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UK housing market 2008 and beyond .........
UK housing market 2008 and beyond .........
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Telegraph
Interest rates will go up quicker than anyone expects, ex-Bank of England officials warn Interest rates will have to rise earlier and more sharply than expected to keep inflation under control, two former Bank of England policymakers have warned. By Philip Aldrick , Economics Editor Published: 6:00AM BST 04 Aug 2010 Sir John Gieve, a former member of the MPC, has little doubt that the Bank will raise interest rates - and quickly Sir John Gieve, an ex-deputy Governor, and Charles Goodhart, a previous member of the Monetary Policy Committee, are the most senior economists yet to have opposed the current orthodoxy that rates will stay low for a prolonged period. The warning will come as a relief to savers but as a shock to homeowners, many of whom are able to meet their mortgage repayments only because of record low rates of 0.5pc. Addressing Fathom Financial Consulting’s Monetary Policy Forum, Sir John said: “I am expecting a recovery – when that is strongly established I’d expect rates to start rising faster than the market currently expects. I wouldn’t be at all surprised to see interest rates at 2.5pc a year from now.” Sir John added: “I think the Bank will have learned a lesson from the Greenspan years after the dotcom boom when the US was very slow to raise rates back to normal levels. When the Bank thinks recovery is established they will want to normalise quite quickly.” Mr Goodhart is less optimistic about the economy but fears the Bank will have to raise rates to tame inflation as food prices soar. The price of bread is poised to climb after wheat futures rose in July at their fastest monthly rate in 51 years, partly a result of wildfires in Russia’s fertile Volga River region. Data from the British Retail Consortium (BRC) today shows that food inflation increased from 1.7pc in June to 2.5pc in July, fuelling Mr Goodhart’s fears |
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I am not convinced. This recovery is by no means guaarnteed.
I am unsure that the fact that a loaf of bread is increasing in value will have that much of an effect. I am more concerned about the price of wine TBH.. No 3 for a tenner in tesco, it is now 3 for £12. |
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What's that inflation running at 20% in the Chisel household yet still the man cries out cheap money?
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Its great news for you and me chis[:D][:D]
chisel , my business would do much better if rates were to rise slightly![:x] |
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I am still convinced that the irrational faith that the Great British Public put on house prices will mean the downfall of house prices.
House prices are so high and people spend a cripling amount of their income on house purchases not becasue of supply and demand but because of misplaced confidence. The is question is wether this condidence is unassailable. Well the Governement has been printing money for a while now and looks like it is intending to do so for the foreseeable future. Can they succeed in keeping reality away from the awareness of house buyers and sellers? Actually I hope; so a soft landing rather than a collapse is prefferable. However to me sentiment seems to be teetering and tottering despite all the pump primimg and the claims of "Great News the building sector has beat the recession " etc. I cannot see past another dip when the Tories implement their Autumn slash and burn. And when the dip comes house price confidence evaporates and down they go. |
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So banks making billions is not a sign of things improving. BOE and governemnt knows that ay rates rises are likely to affect the banks in a negative way.. They want their money back form the banks!! If thety can make a profit for teh taxpayer then great.
Bank of England has made billions from lending to banks, and I can see no reason this will stop in teh short term. |
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Good News regards repossessions , particularly for teh banks and of course the taxpayer
siA total of 9,400 homes were repossessed in the three months to the end of June, down 400 from the previous quarter, and 2,400 below the figure for the same period of 2009, according to the Council of Mortgage Lenders (CML). The figure led the CML to revise its forecast for total repossessions in 2010 as a whole - it now predicts 39,000 repossessions for the year, compared with the previous estimate of 53,000. The number of mortgages behind with payments also fell. At the end of June there were 178,200 loans with arrears equivalent to 2.5% or more of their mortgage balance, 5% lower than at the end of March, and 17% lower than a year earlier. The CML expects 175,000 mortgages to end the year 2.5% or more in arrears, compared with the previous forecast of 205,000. Low interest rates, increased lender forbearance and the introduction of Government schemes to help those struggling to keep up with their mortgage have helped to reduce the figures. However, the CML warned that any hike in interest rates and a rise in unemployment could put borrowers in a precarious position, and urged the coalition government to maintain its support for homeowners. CML director-general Michael Coogan said: "Mortgage difficulties have so far been contained at lower levels than we expected at the start of the year, and by comparison with the 1990s recession." He added: "We hope the coalition government will not risk undermining the chances of extending the welcome trends this year by removing support mechanisms that work." |
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So much for the "can't happen here" north/south divide theory.
