Tuesday, December 6, 2011

November 2011 down

Halifax House Price Index

Annual change -1.0% Quarterly change -0.6% Monthly change -0.9% Average Price £161,731

Posted by dill @ 08:23 AM (3342 views)
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29 thoughts on “November 2011 down

  • Non-Seasonally Adjusted MoM: -2.1%.

    (Haliwide NSA, LR SA and shifted back)

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  • NSA house prices lost over a £100 a day last month. You wont see that on the front cover of the Express though…

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  • He asks himself what could possible drive the market up next year?

    Banks increasing lending – don’t think so.
    Wage rises – don’t think so (Except train drivers)
    Economic recovery – don’t think so
    Interest rate cut’s – don’t think so..
    Government interference – maybe.
    The Daily Mirror propaganda – Nope. Circulation of this comic is now terminal.

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  • @ phd – top stuff on the graph (as usual)

    @ khards – I noticed you made a recent comment on another thread regarding the unavailability of this site over the last few weeks – is it just me or is hpc site extremely slow when it is available?

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  • I couldn’t access the site all of yesterday evening (using Mozilla)

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  • Good to see lots of negatives. I really don’t think the Halifax can afford to see too much of a drop in house prices – given how exposed they are.

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  • jackc they had mysql issues yesterday not sure what they are using on site but it is buggy as hell

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  • lloyds banking group has a 33% exposure to mortgaged uk property

    GULP!

    mind you it must be top quality otherwise why would the authorities allow andy hornby to be CEO of corals?

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  • 33% exposure based on what figures – does not make a whole lot of sense, can you break it down?

    if prices dropped by 30% what effect would that have on lloyds probably not a lot – there will always be people who can continue to make payments and will do so even if their house price dropped 50% they have a moral and legal obligation

    lloyds is a pretty safe bank overall

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  • lloyds is a pretty safe bank overall

    No it’s not. A few things would need to happen though i.e. house prices to drop 30% – with repossessions, so the losses were realised – and lots of EU debts going bad i.e. Lloyds is heavily exposed in Spain.

    Lloyds may be a lot of things, but safe it ain’t.

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  • hpw

    drops of 30% would not have a huge effect on the bank

    Lloyds has been disposing of european debt

    where do you get your assumptions from

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  • sibley's b'stard child says:

    -0.9% MoM? Jolly good.

    NW, please do keep up at the back.

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  • mark,
    I read in a recent report that it takes just a 10% fall in the value of a bank’s assets, other things being equal, to render it insolvent. (Hence the government takeover we already had.) This obviously includes houses backing mortgage debt. Other things won’t be equal, but still. It’s difficult to know what is going on, ie how much the value of their assets have fallen, as the banks won’t mark their assets to market unless forced to do so.
    N

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  • [email protected]

    they have 33% of all uk secured debt as said by themselves and all their analysts

    if prices drop 30% they will have to write it down under capital rules and raise money to cover.

    in other words they will be bust!..and have to be fully nationalised..which also means hmg will have to write off their shares too

    this is what happened to banks in ireland and its coming to the uk

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  • yes but what is the 33% value in relation to their overall business – also if there was a 30% in value for the 33% what effect would this have on a bank if say the 33% was only 5% of their business

    the figures are irrelevant without some kind of info regarding the rest of their business

    see what i am getting at

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  • hpw

    drops of 30% would not have a huge effect on the bank

    If that is the case, why then is BOE holding interest rates to low? King has said in several interviews that he needs to keep asset prices high. Why would he want to do that?

    where do you get your assumptions from

    I want to know where YOU are getting your information from? The LloydsTSB PR department? Sounds like it.

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  • yes but what is the 33% value in relation to their overall business – also if there was a 30% in value for the 33% what effect would this have on a bank if say the 33% was only 5% of their business

    Lloyds are exposed through Halifax.

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  • mark

    I don’t know exactly other than it will break the bank…morgan stanley said if prices dropped 10% then lloyds would have 185 billion pounds of loans in negative equity…30% drop and its game over

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  • king and his mates own a lot of property they are looking after their own interests not ours or the banks

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  • i have utter faith in my investments i have always made the right decision on shares

    some i mentioned in the past
    Oilex i said sell at 26p bought at 11p
    barclays many different times bought and sold
    same with lloyds
    IQE recently bought a load i say hang on to them they have huge potential
    boyd gaming in USA i mentioned them on here long before they had a public announcement of running online casinos and legislation changing to allow this in USA again this has huge upside potential they have since gone up

    plus many more so why doubt me on lloyds bank

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  • some i mentioned in the past
    Oilex i said sell at 26p bought at 11p
    barclays many different times bought and sold
    same with lloyds
    IQE recently bought a load i say hang on to them they have huge potential
    boyd gaming in USA i mentioned them on here long before they had a public announcement of running online casinos and legislation changing to allow this in USA again this has huge upside potential they have since gone up

    plus many more so why doubt me on lloyds bank

    Good for you, but I would not buy Lloyds.

