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UK House prices: News & Views

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This HPC will be much, much worse than 1990.

 

According to this, we are witnessing a once-in-several-lifetimes event.

 

Frontrow seat.

 

http://www.wolseysec...news.php?id=566

QUOTE

Activity levels down over 60% from last housing market crash

Monday 18th August 2008

 

Wolsey calls for Government action or face the consequences. While the Government continues to flounder on the sidelines, activity in the housing market has sunk to an unprecedented low level. Wolsey Securities is calling on the Government to take urgent action, as activity falls to a low level that even surpasses the slump during the last housing market crash.

 

With the Bank of England figures showing that only 36,000* mortgage approvals were made in June, the number of housing transactions is currently set to total just over 400,000 this year. This low level represents over a 60% drop in activity on the worst year of the 1990s housing market crash, when transactions ran at around one million.

 

Mike Ratcliffe, chief executive of Wolsey Securities, comments: "Transaction levels have now dropped to dangerously low levels that have not been seen in several lifetimes. The housing industry cannot sustain this level of trade. Housebuilders are on their knees. If there isn't an improvement soon many will fold, as their cashflows will not be able to meet overheads and interest costs.

==== ====

 

UPDATED - by DrBubb:

The A-B-C down in UK Property prices, still needs a C down, before it bottoms

Back in 2008, this chart was posted on GEI:

 

001th4.png

 

So what happened ?:

 

Since 2002:

 

hw2002.png

 

Since 2009: (up to June 2012: £164,489)

Latest: Oct. 2012 : £161,986

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According to this, we are witnessing a once-in-several-lifetimes event.

 

Frontrow seat. :o

 

http://www.wolseysecurities.co.uk/news.php?id=566

 

Latest take from our friendly estate agent says even they don't expect full recovery until 2012, somethings you can't deny, but you can still dress it up ;)

 

http://www.savills.co.uk/news.aspx?id=9936

 

19 August 2008

 

The End Of The Tunnel Is Nearer In The South

The number of transactions in the housing market is half last year's levels and the number of housing starts is likely to fall even further. Supply could therefore become constrained in many markets over the coming months. This means that when the market does bottom out, it may be difficult for investors to make acquisitions. For anyone looking to invest, knowing which regions of the country are likely to recover first and fastest is essential to avoid being timed out by a rising market.

 

 

Savills Research has forecast not only the duration and size of the market downturn but also the shape and timing of recovery. Their recovery map forecasts the year in which values will have returned to 2007 levels by UK Government region. It also shows the size of the subsequent house price growth that might be expected by 2020 by recording falls and subsequent rises.

 

Savills recovery map suggests that London and the South-East will lead the recovery and will quickly return to former levels, by 2012 whilst, in the North-East and Northern Ireland for example, any upturn will occur later and full recovery is unlikely until 2016.

 

Yolande Barnes, head of Savills residential research explains, "This property market downturn has affected virtually all property sectors and UK regions simultaneously but regions will vary far more when the upturn comes.

 

"The lack of turnover and new supply which is such a feature of this downturn will be likely to lead to sharp increases in value in high-demand, low supply areas. Competition amongst homeowners will once again lead to rising prices, particularly in those areas with higher levels of housing market equity and stronger household purchasing power such as London, the South East and Scotland".

 

Key findings include:

 

London and the South East will lead the recovery so that, by 2012, values will have recovered to those pre-slump.

Between 2008 and 2020 average growth in the South East will be +79%.

Scotland will also have recovered by 2012 with growth between 2008 and 2020 averaging +47%.

On the downside, Northern Ireland and the North East are forecast not to have recovered until 2016 with average growth between 2008 and 2020 of +33% and +19% respectively.

Barnes again, "This downturn is severe and will almost certainly last for at least another year. But it is has been caused by the withdrawal of credit, not the withdrawal of long-term demand or by diminished purchasing power amongst owner occupiers. It is this that will shape the recovery when it comes. Although the credit crisis has affected all sectors and regions more or less equally and simultaneously, we will see a very different pattern in the recovery. Canny investors will take this into account now".

 

 

 

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According to this, we are witnessing a once-in-several-lifetimes event.

