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Central LONDON Property: Databank & Charts

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MYTH EXPLODING ... so Central London is different, is it??

 

Whodathunkit?:

the wealthy are losing confidence in bricks and mortar as an investment. There has been a big drop in City bonuses...

 

<a href="http://business.timesonline.co.uk/tol/busi...icle2759795.ece" target="_blank">http://business.timesonline.co.uk/tol/busi...icle2759795.ece</a>

 

QUOTE

House prices fell for the first time in two years this month, sending a shudder through millions of homeowners already hit by rising mortgage repayments and more expensive borrowing.

 

The outlook for homeowners is likely to worsen with news that the wealthy have lost confidence in bricks and mortar as an investment. There has been a big drop in City bonuses being used to purchase prime property in Central London and in the popular second-homes areas, triggering fears of price falls in the South West, East Anglia and the Cotswolds.

 

Today’s figures will increase the anxiety of millions who have banked on ever-rising prices to fund their old age and pay off mortgages. To add to their misery came a new warning from America that Britain would not escape the fallout from US as the property market there went through its worst recession in 16 years. Robert Shiller, professor of economics at Yale University, who forecast the end of the dot.com bubble in March 2000, told The Times that the slow-down would start in London.

. .

The amount of City bonus cash flowing into prime London property and into second and third homes will fall by 60 per cent to £2 billion in the coming year, according to one of the country’s largest property agents. This will lead to at least six months of falling prices in Central London, predicted Savills, the estate agency, which specialises in selling houses worth £1 million and more. Also at risk are the Cotswolds, the South Westand parts of Norfolk, Suffolk and Kent.

 

Savills gave a warning that the top end of the property ladder and the second-home market could be hit hardest because financiers, accountants and lawyers no longer saw property as a good buy and were more likely to put money into hedge funds.

 

Meanwhile, the Centre for Economics and Business Research predicted that the credit crunch, combined with five interest rate rises in just over a year, would cause prices to fall for the rest of this year and into early 2008. But it suggested that the housing market would shrug off the difficulties within a year and that by 2010 annual growth would be back at up to 7 per cent because of an imbalance of supply and demand.

 

= =

 

Now where are those exaggerating sacks of VI spin when the reality comes spilling out??

Some EA's should now be chewing some tough crusts of humble pie on this news.

 

Aarghh ! this kinda news hitting the broadsheets is bad timing for me as am still waiting to exchange contracts on the sale of my flat..... hopefully the buyer is out of the country for a few weeks !!

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Aarghh ! this kinda news hitting the broadsheets is bad timing for me as am still waiting to exchange contracts on the sale of my flat..... hopefully the buyer is out of the country for a few weeks !!

 

Most people have trained themselves to ignore bearish news articles. So you should be okay

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goldvsproperty1hu6.gif

 

goldvsproperty2fx9.gif

 

goldvsproperty2qs9.gif

 

 

That last chart does no include the recent move in gold as the data is a few months old.

 

By the way, for the prices in ounces we have for

UK/London/Scotland for this time period:

 

Average

275.28 426.37 233.40

 

High

695.50 1,077.67 507.41

 

Low

80.89 107.19 76.73

 

Source: http://www.ma.hw.ac.uk/~fischer/

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Interesting charts Frizzers! Well found. The big swing down this time in "real" terms will not be hidden from view because of inflation. The idea that UK property only goes up is going to be totally demolished.

Sincerely

Hogwild

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Interesting charts Frizzers! Well found. The big swing down this time in "real" terms will not be hidden from view because of inflation.

The idea that UK property only goes up is going to be totally demolished.

 

Looks like the "dead cat bounce" should be over.

How up-to-date are the prices?

Can you give us a calculation as of end-October?

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Currently, with gold at £380 per ounce and the average UK house at £184,131, you can now buy that house for 485 ounces of gold.

 

The rise in prices we saw in 2006 was nothing more than a bear market rally.

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Currently, with gold at £380 per ounce and the average UK house at £184,131, you can now buy that house for 485 ounces of gold.

 

??

goldvsproperty2qs9.gif

 

So the BLUE line has fallne back below 500?

