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UK House prices: News & Views

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HTB brought forward to next week.

 

So short of ideas or policy reform for their conference use an existing one instead?

 

Tories on suicide mission?

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The papers are full of stuff on house prices; a hedge fund (Tosca) is buying commercial property in the north of the UK; RICS is asking the govt to intervene to slow down house price rises. New mortgage guarantees coming in etc.

 

Is this all smelling like nearing a top? Maybe one more season (ie spring 2014) before we start going sideways? Any thoughts?

 

Indeed by 2015 could we see interest rates rise to slow down housing?

 

The big question to me is whether it will be 2015 or 2016 before we see a slow down in housing (not necessarily tho a significant decline).

 

More generally - is this not the point of QE ie to inflate assets and thereby make loans good, banks survive and the economy continues....

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Save this page; http://en.wikipedia.org/wiki/Next_United_Kingdom_general_election

 

The terms of the Fixed-term Parliaments Act 2011 mandate that the election will be held on 7 May 2015 (except in the event of a collapse of government or a two-thirds majority of MPs voting for an early election).[1]

 

---

 

What is the motive of the current Bank of England Governor?

 

---

 

There are two things to find out if someone wants to do this.

 

Find out the years of Mark Carneys (current Bank of England Governor) rein in Canada as the Central Bank Chief.

 

Find out what happened to interest rates during that time and any government policies created (this will be hard) that stimulated or hindered home prices.

 

We know the Canadian outcome already - Canada had a housing bubble during his rein.

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We know the Canadian outcome already - Canada had a housing bubble during his rein.

 

Methinks that may be why they brought him over...

 

(Am I being too cynical?)

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MoneyWeek sending this my inbox today:

 

"Secure investment with 7% NET* returns assured for

5 years from the UK’s fastest growing property brand"
Yes indeed invest in student halls of residence in sunny Exeter! (my home town)
That brand is Vita Student

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Shurely not!

 

I knew her once.

She was quite the lady, Ms. Shirley Knott

 

387deff6a5e7bc833645746acb751ca6.jpeg

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Here's another Shirley Knott -

who lives up to the name even better

 

l.jpg

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Save this page; http://en.wikipedia.org/wiki/Next_United_Kingdom_general_election

 

The terms of the Fixed-term Parliaments Act 2011 mandate that the election will be held on 7 May 2015 (except in the event of a collapse of government or a two-thirds majority of MPs voting for an early election).[1]

 

---

 

What is the motive of the current Bank of England Governor?

 

---

 

There are two things to find out if someone wants to do this.

 

Find out the years of Mark Carneys (current Bank of England Governor) rein in Canada as the Central Bank Chief.

 

Find out what happened to interest rates during that time and any government policies created (this will be hard) that stimulated or hindered home prices.

 

We know the Canadian outcome already - Canada had a housing bubble during his rein.

 

Canada's housing bubble will be spectacular when it collapses. I have heard that something like 10% of total jobs in Canada are now in the construction sector. Even the US at the peak of their bubble only had something around 7%.

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Canada's housing bubble will be spectacular when it collapses. I have heard that something like 10% of total jobs in Canada are now in the construction sector. Even the US at the peak of their bubble only had something around 7%.

 

That's High !

 

But in the UK this year, I think that 25% of New Jobs are in Property

 

That's a real bubble

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Fraud inspectors tackle London's Housing Benefit cheats

The City of Westminster has some of the most expensive homes in the world, so it is surprising that some residents are able to rent luxury properties and claim housing benefits.

Inside Out's Mark Jordan joins Westminster Council's fraud inspectors in a raid on one of hundreds of illegal sub-lets.

The cost to the taxpayer from these fraudulent claims is estimated to be around £10m in lost revenue.

Westminster Council's anti-fraud tsar, Councillor Lindsey Hall, talks about the challenges of tackling the problem and dealing with what she describes as "outrageous" cases.

Inside Out is broadcast on Monday, 30 September on BBC One London at 19:30 BST and nationwide thereafter on the iPlayer.

 

===

http://www.bbc.co.uk...ngland-24259715

 

Maybe they should limit the Housing benefit under a City-wide cap.

That would get the cheats out of the over-priced property

 

=== ===

 

Asylum seeking benefits cheat received nearly £400,000
25 November 2011 Last updated at 22:16 GMTHelp

A benefits fraudster who claimed he was bed-ridden, yet was filmed dancing at his own wedding, has been jailed.

Mohamed Bouzalim, 37, cheated the authorities out of nearly £400,000, Isleworth Crown Court heard

 

http://www.bbc.co.uk/news/uk-15899948

=== ===

 

Make an example of him !

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Save this page; http://en.wikipedia.org/wiki/Next_United_Kingdom_general_election

 

The terms of the Fixed-term Parliaments Act 2011 mandate that the election will be held on 7 May 2015 (except in the event of a collapse of government or a two-thirds majority of MPs voting for an early election).[1]

 

---

 

What is the motive of the current Bank of England Governor?

 

---

 

There are two things to find out if someone wants to do this.

 

Find out the years of Mark Carneys (current Bank of England Governor) rein in Canada as the Central Bank Chief.