 

Frontrow seat. :o

 

http://www.wolseysecurities.co.uk/news.php?id=566

 

And now HMRC withhold their figures for this month: http://news.bbc.co.uk/1/hi/business/7572603.stm

 

Presumably the method/mechanism of calculation has not changed, so it will be interesting to see what the explanation for this is.

 

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And now HMRC withhold their figures for this month: http://news.bbc.co.uk/1/hi/business/7572603.stm

 

Presumably the method/mechanism of calculation has not changed, so it will be interesting to see what the explanation for this is.

Are they so shocked they simply don't want to publish them?? :o

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Why is there a constant stream of people demanding the government "do something"? Just what are the government supposed to do? :unsure:

 

Blaming PM Brown, I suppose.

His failed policies are a major cause

 

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http://www.bloomberg.com/apps/news?pid=206...&refer=home

London Real Estate Shakeout Means REITs Lose 50% on Attrition

...

Aug. 22 (Bloomberg) -- London developers are adding the equivalent of 160 trading floors of office space in the main financial district in the next two years. Their timing couldn't be worse.

 

Prices for offices in the City of London have plunged 25 percent since last August, the biggest drop since 1992, according to Investment Property Databank Ltd., and rents are declining for the first time in four years, said CB Richard Ellis Group Inc., which estimates rents may drop by a quarter by the end of next year. The commercial property market won't recover until at least 2013, said Mike Prew, a real estate analyst at Lehman Brothers International Europe in London.

 

U.K. property stocks have fallen by more than half since Britain introduced real estate investment trusts in January 2007. The shares may fall by another 23 percent by the end of 2009 as building values decline and the country slides into a recession, said Morgan Stanley analyst Martin Allen. He has the lowest price target of any analyst covering British Land Co., the biggest landlord and developer in the City.

 

``We don't have a supply problem, we have a demand problem,'' said Patrick Sumner, head of real estate securities at Henderson Global Investors in London, which owns 1 billion pounds of property stocks. ``Tenants are not going to take big decisions until things are clearer than they are now.''

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Why is there a constant stream of people demanding the government "do something"? Just what are the government supposed to do? :unsure:

 

They could impoverish the next generation by bailing out the stupid and greedy from this generation for starters. :rolleyes:

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And now HMRC withhold their figures for this month: http://news.bbc.co.uk/1/hi/business/7572603.stm

 

Presumably the method/mechanism of calculation has not changed, so it will be interesting to see what the explanation for this is.

 

People are too quick too jump to conspiracy theories when it comes to governments. Usually it is just incompetence.

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Bradford & Bingley's Mortgage Bonds Cut by Moody's

 

http://www.bloomberg.com/apps/news?pid=206...GE&refer=uk

 

Aug. 22 (Bloomberg) -- Bradford & Bingley Plc, the U.K.'s biggest lender to landlords, had its top-rated mortgage bonds downgraded by Moody's Investors Service.

 

Moody's cut the covered bonds one step to Aa1, the New York- based ratings company said in an e-mailed statement today. The bonds of the Bingley, England-based lender remain on review for ``possible further downgrades,'' according to the statement.

 

...

 

Late loan repayments have surged amid the worst U.K. housing slump since the 1990s, also harming Bradford & Bingley's business. The mortgage lender said late payments rose to 3.3 percent of all loans as of August. Its market value has tumbled more than 80 percent in the past year.

 

...

 

``This is not just a downgrade, it's a downgrade with a watch negative, which is a strong indication that the rating will go down further,'' said Florian Hillenbrand, a covered bond analyst in Munich at UniCredit SpA, Italy's largest bank. ``Nobody knows where it will end.''

 

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http://uk.reuters.com/article/stocksNews/i...lBrandChannel=0

Banks face double property crash

...

LONDON (Reuters) - British banks are facing big difficulties, as what amounts to a crash in both housing and commercial real estate threatens to devastate their loan portfolios.

...

"The government are going to have to step into the breach. The consumers are borrowed to the hilt and the banking sector is no longer able to provide the consumer with credit. Unless they want to see a major collapse in the financial sector, the government will have to fund the difference and borrow a lot more."

 

The banks too are flying into the storm with very little put aside as insurance. British residential property loans have done fantastically well during the past decade, arguably making lenders complacent.

...

