Thursday, March 3, 2011

Hometrack: -0.2%MoM, -2.7%YoY

Feb house price fall biggest in a year - Hometrack

House prices in England and Wales fell at their fastest annual rate in more than a year in February, although a rebound in new buyers slowed monthly rate. Hometrack said prices fell 0.2 percent in February, the smallest monthly decline since July. However, the data are not adjusted for seasonal fluctuations, and Hometrack said the improvement could be due to a mix of seasonal factors and pent-up demand after weakness at the end of 2010. Indeed, on an annual basis, house prices fell 2.7 percent last month -- the biggest fall since November 2009.

Posted by little professor @ 08:45 AM (2033 views)
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25 thoughts on “Hometrack: -0.2%MoM, -2.7%YoY

  • Thegreenmanalishi says:

    Rebound in new buyers – surely most of the people putting their homes on the market are also registering as new buyers too.

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  • sibley's b'stard child says:

    Lovely, looks like Hometrack is the more reliable index than Halifax/Nationwide of late.

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  • I’d still say Nationwide is accurate despite Tuesday’s epic 85 comment marathon.

    I posted a comment on that thread (but stupidly forget to enter my admin password, so it’s still somewhere in the ether) basically saying that Nationwide’s Non-Seasonally Adjusted series has posted 7 negative monthly figures in the last 8 (and the only +ve month was +0.15%). Further, the Nationwide number for Feb 2010 (yes, 2010, not 2011) was a statistical outlier (look at their Average prices in early 2010, the Feb number is absolute [email protected], it dips WAY below the months surrounding it), making the Feb 2011 YoY number nonsense.

    Check the Nationwide NSA YoY figures coming up in March and April 2011, believe me it will be more negative ……….. if NSA prices stay FLAT in March, the YoY goes to -2%, if they stay flat again in April, the YoY goes to -3.9%, flat in May = -4.7%, flat in June = -5.3%…………… and all this happening during a period where mortgages rate may rise, unemployment WILL rise, etc………….. have faith, she’s still ticking downwards………… and remember the Seasonal Adjustment factor ADDS in winter, but SUBTRACTS in spring (I.e. March and April)………… so the Nationwide figure which the Daily Mail readers get next month may well be negative…………

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  • mark wadsworth says:

    As SBC says, the Hometrack index is very reliable this month.

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  • Thanks for the number crunching ana lytics.

    It makes me feel better for making the decision to go on renting a little longer.

    It doesn’t stop me watching the buying frenzy that seems to be commencing.

    The fundamentals you list point down on houseprices not sure the population (around me anyway) are paying much attention.

    At least as you say they’ve got quite an uphill battle to keep the monthly figures positive this spring.

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  • hm, it looks a good decision to get another year of renting…

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  • phdinbubbles says:

    -2.7% YoY. Isn’t that the net yield of yer typical BTL? When will BTLers realise and stop piling in? When will the ever growing ‘wait until the market recovers to sell’ set start to think it might be a good idea to off-load? When will people stop accepting losses in the hope of things picking up? 5 weeks? 5 years?

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  • mark wadsworth says:

    Ana Lytics, splendid stuff.

    In the spirit of things, let’s just focus on the distinct downward trend of the last six months, which is the post-dead cat bounce phase. The YoY is meaningless.

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  • phdinbubbles says:

    The nationwide month-on-deadcatzenith figure is -5.25%.

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  • sibley's b'stard child says:

    Nice one Ana; you specialise in reasoned stastistical analysis; I ‘specialise’ in glib one-liners.

    That looks much nicer Phd (than recent indices), i’ll take that.

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  • notyethomeless says:

    Hooray! I think…

    So if prices stay the same, then the annual trend is down. ?? My head spins.

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  • @9 NYH – Yes, because prices were increasing this time last year.
    @7 PHD – Please elaborate! Is this some data set I’ve missed out on. I am also tracking where things are re the DCB.

    I have to say that although this particular report set gets much less media coverage, I find it refreshingly short on seasonal adjustments, revisions to last month’s data etc.

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  • @4 str2007: Yep, the data and public’s appetite for housing is disconnected I agree. But hopefully rate rises (MPC or otherwise) will dovetail with the -ve YoY and that SHOULD penetrate the Mail/Express reader’s skull………

    And you mention a “buying frenzy”? Really? quite suprised by that, but nothing really suprises me when it comes to the UK’s appetite for property.

    @8 sbc: glib is good.