 

Find out what happened to interest rates during that time and any government policies created (this will be hard) that stimulated or hindered home prices.

 

We know the Canadian outcome already - Canada had a housing bubble during his rein.

 

 

 

Mark Carney has been brought in to oversee and set up Help To Buy. He has been at the Canadian Central Bank in senior positions for ten years. http://en.wikipedia.org/wiki/Mark_Carney

 

This is our "Death Star" construction. He has already seen the plans of Death Star Number.1 in Canada.

 

Death_Star_Petition.jpg

 

It looks like, it's not a new trick. You reprice risk, and you can reprice the asset. Easy....

----

 

Help to Buy.

 

The scheme in question operates in Canada, and has been in its current form for over 20 years.

 

....The policy has been a resounding success. Home ownership in Canada has risen from around 61pc to 70pc since the scheme was piloted in the early 1990s, without a housing bubble.

 

http://www.telegraph.co.uk/finance/comment/10250490/As-the-economy-gathers-speed-Help-to-Buy-is-starting-to-look-excessive.html

 

canada-us-price-composite.1.jpg

 

Real_Estate_Index_BC_Vancouver_chart_Mar

 

 

There are two government incentives in operation to help home buyers in Canada;

 

First-Time Home Buyers' (FTHB)

 

Tax Credit Home Buyers' Plan (HBP)

 

http://www.cmhc-schl.gc.ca/en/co/buho/buho_008.cfm#FTHB

 

----

 

I think I might start a separate thread on Canadian Home builder shares, it might be another trading opportunity.

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Great charts - Thanks

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I re-read the Wiki page. Mark Carney has been in around the Canada's integral finance operations for a decade - but he was not formerly part of the Central Bank between 2004-2008. He is an experienced money changer.

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HELP TO ... (Expand a Property Bubble):

 

+ Video / 5-Oct. : How will Help to Buy scheme help property seekers?

From next week, first-time buyers and current home owners who only have a 5% deposit will be able to apply for a scheme to help them buy a new property.

The government will guarantee up to 15% of the mortgage.

Ministers say the second phase of Help to Buy will enable 190,000 people to buy a new home, but critics say it could cause a housing bubble. ("a smaller deposit than they might otherwise need..." not open to all - excludes BTL, foreigners)

=== ===

+ VIDEO : 29-Sep. : David Cameron interview in Full

+ VIDEO : 27-Sep. : GBP 600,000 Limit is Too High

"Prices should be at longer term average of 'Inflation plus 2.8%' "

- BULL-feathers ! What? Why "plus 2.8%" ?

- Ever hear of cycles, you Loony Tunes ?

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YOU COULDN'T MAKE IT UP - says Jonathan Davis

 

....

 

The only thing they have in common is they relate to properties marketed up to £600,000 – around 26 times average annual incomes. HAHAHAHA
HTB1, from last April, was about bailing out developers (notice their share prices soared, some 100%…). It is only for New Builds and First Time Borrowers (Buyers they call them). It, of course, continues. George and Jenny can borrow 20% of the total loan from the Government next generation and they pay ZERO INTEREST on that part for the first 5 years. HAHAHAHAHA
After the 5 years borrowers will be charged 1.75% in the first year, for that element. The next year the cost will be 1.75% + whatever RPI is AND 1%). The RPI + 1% will be the rate of annual increase on that part of the debt.
Does anyone SERIOUSLY believe RPI will be only 3% or so in 5 years?
I mean, seriously??? HAHAHAHAHAHAHAHA (BTW, the alternative is Japan 1989 to date, so no Get Out of Jail Free cards.)
Oh, and if inflation rises so will interest and mortgage rates.
So, obviously those FTBers are going to be debt slaves in the future as many of them will lose their incomes and their homes. But they will retain the debts and/or go bankrupt. Still laughing???
HTB2, from now ish, is for all buyers (except Buy to Letters, foreigners, 2nd homers). So, it includes second, third etc steppers. Also, not just new homes.
The lender will lend 95% of the price (not the value as obviously the value is much much lower than the price*) and the next generation will guarantee the lender 15% of the loan in case the loan turns bad. For this insurance, the Government will charge the lender a premium, as yet unquantified. Of course, the cost will be passed onto the poor schmuck who is borrowing.
Why don’t I call any of it Help to Buy? Well, how is borrowing 95% of something buying it?
So, the cost will probably be higher than if the individuals just saved a reasonable deposit. HAHAHAHAHAHAHAH No, stop, please. I can’t take it anymore.
Look, this has NOTHING to do with ‘helping folk’ etc. Rising house prices: vote winner. Falling house prices: vote loser.
As all Governments (incumbent politicians) do, they are buying votes, with our kids’ standard of living. They are literally robbing Peter’s son to pay Peter. [it has gone way beyond robbing Peter to pay Paul.]
===

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http://www.home.co.uk/guides/news/story.htm?help_to_buy_scheme_set_to_push_up_prices_by_15_

 

Didn't von Mises have something to say about this?

 

ah yes...

