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UK House prices: News & Views

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Very good interview Dominic.

 

Would someone please post the text of the newspaper article Dominic and Max were talking about? I believe it is from the FT, but I don't subscribe, and don't want to for one article.

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A Good One !

 

"They are trying to find a 'Magic Bullet'"

 

Yeah. It seems like thay have dusted off the one - used so "effectively" by Alan Greenspan, to create the US Housing Bubble.

 

Do we never learn ??

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Funding for Lending has pushed rates down to... simply rediculous levels.

 

I'm about to remortgage for 5yr fixed @ 2.99%.

 

 

When you factor in yields of 5-6% (perhaps better outside London) many people will do the math and conclude there is no "reason" why they should not be buying if they can fix their costs and why the market could not easily go up another 20-25% before renting again becomes cheaper.

 

 

I know it's a precarious, strategy that is doing unrecoverable damage to the UK in the long term, and rates can only go one way, but we all know that Osborne will do everything he can to prop up the housing market, so people are rightly concluding that they are individually better off to go along with it.

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What a rate !

 

Grab it !

(That's one advantage of being a homeowner, I suppose.)

 

What will your mortgage cost be vis-a-vis renting? (Just curious)

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What a rate !

 

Grab it !

(That's one advantage of being a homeowner, I suppose.)

 

What will your mortgage cost be vis-a-vis renting? (Just curious)

 

 

The market rate for our flat would be about £1300/month gross or £15,600 pa, subtract service charge and some running costs.. call it £14,000 pa net.

 

market value... roughly £270k... Interest on a 100% loan @ 2.99% (of course, you couldn't get 100% LTV at this rate) would be £673pm.. £8076, pa, so I am saving effectively 6kpa vs renting.

 

2.99% isn't even the lowest rate; if you have 40% equity there are a few lenders who will do 2.5% 5 year fixed, but rates for lower LTVs are also much lower than they were 2-3 years ago.

 

Homeowners are making hay, private renters are being squeezed to death, and we continue to tie up all our capital in an unproductive housing stock and pay for them through the mcJobs that such an economy produces. It's a very unhappy country of haves and have-nots, all as a result of the government protecting the homeowner.

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A feb-2013 article:

 

http://www.bbc.co.uk...siness-21381921

 

"The average five-year mortgage deal has come down in cost substantially in the past two years.

Recent statistics from the Bank of England showed that in December 2012 the average interest rate being offered on a five-year deal was 3.89%.

 

That compared to an average rate of 5.15% two years ago, in February 2011."

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Lots of chat between my colleagues and friends about buying houses/starting BTL/property portfolios for the long game.

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Lots of chat between my colleagues and friends about buying houses/starting BTL/property portfolios for the long game.

 

Headed-towards the Peak Talk?

 

Do BTL investors get Help-To-Buy

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Headed-towards the Peak Talk?

 

Do BTL investors get Help-To-Buy

 

Its crazy, there has to be a better trade....but then a lot of people said that 5/10/15 years ago. And if the trend is your friend....

 

BTL, i dont think they do

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HELP TO BUY isn't Helping ... BDEV is telling a different story

 

BARRATT on the Edge ... Let's watch it !

 

I don't normally watch the 100d MA, but it seems to have worked for Barratt.

Last time, BDEV hit it, it bounced - It is back there today, at the 318P level.

 

BDEV / Barratt Developments Plc ... update : PSN-chart

oqm.png

 

PSN has already broken the 100d-MA

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Property stocks spooked by governor's interest rate pledge

 

Property Week News

 

The Bank of England's announcement last week that interest rates would be fixed at 0.5% until unemployment fell to 7%, on the face of it, appeared a positive announcement for the property industry.

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Lots of chat between my colleagues and friends about buying houses/starting BTL/property portfolios for the long game.

 

Pre -frenzy feeling in (parts of) the UK right now.

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MSM does have its uses - a very good piece by Faisal Islam and Norman "today has been a very difficult day" Lamont predicts bloodshed (both Guardian/Observer)

 

http://www.theguardi...l-islam-housing

 

Lamont becomes the most senior figure to raise doubts over the huge increase in the buy-to-let mortgage market, which has surged to levels not seen since the 2008 financial crash.