House prices in the South East fall significantly Published 10 August 2010 More surveyors reported a fall rather than a rise in South East house prices as supply continues to outstrip demand and more properties come on to the market. This is according to the latest RICS UK Housing Market Survey. In July 15% more surveyors reported a fall rather than a rise in house prices, a steep fall of 30% from June, when 15% more surveyors were optimistic that prices would rise. Demand for property in the South East, measured by the net balance of new buyer enquiries, fell slightly for the second month in a row, from negative 22 to negative 24. Difficulty in securing mortgages and increased uncertainty about the prospects for the economy may have contributed to caution from potential homebuyers though the excess of supply over demand is central to the market. The number of new vendor instructions in the South East increased markedly across the region, with 35% of surveyors reporting a rise rather than a fall in the number of properties coming onto their books, up from 21% in June. Since the abolition of HIPS in May this year and the changes to Capital Gains Tax, more homeowners seem keen to test the property market. |
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Even better news for the taxpayer.
By Myra Butterworth, Personal Finance Correspondent Published: 12:04PM BST 12 Aug 2010 Repossession threat The latest repossession statistics showed numbers dropping after the Government introduced several measures for home owners who lost their jobs amid the economic downturn. But some of this support is now being reduced. It includes Support for Mortgage Interest, which is paid to those on income-related benefits – such as Job Seeker’s Allowance – at a rate of 6.08 per cent. This has prompted the Government to announce that it is cutting the rate to just 3.75 per cent from October 1. The new rate is based on the average mortgage rate provided by the Bank of England. |
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Average drop of 4k last month, here comes the correction, hold onto your hats.
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just got a new 2 year tracker mortgage , Hopefully rates not going up much in next 2 years
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Hey chisel a word of advice for you old boy. If the ride down makes you feel a little queasy may I suggest when you call for you Uncle Hughie that you bite down if you think a doughnut is exiting your mouth. Don't let that sucker get away because it is your ring piece and they don't sell those at Halford's.
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LOL
There is no chance of a DD and the housing market will be protected at all costs. A stable housing market means teh banks are surviving well and th taxpayer is making a profit.. Dont get tooo excited doom mongers, if prices fall it will not be by much and will not be for long!! Clueless I do not think you will regret taking a tracker for two years. good luck to you! |
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so they're not going down then?
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Oh yes they are. Quicker than fat boy chisel on a quarter pounder.
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Dont get tooo excited doom mongers, if prices fall it will not be by much and will not be for long!!
If anyone finds a spat dummy, could they return it to chisel.Was it just a few months back you were announcing your victory, claiming the "doom mongers"(realists) had fled to other sites, afraid to face you! |
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Another property crash predicted... the doom mongers have got it wrong for the last 10 yrs and still no crash. How many people have had their homes repossessed ? Worst recession since the 30s and still no crash ? I think the shortage of property in the country overrides the fact that there are unemployment fears etc. All roads lead to the property market so quiet for another 2 yrs they it will pick up
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Another property crash predicted... the doom mongers have got it wrong for the last 10 yrs and still no crash.
Don't recall anyone predicting a property crash 10 years ago, why would they? we hadn't long been recovering from the previous one! Not many predicting an actual crash today, just a slow downward spiral for prices. |
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Potlis
Prices being where they are is an ENORMOUS victory for me thanks. You have to remember properties have clawed back 10% from the lows. Some were predictiong a further 10% dip from teh lows so prices are actually 20% higher than the Doom Mongers predicted.. Prices are not going to fall too far from here in my opinion, although it is fast becoming a buyers market once more! |
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chisel 24 Aug 10 14:07
chisel 24 Aug 10 14:07 Prices being where they are is an ENORMOUS victory for me thanks. You really think it's all over ?? Prices are not going to fall too far from here in my opinion, although it is fast becoming a buyers market once more! Basically contradicting yourself here , so what happens when it's a buyers market as you are saying it is ?? |
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how does one man produce so much sh1t?
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Poor chisel. Fallen off a cliff and on the way down he is bragging that it hasn't hurt.
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Chisel----No mention of the latest mortgage approval figures.
Figures from the British Bankers' Association showed that new approvals for home loans dipped from 34,575 in June to 33,698 in July, and were well down on the 41,400 seen in July 2009. And the mortgage broker claims an ENORMOUS victory. The game is up,and Chisel knows it. |
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You have to remember properties have clawed back 10% from the lows. Some were predictiong a further 10% dip from teh lows so prices are actually 20% higher than the Doom Mongers predicted..
