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macroban Wrote:

-------------------------------------------------------

> Some up to date London data (2008-07-25) from the

> Halifax to examine.


The trouble with the building societies (and anyone else who puts out 'reports' on the housing market) is that they have their own agenda, ie they put what they want the public and the government to hear. Lies, damned lies and statistics. The things is that the market is very predictable after the event, but the reality is that no one knows what is going to happen and unlikely as it probably is it could all change very quickly. Mind you I could have my own agenda.

Benmorg - I didn't believe you so I went and checked and you are right...it just shows how long it'll take before we're back to summer 2007 again...of course, people tend to think nominally rather than in real terms so I suspect it'll seem less (especially with inflation at 4%+)

???? Wrote:

-------------------------------------------------------

> Benmorg - I didn't believe you so I went and

> checked and you are right...it just shows how long

> it'll take before we're back to summer 2007

> again...of course, people tend to think nominally

> rather than in real terms so I suspect it'll seem

> less (especially with inflation at 4%+)


it's wage inflation that matters most - not sure what that is at the moment. But yes, in real terms the kind of prices houses were selling for in summer 2007 won't be seen for a long time, probably more than a decade, or possibly never, if house prices return to historic earnings multiples. In nominal terms I'm sure they will recover eventually. Negative equity just a temporary state of affairs but must still be quite nerve-wracking to go through.

Caro ed aka mortgage broker supreme here...


Some slightly more encouraging news for us all (including me wearing my home-owner/borrower hat!) is that some better fixed rates emerged from the banks today off the back of swap rates coming down.

Not for a second that I think that is signalling a sudden return to everything being hunky dory again (which as has previously been mentioned here is going to take CONSIDERABLY longer, in my opinion the real upturn won't be for around 18 months from now) but at least a step in the right direction.

Personally I am slightly concerned about remortgaging my 2 yr fixed rate which runs out in December, mainly because I have no idea what my place is going to be valued at by a surveyor acting for a bank - all of whom are being uber cautious, and I mean UBER given the spate of down valuations I've experienced with clients of mine - and if it's sigificantly less than I'm expecting the loan to value is going to be over 75% which is the benchmark for any half decent rates. Oh the joys.


As for prices in ED in particular reaching a bottom... in my view it always comes down to supply & demand and I would say on that front that if anywhere is going to weather the storm relatively well, amongst a few others it would be our lovely ED - reasons for demand to stay up: nice victorian stock, lovely area (despite some other thread about the area having got boring... twaddle...), still within first time buyer/young professional reach affordability wise (just!), good commute to the city blah blah and supply-wise, no massive new build developments etc. Suppose the only reason supply might outstrip demand is if all the BTL'ers suddenly have to sell because the rents aren't covering their mortgage payments though...


anyway... that's my thoughts for the day. have a nice evening.

I spoke to my mortgage broker today and he thought rates might go up in the short term but be a lot lower than they are at the moment this time next year. I mean, who knows?? The local market could go further down but longer term it still has to a good bet, it's history repeating itself. And this is a very nice place to live, even if you risk the health of your liver at the monthly drinks.

we have 5 places on our road that have been up for sale for more than 6 months with no sign of them moving. meantime, estate agents are being laid off and the spectre of unemployment is rising with a lot of companies now cutting back expenditure with profits massively down.


the market has only one way to go....and that's down for the next couple of years at least. the BoE is not going to cut interest rates and allow inflation to rise, as once it's in 'the system' it's extremely difficult to stop it and it's an economically wrecking experience for everyone. so hoping that the housing market will be saved by interest rates is a pipedream.....the pain will sadly have to be endured by the fewer souls who bought at the top of the market on low fixed rates at the wrong time.

Booboo2008 Wrote:

-------------------------------------------------------

> the market has only one way to go....and that's

> down for the next couple of years at least. the

> BoE is not going to cut interest rates and allow

> inflation to rise, as once it's in 'the system'

> it's extremely difficult to stop it and it's an

> economically wrecking experience for everyone. so

> hoping that the housing market will be saved by

> interest rates is a pipedream.....the pain will

> sadly have to be endured by the fewer souls who

> bought at the top of the market on low fixed rates

> at the wrong time.


I wouldn't be so sure about interest rates not being cut. Energy prices are starting to fall from their highs and energy and food price increases have been the main cause for increased inflation. Cuts over the next 6 months or so are possible.

I concur nutty. Consumer confidence needs a serious boost so if/when inflationary pressures ease I reckon the MPC will go for a cut. I for one am 99% sure i'm going for a tracker as opposed to fixing when I remortgage particularly as a number of lenders are starting to reduce their margins at last (even though they are still charging through the nose on arrangement fees for the good rates most of the time)

dream on....the only energy prices that have fell in recent weeks is the oil price....electricity and gas are still on the up....and oil may well rise significantly again as we approach winter.


the real issue here isn't interest rates on their own....it's a combination of them, consumer confidence and disposable income....the latter 2 are in the doldrums and show no signs of improving.

woody Wrote:

-------------------------------------------------------

> dream on....the only energy prices that have fell

> in recent weeks is the oil price....electricity

> and gas are still on the up....and oil may well

> rise significantly again as we approach winter.

>


depends whether you're talking about prices we as consumers get or those the energy companies are paying I guess. Seasonality isn't particularly important to consumers as the energy companies obviously ride that for us. It's the overall trend that will be important.


I am in no way suggesting I can predict the market - just pointing out that commodity prices aren't guaranteed to keep going up as quite a few commodity investment funds have recently found. http://www.ft.com/cms/s/0/03ca4db2-5a7b-11dd-bf96-000077b07658.html

woody Wrote:

-------------------------------------------------------

> the real issue here isn't interest rates on their

> own....it's a combination of them, consumer

> confidence and disposable income....the latter 2

> are in the doldrums and show no signs of

> improving.


totally agree - although consumer confidence can be very fickle

You wouldnt ask a double glazing salesman if your old sash windows were good enough to last another 20 years, so why take any notice of what estate agents say ?


as someone who knows how the city works ( as do many on here I suspect ), it is imposible & foolhardy to call the bottom of a cycle until its happened.

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