    @9 notyet: Yep, and there’s even better news. Even if March 11 is a small +ve increase, we could see the YoY go down. It’s all about the relative measurement between the March 10 and March 11 monthly numbers…………E.g. month of March 11 could post +0.98%, but if March 10 (which drops out of the YoY in March 11) posted +1.98% (which it did on the NSA measure), then the net overall effect is -1% on the YoY…….. the wonders of statistics eh?

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  • The data is positive and i agree with you guys – when the spending cuts kick in with the tax rises and hopefully interest rate rises… we should see a more steep decline in property prices… i suspect that inflation will take most of the losses for these people – but the mentality that property is ‘your pension’ must go too… it just seems to be lingering like a bad smell…

    This constant talk of recovery – sell in a few years when things are back up just seems crazy but everyone seems to believe it!

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  • phdinbubbles says:

    @rnr
    It’s nothing fancy. The last Nationwide figure of £161183 is 5.25% less than the June 2010 peak of £170111.

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  • There doesn’t seem to be a buying frenzy in Dundee. Just heard that a friend of a friend who is trying to sell her deceased mum’s property has only had two viewings since she put it on sale last August. Yet it’s apparently a nice little place in a popular location, really handy for the huge main teaching hospital. The first viewer put in an offer which was refused as being ‘cheeky’ and ‘trying to rip us off’ ie maybe it was realistic! She says well it’s not costing us anything to hold on to it so we’ll just wait until things improve. Multiply that attitude over the country and you get the picture..

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  • There’s no buying frenzy round here either. Work colleague is due to retire and relocate to be closer to kids. Has his house on the same as he bought it for in ’06. Not a single viewing in four months.

    Anyone else notice the line in the report about record numbers of new instructions – pent-up supply then!

    @12 PHD – Are we closer to prices at the start of the DCB or to the peak of the DCB? How much more drops do we need to be lower than the previous trough?

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  • phdinbubbles says:

    @a saver
    Is she not paying council tax on the house and is she not maintaining and insuring it? Holding on to a house until the market picks up has certainly been a dominant attitude for the last couple of years, but it’s sureley a logical paradox (If we all refuse to sell our houses then we can all sell them at a higher price!)? What happens when the growing numbers of deferred sellers decide they want to try and sell? What happens when someone else in the street decides to sell at 25% less than peak (not unrealistic, given that the vast majority of homeowners have little or no mortgage debt) because they’re not that greedy?

    Or can the low volumes go on forever? Will people put up with low yields and small losses forever? They probably will if they’re british and it’s a house (I’ve got more houses than you, etc).

    @rnr
    The Nationwide’s got another 8.35% to fall from it’s current level before it’s back down to the previous trough. Still some way to go before kitty’s given a death certificate.

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  • mark wadsworth says:

    RNR, Nationwide average before DCB was £147,000 in February 2009 (see here, the DCB took us up to £170,000 by June 2010, and since then prices have been going down again, so we are still about ten per cent above previous low (and only about five per cent below the peak of the DCB).

    My G-d, it’s like watching paint dry. Except a lot slower.

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  • phd @15, council tax is not an issue, the would be seller mentioned that the house is empty hence no (or v little?) council tax.
    I for one would like to see an end to this climate of making it so easy to hang on to an empty house (although the mortgage was paid off years ago so there’s no low-interest mortgage to pay in this case) and the still-widespread attitude that you’ll make tens of thousands more if you just wait a bit as the market should always go up. Actually if IRs were in a decent place you might think twice about having an asset worth say 160k sitting doing nothing and requiring some upkeep as you’d be foregoing 8K a year gross at 5%.

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  • phdinbubbles says:

    @a saver
    As far as I’m aware, council tax is normally exempt for the first six months of a house being empty (if she put it up for sale in August, then that’s over 6 months ago), but there may be a slight discount (can be up to 50%, but I think this is rare) if it is still empty after the 6 months or a further six months exemption if the house is intended to be let but uninhabitable due to work in progress.

    Any rise in IRs would certainly help the difference between the meagre yields on property and safer places (with less hassle) to stick the cash.

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  • House prices are dropping here in Dorset > F>A>S>T……….more than these figures show.

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  • @PHD / MW – How do the DCB stats compare using the other common indices? The Nationwide trough of 147K seems to have been a one-month phenomenon.

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  • phdinbubbles says:

    @rnr
    Halifax needs to fall 3.4% and LR 6.4% to get back to their troughs. The troughs were all a bit different (as well as what they’ve done since):

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  • mark wadsworth says:

    @ PhD and A Saver, now, if only we could think of a tax or levy which would discourage people from leaving homes vacant for long periods of time… hmmm.

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