 

"The boom can last only as long as the credit expansion progresses at an ever-accelerated pace. The boom comes to an end as soon as additional quantities of fiduciary media are no longer thrown upon the loan market. But it could not last forever even if inflation and credit expansion were to go on endlessly. It would then encounter the barriers which prevent the boundless expansion of circulation credit. It would lead to the crack-up boom and the breakdown of the whole monetary system."

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Bond girl and Buy To Let Queen, Fiona Fulleton who has been under the radar for years, is selling her house, and she is appearing on Strictly Come Dancing (with some other "celebrities", like Vanessa Feltz...).

 

http://www.telegraph.co.uk/property/buyingsellingandmoving/10304539/For-sale-Bond-girl-Fiona-Fullertons-Gloucestershire-vicarage.html

 

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BDEV yesterday :

347.00

Change:

arrow_up_sm.gif+0.50

 

BARRATT : Possible Right Shoulder being put in now

 

BDEV ... chart update

 

5ug.gif

 

And here's BKG / Berkeley Group ... update - - - It may soon make a top at just over 2,400p
xnv.gif

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I got a cold call yesterday would I be interested in a 100% buy to let mortgage? from UK company Ward & Co.

 

It's deja vu all over again.

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Pay rent not interest with our Sharia compliant mortgage alternatives



Sharia compliant Islamic mortgage alternatives

Unlike a conventional mortgage where the purchaser borrows money from a lender which is then repaid with interest, Islamic Bank of Britain's Home Purchase Plans (HPP) are based upon the Islamic finance principles of a Co-Ownership Agreement (Diminishing Musharaka) with Leasing (Ijara).


Your monthly HPP payment is made up of two elements, an acquisition payment and a rental payment. When all acquisition payments have been made and the finance has been settled, ownership of the property transfers to you.


Our HPP mortgage alternatives are not exclusively for Muslims, IBB provides competitive rental rates which are attractive to everybody. Finance for your property is generated from ethical activities considered lawful under Sharia. Our administration fees are low and there are no early settlement charges, giving you flexibility with your finances.


===


> http://www.islamic-bank.com/personal-banking/finance-products/home-purchase-plan/


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Height of delusion ?

 

Reuters: Carney says UK growth driven by housing market

 

"LONDON (Reuters) - Britain's economic recovery is at an early stage and is still reliant on rising house prices and consumer demand, Bank of England Governor Mark Carney said in an interview on Tuesday. "At this stage most of the growth in momentum is coming from the household sector and there's a pick-up in the housing market from quite low levels," he said in an interview with Cardiff's Western Mail newspaper while on a visit to the Welsh capital." Well that's simply not an "economy", is it? And why is "increased activity in the housing market" seen as a good thing in the context of lending bubbles, but when you mention LVT they complain that a lot of people will have to SELL their houses? For every seller is a buyer, so LVT would really "stimulate" the housing market, wouldn't it?

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Gold price to house price ratio.

 

There was alot of talk from the gold bugs about how many ounces of gold a house would cost in the great reset and that we would all be rich. The same bloggers it would appear are very quiet now. So quiet, that the the number of hits on property and gold is very low on this forum. Maybe a sense of group think developed during 2007-2011.

 

Illustrated is a a property I was involved with on the gold to price ratio in London

 

year 2000 £250,000 value 171oz of gold

Year 2011 £500,000 value 462oz of gold

Year 2013 £675,000 value 829oz of gold

 

So property over 11 years has greatly outstripped gold as an investment.

 

Will gold outstrip property in say the next 10 years.

 

My view is as follows.

 

We are in a major property bullmarket that next year willcontinue extend to outside London, in both commercial and residental property.

 

Londons success may be its own downfall as wealth funds are seriously looking outside London to achieve rental yields 8-10% as opposed to Londons 2-3%. Also may coporates are viewing this situation closely as as global company can see the many advantages of setting outside overpriced London as;

a) cheaper rent,

B) lower wages and

c) a happy workforce.

 

Loyds Banking Group and Satander are looking to dominate market share 2014 in the residential mortgage market and will offer great teaser rates. For them it is all about selling a product. I am afraid to report that the past is but a distant memory. This has already statred and will continue till the May 2015 election, through cheaper money funds via the Central Bamk and Political will. I will state my case we are in a major bull market that will continue to run.

 

The exiting cyclee draws me to the end of 2015 were alot of 2 year mortgages will be looking for a new deal. This will be an interesting time with possibly higher interest rates and a new government. A possible dip may be evident at this point yet a new govenment I consider will only extend the current policy to 2020, or attempt to for the full duration of their term.

 

The real wobble will be, in my opinion, 2018, during which those that have currently taken out 5 year fix rate mortgages will be coming to an end and looking to remortgage in a new enonomic climate, It is at this point I consider a fall in the gold to house price ratio, ie a window of opportunity for gold bugs. Over this period a serious house price bubble wiil have formed turining down to 2020. Private conversations with a number of senior bankers in the course of my position have all confirmed that central banks have lost control of the Western world economic set up and areonly trying to manage a sinking ship as best as they can. All 3 of them gave 2022 as game over. Will this be Golds shining moment

 

The

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