Wednesday, August 31, 2016

Nationwide HPI +0.6% m/m

Slight pickup in house price growth in August

UK house prices increased by 0.6% in August, resulting in a slight pick up in the annual rate of house price growth to 5.6%, from 5.2% in July, although this remains within the 3- 6% range prevailing since early 2015.

Posted by hpwatcher @ 07:56 AM (4547 views)
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16 thoughts on “Nationwide HPI +0.6% m/m

  • Seems a little high to me…..

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  • I’d like to see house price movements with home improvements factored in. One research organisation says that the number of home improvements requiring planning permission (i.e, excluding small conservatories and new kitchens) is currently growing at about 4% each year. How many of these improvements are made with a view to putting the house on the market? How does this affect the average house price

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  • icarus, that is not relevant since the previous prices against which this is compared are also not adjusted. Furthermore, it is likely that as many homes are deteriorating as are being restored, if not more in light of BTL investors not putting a penny back in, ploughing it instead into other properties whilst their empires rot like over-worked cash cows with mastitis.

    The main issue is, that it is likely that mass immigration front running border controls is more than counterbalancing the hysteria from project fear. Once the 48% who expected a crash become bullish, we will see a return to 10% growth.

    They have just admitted another 800,000 people working not on the records, migration is back at a record and many of the new migrants are being calculated as a tourist surge, yet they have no way of differentiating tourists from immigrants.

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  • There are times when improvements are growing y-o-y and times when they are dropping y-o-y. It’s worth checking to see if this correlates with house prices. If there’s a 4% y-o-y increase in improvements it’s likely that the stock as a whole is going up in quality (that compounded would almost mean every house is significantly improved every 20 years) – and in floorspace. (Would those improvements be fully factored into like-for-like house price comparisons over time?) And how many BTLs are putting their rotting houses on the market? Those immigrants contribute mainly to BTL cashflow (and, to some extent, thence to the lender). We know that few have the deposit and income to buy a £400k, 3-bed house.

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  • Sorry, forget about the compounding. You can’t work that out from the 4% y-o-y growth figure.

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  • Icarus, 1.006 ^ 12 = 1.07442416772

    7.44% annualised rate.

    As said, soon as the traumatised Bremainers become bullish, we will soar above 10%.

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  • The real annual figure is lower, because previous months have lower figures. 7.44% is an extrapolation of August in isolation.

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  • Again people posting here are blinded by their own bias rather than reading what is only a 2 page bulletin posted.

    It basically says that mortgage approvals are low, and that supply is being taken off the market, and therefore the jury is out. Agreed.

    Indeed the author himself appears confused by the info. The stalemate could be resolved either way.

    As for linear extrapolations in a cyclical market… waste of time.

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  • Cyclical marketS even, since regions behave differently.

    Not sure why comment 6 is addressed to me.

    It’s fair to respond to an article about house price changes by asking to what extent home improvements affect those changes. There are over 400,000 home improvement planning applications a year (a number that has been rising at about 4% for the last 4-5 years), plus those improvements that don’t need a planning application. Any causal link from this to house prices could of course work both ways, and it could be seen as part of the self-reinforcing process where rising property mean rising collateral against which credit is supplied to make prices rise even further, but it’s worth pointing out that improvements can at least complicate like-with-like comparisons over time.

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  • I’ve just sold a property which came to me by way of an inheritance – peak price in the street on like for like housing was 2005 and the sale price after disbursements in August 2016 was down 25%. Similar situation with the purchase of my Daughters 1 bed flat November 2015 which was down 32.5% from peak selling price.

    Essence of the tale from the coal face is that if you are living “oop North” then house prices certainly haven’t been heading North !

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  • @9 cycleS yes… as Jack C has shown.

    I think the lack of volume is the issue and whether that is temporary or seasonal. Ofc it’s fine to discuss the current numbers and the current situation. I think your issue is that the sales are skewed toward places that have had money spent on them and re-sold.

    That may be true , although to be fair wont the new tax regime make that less likely going forward ?

    The real problem is the measurements can easily be skewed especially during low volume times and that we don’t have a homogenous stock to compare with each series.

    The US measures the median house for comparison. Also mythical just a bit less mythical 😊.

    I started to wade through the work for the new measure but got a bit bored but I’ll have another go.

    Obviously the real bias is this front running immigration stuff. No doubt we will have other opportunities for a discussion on that since it appears to be repeated in almost every thread ad nauseum.

    Maybe that will have a major effect but I think we need to actually see some numbers and , god forbid, some causation analysis.

    In the meantime the main fact drawn from the posted article is that mortgage approvals are low; volumes low as sellers are not willing to lower offers. Hmmm

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  • It now seems that the BTL crew are withdrawing their houses and now offering then for shorter holiday-type lets and/or AirBnB….so rents are going up, due to decreasing rental stock.

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  • hpwatcher – back in the day there was Wife swapping, car keys in the middle of the table and then off you went. Now it’s house swapping that’s the latest rage !

    Have a great weekend everyone

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  • Shorter “Holiday” rents from those front running border control who want a place by hook or by crook.

    Seriously, you will find an extra million migrants this year. Well educated folk on the whole who will get their National Insurance card and bag any job they can get their hands on for a visa.

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  • 13. jack c said…back in the day there was Wife swapping, car keys in the middle of the table and then off you went.

    Is that not car swapping, instead of wife swapping….or does the wife come with the car?

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  • HPW – very suggestive last post ! anyway I believe the Wife comes on the back seat of the car

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