Surely this is blindingly obvious to get the hell out of debt and remain liquid (obviously not sterling)?

It's going to be an exciting time when business get back from its hols.

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This was the "meat" for me;

 

Remarkably, through the credit bubble the likes of Northern Rock and Bradford & Bingley boasted to investors that Britain's "very limited" rate of housebuilding supported their doomed strategies. Successive governments delivered that help. The deal for Britain's young has transpired as follows: pay taxes, pay high rents and endure the sharpest points of austerity in order to help support a housing system that is delivering wildly expensive houses, or none at all, and to help bail out the failed banks that were built on that system.

 

Are we going to load the burden of adjustment from a decade-long bubble on to people who happen to have been born in the 1980s and 1990s? Progressive voices keen to redistribute through benefits have said very little about the overarching negative redistribution caused by the trebling of house prices. All political parties claim to want to foster "social mobility", yet it seems that where you live will be determined more now by where your parents lived.

 

The government is helping the BTL speculators with these mad policies, not the ones they should be helping

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From today's Guardian - "Foxtons bosses in line to make £100m as estate agent prepares flotation"

 

 

And a nice piece by Ann Pettifor - great phrase for the UK economy - Alice in Wongaland - she is good on media as well, see Keiser report.

 

http://www.primeeconomics.org/?p=2030

 

It does seem odd and very depressing that George Osborne is carrying on the policies of Gordon Brown.

 

Several thousand public sector jobs? - no, but we will do HS2 instead.

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It does seem odd and very depressing that George Osborne is carrying on the policies of Gordon Brown.

 

Several thousand public sector jobs? - no, but we will do HS2 instead.

 

gnashing of teeth here

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http://www.marketora...ticle41905.htmlUK House Prices Bull Market Soaring Momentum, 10% Inflation by October? Housing-Market / UK Housing Aug 19, 2013 - 03:11 AM GMTBy: Nadeem_Walayat Prospective U.K. home buyers who may have been persuaded by the pseudo-economists, financial / economic journalists that populate the mainstream press as to the sustainability for any rise in UK house prices will over the past few months been finding themselves in an increasingly panicky state as UK house prices have literally started to soar as illustrated by the latest data and news out of RICS that reported that house prices are now rising at their fastest pace in 7 years, with their indices giving their best readings since November 2006.

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graph from above article, Market Oracle

post-3033-0-95112600-1377619522_thumb.gif

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As pointed out by the ASI, Where America leads, Britain follows:

http://www.adamsmith.org/sites/default/files/research/files/burningdownthehouseWEB_0.pdf

 

 

Like the British government does today, the American

government once waded into the mortgage guarantee

business through a number of government-sponsored

private enterprises (GSEs) – particularly the Federal

National Mortgage Association, known as Fannie Mae, and

the Federal Home Loan Mortgage Corporation, known as

Freddie Mac, both of which played a central role in the U.S.

housing market for decades by purchasing mortgages and

pooling them for securitisation. The primary benefit of

GSE involvement in providing liquidity to the residential

mortgage market was that the strength of the AAA

American sovereign credit was implied upon the GSEs,

reducing interest rates for, and increasing liquidity to, the

housing sector, widening access in much the same way the

government proposes to do with Help to Buy.

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I expected this a long time ago:

 

Britain’s new breed of landlords should prepare for a political backlash

 

author-matthew-lynn.png By: Matthew Lynn .. 02/09/2013

 

Resentment at landlords is growing by the day, says Matthew Lynn.

Would-be investors in buy-to-let could well get their fingers burnt.

 

Britain’s new breed of landlords should prepare for a political backlash

 

By: Matthew Lynn

02/09/2013

 

There may never have been a better time to be a landlord in Britain. ....

 

Landlords always face risks, of course. If house prices collapse, they’ll be left with a capital loss. And interest rates might rise, even though Bank of England governor Mark Carney has promised to keep them low for at least another three years. But the biggest risk that landlords may be missing is not financial. It’s political.