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  • why is there a resentment for people who make money or get things right, there seems to be a lot of that on here

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  • from experience you must be the only person who has always picked winners with shares.

    if its true then you are due a setback!

    lloyds will see to that

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  • taffee

    i had a setback some years ago i lost just over 70k

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  • I notice the lloyds/halifax House Price Earnings Ratios (Average seasonally adjusted house price divided by average Male full-time earnings) make for interesting reading………… (they are Q3 numbers, so I may be a bit late with this info)……….. there’s a few salient points that surprised me…… (to the point where it looks like the data is questionable perhaps?)…………

    -UK ratio is down to 4.19 – lowest since 2002.
    -Several regions have dipped below 4.00 this year (E Mids, North, N Ire).
    -South West is still most overpriced at 5.08 (even beating S East and Gtr London at 4.94 & 4.79 respectively)
    -Some regions have dipped below their long-term averages (measured since 1983) = E Ang, N Ire, Scotland, S East. (I realise the averages are skewed by the bubble, but interesting nonetheless).
    -UK average is now only 3.3% above the long-term average of 4.06

    So, even though nominal falls haven’t been huge since Q2 2007, the ratios have fallen dramtically because of wage inflation & the moderate nominal drops.

    If you extrapolate forward 1 year, assuming the same %age fall in ratios in the last 4 Qtrs, then the majority of regions go sub-4, and pretty much ALL regions go below their long-term averages (or darn close).

    So, looks like the UK is gonna “wage inflate” the ratio down, chuck in a few small nominal falls along the way & everywhere will be back to circa 3.5 by late 2013…….. but imagine what a rise in Interest Rates would do………….

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  • I have been reading this site for years now and always told myself I wouldn’t post. The common concensus amongst the people I know who visit this site regularly is that people who comment on the articles are a bit mental. There is only so many times you can talk about gold, LVT and UKIP before people start questioning your sanity.

    Nevertheless, I have spotted something interesting on this site that every much-anticipated post from phdinbubbles goes further to confirming and I can’t really resist sharing it. House prices have hardly ever fallen in nominal terms, except in 2007 and the 90s. I am still of the mind that nominal falls are incredibly likely, barring a hyper-inflationary scenario. For all the Mervyn-bashing that goes on here, I think it’s safe to assume inflation will drop to around 3% next month, simply because the effects of the VAT hike will be eliminated. As such, (as khards says @3) there are myriad reasons prices will fall, but none that they will rise. With unemployment rising, flashman’s jobless threshold could be breached soon and the Euro crisis might set off a wave of repossessions. I also think the HB reforms are likely to cause a BTL firesale in London. Nevertheless, increasingly I find myself looking to the graph of the “last house price crash” as a basis for comparison.

    Its hard to read the graph here as its so small and I can’t be bothered to find the data on the Halifax website. Here is how it went:
    -The initial crash lasted 7 months
    -The DCB lasted a month
    -The market stagnated for 14 months
    -Falls began to accelerate and only started to really dip significantly below where they were at the peak from 21 months after the start of the DCB

    You can pretty much scale that graph and throw it in phd’s chart and it would fit quite convincingly other than the fact that the DCB was more protracted this time:
    -The initial crash lasted 16 months from Jan 08 (LR SA), 20 months from Aug 07 (H SA) or 14 months Oct 07 (N SA)
    -The DCB lasted 12-16 months
    -Prices have trended down/stagnated since Jan-Jun ’10

    Moneyweek has always said that crashes, in real terms, tend to last as long as the booms that precede them. Everything I’ve learnt about debt leveraging cycles tells me this makes sense. As such, house prices should be bottoming out around 2018 (by which time the debt-saddled students that would otherwise be becoming first-time buyers will be making decent money, so the next boom is probably quite a long way off). They used to claim that, but more recently I think they point to 2015.

    I think it’s fair to count the protracted DCB as part of the stagnation, given how much further prices fell this time (20% as opposed to 3%) and the unprecedented drop in interest rates that made the prices rebound so much harder. Ultimately, any amount of time since the crash bottomed out is time spent deleveraging. As such, since the initial crash lasted twice as long (14 months approx. rather than 7), we should expect twice the length of stagnation (28 months rather than 14) and only see prices start to accelerate a further 14 months later.

    That would mean prices begin to fall around 28 months after the start of the DCB (Feb ’09 according to the lenders, May ’09 according to LR): that’s pretty much June this year around the same time the current trend got going.

    Assuming this 2:1 scale is accurate, we should be in freefall by the end of the olympics and the market will bottom out 6 years after the start of the DCB (ie early 2015).

    Of course, the past only gives you so much indication of the future but I have fully been expecting a 5 year wait since the early last year so I can live with it. In reality, only a spate of repossessions will make this crash resemble the last. I would also be particularly wary that since we got 3% initial falls in 1990 and little more than 10% falls by 1995, that prices will fall by so much more this time around (i.e. 60%). Nevertheless, I would expect falls to around mid-2009 levels (i.e. circa 20%), perhaps even as much as 30%. In any case, where I live, Wandsworth, prices were more than 20% down on peak (March 2008) and now they are about to break records again so it is a relief to note that Greater London is about to go negative yoy.

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  • Mark @ 22, ‘cos no-one likes a big ‘ed! Especially ones who use every single post to trumpet their gains

    Re Lloyds going bust etc, above assumptions are far too simplistic, negative equity does not equal default in 100% of cases.

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  • the average houseprice is 26k the average price is 160k,by all historical measures this is very very high

    other ratios take into account ‘affordability’ due to low interest rates

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  • average salary 26k I mean

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