Monday, May 9, 2011

-1.4% MoM -3.7% YoY

April Index

Commenting, Martin Ellis, housing economist, said: "The latest figures show that the underlying trend in house prices continues to be one of modest decline. Prices in the three months to April were 1.2% lower than in the previous three months. There was a 1.4% fall in prices in April following no change in March."

Posted by phdinbubbles @ 08:10 AM (6512 views)
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28 thoughts on “-1.4% MoM -3.7% YoY

  • I wouldn’t call it a ‘modest decline’. Last years spring bounce appears to have been replaced by this springs downward momentum

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  • techieman says:

    PHD graph graph graph……….Flash….. 3rd / C wave down? And where are we on the [un]employment correlation front? One swallow doesnt make a summer, but starting to look like it farquaharsens a spring. Musat dash Flash… hope everything is fine and dandy with you.

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  • hpwatcher says:

    Spring bounce anyone?

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  • Welcome back techie. You’ve been missed. The unemployment correlation only SUGGESTS that we wont have a balls out crash unless the numbers match but that doesn’t count out a slow drift caused by other fundamentals.

    In my opinion the buyers haven’t really joined in yet because they still want to pay silly prices. The banks and their surveyors are currently refusing to fund the silly amounts they would pay if left to their own devices. If the buyers finally understand that prices are silly, we might see some more serious downward momentum

    Sorry, I can’t go along with this third wave stuff 🙂

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  • phdinbubbles says:

    Working on the graph – the script’s on my dead laptop’s hard drive so might be a while and might not look too good for this month as it plots the NSA, which, according to the Halifax, is up from £162,151 in March to £162,303 in April. However the annual fall, derived by comparing this April with April 2010, is 5%.

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  • techie: Just to clear up any misunderstandings about those correlation numbers. They suggest that house prices will slowly drift downwards as we get close to the critical mass number. House price falls then accelerate (historically speaking) when we reach the critical mass number. What we are seeing now, exactly matches the profile of what has happened in the past

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  • uncle tom says:

    With an extra bank holiday and pristine house hunting weather, there is little mitigation for the bulls…

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  • sibley's b'stard child says:

    Cripes, and Forex (last week) had them pegged-down as a +0.2% rise. I take back what I said the other week about Forex being reliable.

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  • happy mondays says:

    Maybe time to wake up & smell the coffee UK public 😉

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  • I did post about a friend who had multiple buy to lets on here recently with £3 million mortgage.

    he’s just had his portfolio revalued by a bank as he was hoping to restructure.

    their valuation has come in at £2,690,000

    his payments have doubled as his fixed ran out and so I recommended he pay what he can and let the bank recide what course of action.its now their problem

    sad story really

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  • House prices are now the same as they were in February 2009 and in June-August 2004. No-one who bought in the last seven years has made a profit, unless they were lucky or live in London.

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  • phdinbubbles says:

    The graph doesn’t look as nice as the seasonally adjusted halifax headline figures:

    (All non-seasonally adjusted, Land Reg shifted back a bit to account for lag)

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  • Good stuff! I noticed that for the area where I am currently living (Dundee DD5 postcode), zoopla is showing that prices are about 1% down on FIVE years ago.

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  • I really do find Martin Ellis’s comments most amusing, to describe a 1.4% fall as a “modest decline” and to cite an “increase in employment” as a factor that will support the market is quite risible.

    I do however think that he is right in describing the market as falling gradually, I see this as continuing for as long as interest rates are held at their current level, the big falls will only happen when interest rates move up.

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  • monty: “No-one who bought in the last seven years has made a profit, unless they were lucky or live in London”

    It’s even worse than that, if you factor in inflation

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  • I think the biggest shock will be that after they fall they won’t recover.

    they are falling with every single stimulus imaginable,so property cannot be seen as an investment for at least 10 years imo

    buy to let of course will sell as prices fall….buy high sell low!

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  • Looking at the graph, surely there has to be a sharp drop in the NW figures soon, to bring them back into line with the others?

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  • pelethar: If you pan out a bit they tend to converge. They usually move towards each other (rather than one correcting towards the others) which is why a mean of the main indexes tends to give us a relatively reliable number

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  • Thecountofnowhere says:

    “It’s even worse than that, if you factor in inflation”…errr….I think you mean It’s even BETTER !!!!

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  • mark wadsworth says:

    Yeah!

    @ SBC Halifax is clearly the most reliable house price index!! I shall never glance at another one again! I’m surprised they didn’t bring this out last Thursday morning on the off-chance that BoE would reduce base rate to 0.25%.

    @ PhD, splendid chart, keep ’em coming.

    @ Flash comment 15, if we are being (as ever) entirely fair about this, I think it’s most convenient to ignore inflation, as the only alternative to owning is renting, so if house prices flat in nominal terms over 7 years, the owner-occupier has paid (say) 7 years x 5% interest and the tenant has paid 7 years x rent (also about 5% gross).

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  • mark: That’s fair enough if we were comparing buying to renting. On the other hand, one of the main arguments put forward by BTLers has been ‘capital appreciation’. In fact, their numbers have not stacked up, for a long time, without the much-touted capital appreciation. I therefore think that it’s only right and proper that we demonstrate that they have actually experienced minus capital appreciation in real terms.

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  • even if you bought a house cash round here for £200,000 you are unlikely to get more than 5% return based on £1000 per month rent minus fees,tax building insurance,gaps and repairs I cannot see more than 3.5% net

    you can get more than that in the bank these days.

    so buy-to-let no only does not stack up with cash it must be basically pointless in a falling market

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  • I’m worried that as time goes on it looks less that ”dead cat bounce”, but more like a dramatic recovery.

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  • hpw: I wouldn’t pay any attention to the appearance of a chart. They only show us what has already happened. What happens next will shape the chart and not the other way around.

    If we believe that inflation, low wage growth and austerity measures are eroding peoples disposable income (they are) and that low credit availability is limiting their ability to pay silly house prices (it is), then house prices will probably fall, no matter what a chart looks like. I put almost no store in charts as a predictive tool

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  • mark wadsworth says:

    The figures for BTL are merely the flip side of the figures for renting.

    For most people, becoming a BTL landlord is not a realistic choice (because we can’t all be BTL landlords, or who would we all rent to?). But it is quite possible for everybody to be an owner-occupier if prices fell or people’s net incomes rose.

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  • ontheotherhand says:

    hpwatcher at 22. The nationwide blue line especially looks like a head and shoulders which precedes the second and bigger leg down…

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  • hpwatcher says:

    hpwatcher at 22. The nationwide blue line especially looks like a head and shoulders which precedes the second and bigger leg down…

    Fingers crossed that you are right.

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  • brickormortis says:

    “There are signs that house sales are stabilising albeit at a level lower than the historical average.”

    Stabilising?

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