 

The rise of private landlords is starting to create a backlash – and it’s going to intensify. Already the Labour Party is discussing rent controls. Its housing spokesman, Jack Dromey, has been reported as privately favouring such controls. Even if he seems to have backed away from that in public, he is arguing for longer rental agreements to try to curb soaring rents, particularly in London.

 

In the last election for London mayor, Labour’s candidate Ken Livingstone argued for a ‘living rent’, by which he meant that rental payments should not be more than a third of a person’s pay. .....

 

== ==

http://www.itulip.co...6406#post266406

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Could this RISK of Rent Controls be impacting on BDEV's share price?

 

Rising rates are imperiling the UK Housing Bull run

 

A break of the Up-trendline, could bring BDEV all the way back to the bottom of the Green box

- at maybe 230p within the next month. And even then, that support may not hold.

 

BDEV ... update

 

yls.gif

 

When the 21d-MA crosses the 76d-MA and the Uptrend is broken, it would confirm at least a serious correction is underway IMHO

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The agents are pumping some Expensive London properties,

now that the summer is over...

 

st-james-the-corniche-exterior-sunset.jpg

 

Le Corniche - would anyone else buy it ??

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The agents are pumping some Expensive London properties,

now that the summer is over...

 

st-james-the-corniche-exterior-sunset.jpg

 

Le Corniche - would anyone else buy it ??

 

 

Well perhaps Flipper might be interested?

 

flipper090720_250.jpg

 

After all house prices are rising at the "fastest rate since 2010" according to the Beeb.

 

(This is really a headline for the Daily Express)

 

"
UK house prices 'rise at fastest rate since 2010'

 

 

UK house prices have risen by 5.4% in the year to August, according to the Halifax's latest house price survey.

 

It is the highest annual rate since June 2010.

 

On the Halifax's measure, the average price of a house also went through the £170,000 mark for the first time in five years.

 

However, the figures are still well below the peak of the market in August 2007, when the average price was almost £200,000.

 

The Halifax said housing market activity was up thanks to an improving economy, low interest rates, and government-backed schemes such as Help to Buy.

 

Earlier this month the Nationwide said house prices in August were rising at an annual rate of 3.5%, slightly slower than in July.

 

The Nationwide compares prices in one month with the same month a year ago.

 

However, the Halifax compares a three-month period with the three-month period in the previous year.

Continue reading the main story

UK house prices

 

Year on year % change

 

 

Martin Ellis, the Halifax's housing economist, said: "Overall, house prices are expected to rise gradually over the remainder of the year."

 

The Halifax believes below-inflation pay rises "are likely to act as a brake on the market".

Property bubble

 

The Halifax estimates the average price of a house or flat in the UK is now £170,231. The last time house prices were higher than £170,000 was in September 2008.

 

The number of mortgage approvals for house purchases - an indicator of completed house sales - rose by 10% between the first and second quarters of 2013.

Continue reading the main story

House price calculator

 

Use our calculator to see where you can afford to rent or buy

 

In July alone there were 60,600 approvals, the first time the number has exceeded 60,000 since 2008.

 

The rise in prices and market activity, coupled with the Help to Buy scheme, which offers a government-backed loan of up to 20% of the price of the property, have increased fears that the country could be heading for another property bubble.

 

But last month Mark Carney, governor of the Bank of England, said he was "acutely aware" of the risks, and had a "toolkit" of measures he could employ to combat unrestrained mortgage lending.

 

Matthew Pointon, property economist at consultancy Capital Economics, said: "A short-term imbalance between housing demand and the number of homes on the market is driving price increases.

 

"But the rise in wholesale interest rates seen over the past few weeks may soon start to feed through to mortgage rates, dampening demand."

 

There are already signs that mortgage rates may have bottomed out, with some lenders increasing rates earlier this week."

 

 

 

 

 

 

Well isn't this just marvelous news for all those bright young things with newly minted degrees and tens of thousands of pounds of student debt.

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