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Let's look at the UK. Here's up-to-date, what's happening:

 

"House prices are crashing - asking prices were down 3.2% in December from November, housing website Rightmove reported, way down from the 0.7% fall in November. Prices in London, center of the U.K. bubble and of world capital flows, fell by an average of $56,000 in December, the worst in Britain:

 

/see: http://www.inteldaily.com/?c=140&a=4603

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Meanwhile, gold is now up to £420 an ounce so that ratio is falling fast

 

I wonder how you feel now about having sold to buy gold?

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??

goldvsproperty2qs9.gif

 

So the BLUE line has fallne back below 500?

 

Thats very reassuring. Sold my home in late 2003 and then converted sterling proceeds to gold/oil and Canadian equity over the subsequent 8 months. Looks like I managed to get fairly close to the peak (for once).

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Well done, GW.

 

I wonder if the London falls will pick up pace in the second half of 2008.

 

This from Fred Harrison:

Some advice he has for UK authorities:

"First, they should avoid making the downturn even worse. If, for example, the Treasury sticks with its plan to level down the tax rate on capital gains, there will be a sharp drop in prices in the summer. Owners of buy-to-let properties are waiting for the new tax year to offer their apartments for sale, when the CGT rate will be cut from 40% to 18%. The effect will be a crash in prices, denting confidence even further."

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Well done, GW.

 

I wonder if the London falls will pick up pace in the second half of 2008.

 

This from Fred Harrison:

Some advice he has for UK authorities:

"First, they should avoid making the downturn even worse. If, for example, the Treasury sticks with its plan to level down the tax rate on capital gains, there will be a sharp drop in prices in the summer. Owners of buy-to-let properties are waiting for the new tax year to offer their apartments for sale, when the CGT rate will be cut from 40% to 18%. The effect will be a crash in prices, denting confidence even further."

 

Thanks. I saw that on consa's site, I wonder if there will be much capital gains left for the BTLers by then.

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According to latest data, Ken and Chelsea continues to rise at an annualized rate of 27%.

 

Rises also for Hammersmith and Fulham and Westminster.

 

This 'crash' hasn't reached prime Central London yet.

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According to latest data, Ken and Chelsea continues to rise at an annualized rate of 27%.

Rises also for Hammersmith and Fulham and Westminster.

This 'crash' hasn't reached prime Central London yet.

 

Hard to believe.

What's the data source?

 

(so much about London property seems to be lies. Hong Kong is much more honest and transparent.)

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"Annualised" returns are poor guides to the future,

and dont even tell us much about the present.

 

Do you really think that houses prices are still RISING in London?

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Remember, the UK is a year (or more) behind the US in the cycle,

and it may take a littkle longer for the downturn to BITE in Central London.

 

I reckon it is biting hard through out the Uk now, and as it came late (is coming late) to New York,

it may come late to Central London too.

 

Eventually, I continue to believe that London will be the GROUND ZERO of the global property bust.

And selling now, if you still can, will prove very wise.

 

Greetings and best wishes to the GEI lurker (& occasional poster) whom I met yesterday,

who had the great sense to sell in London to buy in Hong kong. Escaping the foolishness of Brown's

ex-Miracle, to enjoy the advantages of a more genuine miracle

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I've read your thoughts on the HK boom but as someone without the financial clout of the heavyweights on GEI and, more importantly, a HK income, I was wondering how I might tap into the potential. Not so keen on REITs but can anyone suggest any equities that stand to benefit ?

 

Isn't the impending US recession going to have a fairly profound inflationary impact on the HK economy cos of the HK$ peg to the greenback ?

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I've read your thoughts on the HK boom but as someone without the financial clout of the heavyweights on GEI and, more importantly, a HK income, I was wondering how I might tap into the potential. Not so keen on REITs but can anyone suggest any equities that stand to benefit ?

 

Isn't the impending US recession going to have a fairly profound inflationary impact on the HK economy cos of the HK$ peg to the greenback ?

 

I can, but with a few words of caution.

 

I like two HK-listed equities, but started buying too soon:

I think they are trading at something like a 40-50% discount to the NAV of their property assets

 

Link to : thread in the GEI members section (coming)

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