As I recall, to a lesser degree, you were firmly in the "Doom Mongers" camp yourself back then chisel, though the fact you change your mind/opinions every few weeks does tend to muddy the waters. From what I'm seeing locally the race is just getting interesting, the field is about to set out on their second circuit with two miles, beechers and the chair still in front of them, still anybodys race, but Merv has dropped his whip and lost his irons, and now looks a spent force  |
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Grey Shark
If it wasnt a buyers market prices would still be increasing. It is not a matter of how far prices will fall but a question of by how far. My opinion is that prices are likely to dip a little,but we will not see anywhere near 10% with 5% nbeing the maximum. Banks have the property market in their hands, and if they want to see stable prices it is an easy solution to find. |
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Chisel,
What does this sentence mean? It is not a matter of how far prices will fall but a question of by how far. |
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I think he means 'it's not a matter of whether . . but by how far'
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I think he doesn't know what he's talking about .... as usual ,
just says or types the first thing that pops up in his pea sized brain . |
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fairview homes offering homebuy and trying to get rid of 1 and 2 bed flats.
difficult to see where the market is heading. I am just saving for a bigger deposit. |
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this is greenhithe btw
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And over to our roving reporter in our Edinburgh studio Jock MacChisel:
Tell us Jock what does the future hold for house prices? Och well we can be quite sure about that. They won't fall. They simply cannot fall. I asked 10 estate agents this morning and they were quite clear about that. Selling like hot cakes apparently. In fact so quickly were they flying off the shelves they have started a special closing down sale. One think we can be sure of is that nothing is safer than bricks and mortar. House prices only ever go up. The only time they don't go up is when they go down or stay the same. So as you can see the outlook is sunny. My word is oak and house prices will only go up from here. Quote me on it. Unless of course they go down a bit before they go up. Either way get back to me in a few months and you will see I have maintained my 100% forecasting record as they will definitely have gone up, or down prior to going up. Unless the market takes a rest on the stairs whilst it gets its breath back for the move up to the next level. Remember, a ladder only goes up and that is what we are dealing with - a ladder. Not a real one of course but a property one and they are made of something much stronger than mere steel or aluminium. Confidence is what it is all about and I am seeing a lot of confident people in my mortgage brokerage today. Oh yes. Come to pappa. Thank you Jock. And now a special report from Gobble D **** on why the Turkeys have cast their vote in favour of Christmas this year. |
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LOL
I am glad you have got a sense of humour, despite living in other peoples houses and paying them rent.. You must all be so pleased with your selves!! In Bognor Regis, there is literally NO property left to rent. Millions of people are desperate to buy , but unfortunately can no longer get the finance at a time when mortgages are at their cheapest every level!! It really does make me laugh that you doom mongers pour scorn on my predictions. It is funny, because I agree that the property market is unlikely to see significant growth for the forseeable future. THE THING I DISAGREE WITH YOU ABOUT IS THAT PRICES ARE GOING TO CRASH. THEY ARE NOT! Average wages have not increased anywhere near enough over the past ten years for the country to have any problem with inflation going forward. For this reason there is a real time bomb for BOE policy makers. It is absolutely inevitable that interesdt rates are going to have to stay low for years |
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In Bognor Regis, there is literally NO property left to rent. Millions of people are desperate to buy
Millions? Feck me Bognor must be busy. |
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They may have to start doing long lets at Butlins.
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Quite Right!!
Of course when I say millions I refer to the country and not just Bognor!! Although of course Bognor is representative of much of the UK... The shortage of property to let is quite astonishing locally |
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And having looked like the market was stalling lately , there has been a huge increase in sales being agreed by local agents... and at decent prices as well. Quality property appears to be holding up well.
There are also some interesting improvements in mortgage rates, with rates being slashed at 85% lately. Rates sub 75% are falling gradually also, and those with equity can get some great deals! / |
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chisel 26 Aug 10 13:22
The shortage of property to let is quite astonishing locally Just looked on rightmove for available property to rent in Bognor , search criteria was .... Bognor - this area only Any property NOT let agreed 109 available of which 69 are flats . Change the search to Bognor 3 mile radius and you get 232 available of which 140 are flats So there is no shortage of good quality properties to rent in your area , so your either lying or just have no understanding of your local market .... i suspect it's a combination of the two , either way you've just proved yet again that your full of sh1t. |
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He He,
Yes Sharky I had a look too, being a londoner my eyes almost popped out my head at how low the rents were, but then who wants to live in Bognor?? |
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Washington - we have to trust chisel he's a good honest mortgage broker , he says so himself .
The first page of lets in Bognor had 5/6 bedroom houses at up to 2k a month rental , they sure look like properties where the owner refuses or can't drop the price so tries to rent it out until the market recovers . On current values these clowns will be getting between 2-3 % yield after expenses , tax , voids etc. |
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wonder if he lies to his clients as much.
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