It is not just capital values which are falling in commercial real estate. Britain's economy and its once vibrant financial sector are being hit hard and many tenants may stop paying rent.

...

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While we're comparing house-price crashes:

 

crashcomparisonev6.th.jpg

 

(Assuming this whole ImageShack thing works... ;) )

 

According to the Halifax data, we have done 39 months of damage in the first 11 months. And most people I know are still claiming ‘house prices may fall a bit, but they won’t crash’.

 

Why does your nationwide line start 2 years in?

 

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Why does your nationwide line start 2 years in?

 

Because the Nationwide monthly data I have doesn't go as far back as the Halifax data.

 

Assuming I haven't just overlooked a better dataset, if you take a look on Nationwide's website, their historical monthly data only goes back to '91.

 

It's a conspiracy! ;)

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Because the Nationwide monthly data I have doesn't go as far back as the Halifax data.

 

Assuming I haven't just overlooked a better dataset, if you take a look on Nationwide's website, their historical monthly data only goes back to '91.

 

It's a conspiracy! ;)

 

UK Series - House prices since 1952 :D

 

Quarterly. You'll just have to fiddle it by hand :D

 

Nice chart. I look forward to the updated version :P:lol:

 

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Thanks for the link, but I do already have that. It's just that I didn't bother with it as it's quarterly data.

 

I could just do a bit of averaging (or something), but I had the vague nagging doubt that quarterly data isn't just monthly data added up for three months. I can't back this up with any maths you understand, but it did occur to me that just 'playing jazz' with the quarterly data might produce misleading results...

 

Perhaps someone else can make soothing noises about doing this... or just tell me the best way to produce good monthly figures from quarterly data, and, hence, a new chart! :)

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Thanks for the link, but I do already have that. It's just that I didn't bother with it as it's quarterly data.

 

I could just do a bit of averaging (or something), but I had the vague nagging doubt that quarterly data isn't just monthly data added up for three months. I can't back this up with any maths you understand, but it did occur to me that just 'playing jazz' with the quarterly data might produce misleading results...

 

Perhaps someone else can make soothing noises about doing this... or just tell me the best way to produce good monthly figures from quarterly data, and, hence, a new chart! :)

 

Save a copy before you start.

 

1. Copy and paste the data from the linked spreadsheet in to your spreadsheet. Date (quarters) and Price

2. Press CTRL and H

3. Type ‘Q1 ‘ in the first box and ‘01/01/’ into the second box. Then click ‘Replace All’ (note, there is a space after Q1)

4. Do the same for the other quarters

5. Right click the chart and select ‘Chart Type’. Change to ‘XY (scatter)’ if it isn’t already selected

6. Now add the new data line

7. Right click the new data line and select ‘Format Data Series’. On the patterns tab, you can match the line type to the other nationwide line so they both look the same.

 

The Nationwide data will look like it is one continuous line switching from quarters to months (but it will be shown twice on your key)

 

Come back to me if this wasn’t clear

 

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Save a copy before you start.

 

1. Copy and paste the data from the linked spreadsheet in to your spreadsheet. Date (quarters) and Price

2. Press CTRL and H

3. Type ‘Q1 ‘ in the first box and ‘01/01/’ into the second box. Then click ‘Replace All’ (note, there is a space after Q1)

4. Do the same for the other quarters

5. Right click the chart and select ‘Chart Type’. Change to ‘XY (scatter)’ if it isn’t already selected

6. Now add the new data line

7. Right click the new data line and select ‘Format Data Series’. On the patterns tab, you can match the line type to the other nationwide line so they both look the same.

 

The Nationwide data will look like it is one continuous line switching from quarters to months (but it will be shown twice on your key)

 

Come back to me if this wasn’t clear

 

*starts to gibber*

 

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It has gone eerily quiet on the government house price saving masterplan. I wonder what the fools may be scheming over next?

 

The Liberals have come up with a plan of their own.

 

http://news.bbc.co.uk/1/hi/business/7583934.stm

 

** to buy empty properties and developers' land-banks to increase the amount of social housing.

 

** Mr Cable also called for lenders to go through the full and proper court process to repossess homes.

 

** A proposal for a new, regulated mortgage rescue plan would allow those who were unable to make repayments on their home loan to stay in their property as tenants.

 

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