 AM 6 Comments

How to make friends and influence people

CNN: WikiLeaks' next target: 'A big U.S. bank'

I bet it is Citi bank. WikiLeaks' founder claims he has the goods that could take down a big U.S. bank

Posted by mark @ 10:53 AM 15 Comments

Can they, well can they, do tell

Yahoo: Can the eurozone afford to bail out many more countries?

With Greece receiving €120 billion over three years and Ireland’s €85 billion all but done and dusted, currency specialists HiFX sums up the size of the potential bail-outs for the other ailing countries like this: *Portugal: €100 billion - markets seem intent on driving Portugal into a bail-out. *Belgium: €50 billion - a mere drop in the ocean *Spain: €270 billion-€400 billion - potentially "too big to fail and too big to bail" *Italy: €500 billion-plus - too big to consider.

Posted by mark @ 10:22 AM 6 Comments

Ben Lowry - a serious journalist

Belfast News Letter: HPs down 41%

Our 'survey of the surveys' gives a comprehensive picture of where house prices presently stand, more than three years after they peaked. Read also the two linked articles

Posted by financial planner @ 10:14 AM 2 Comments

Embarrassment for the man who helped bring financial instability to the UK

Telegraph: Bank chief's 'great concerns' for David Cameron and George Osborne

'Mervyn King told the US ambassador to London, Louis Susman, earlier this year that he was worried about the Conservative leadership’s “lack of experience”. The disclosures could test the relationship between Mr King and the Prime Minister and his Chancellor. Labour is sure to exploit the embarrassment at Prime Minister’s Questions later today.'

Posted by hpwatcher @ 08:28 AM 15 Comments

Still declining - the BBC reluctantly admits

BBC News: House prices fall again in November, says Nationwide

Still a lot of support for the idea that the problem is a presently-created one. The CML mantra that it's the "mortgage rationing" that is causing the problem rather than the mortgage glut that caused it.

Posted by growler @ 07:34 AM 4 Comments

November Index

Nationwide: -0.3% MoM +0.4YoY

"Commenting on the figures Martin Gahbauer, Nationwide's Chief Economist, said: “The recent trend of modestly falling house prices continued during November, with the price of a typical UK property declining by 0.3% on a seasonally adjusted basis between October and November. The three month on three month rate of change – a smoother measure of the recent price trend – rose from -1.5% to -1.3%. This remains well above the deeply negative rates of -5% to -6% that prevailed during the most severe phase of the downturn in 2008. The annual rate of change – which compares house prices to their level 12 months ago – fell from 1.4% to 0.4% and suggests that house prices are essentially unchanged from a year earlier."

Posted by phdinbubbles @ 07:22 AM 20 Comments

Bank of England, Mervyn King, political interference

The Guardian: Mervyn King had doubts over Cameron and Osborne

Mervyn King told the US ambassador, Louis Susman, he had held private meetings with the two Conservative politicians before the election to urge them to draw up a detailed plan to reduce the deficit.

Posted by devo @ 12:00 AM 2 Comments

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