Property confidence back to 2007 levels; Beware

The article linked to below shows that confidence in rising house prices is now at the level it was in 2007. It seems that when the majority believe prices will go up then they go down and when the majority thing prices will go down then they go up (see confidence at the beginning of 2009).


Does this mean that prices are about to go down? I don’t know about that but it does show that you can’t trust surveys on confidence.


http://www.thisismoney.co.uk/mortgages-and-homes/house-prices/article.html?in_article_id=502424&in_page_id=57

UK General Election 6th May 2010

Your choice on who to vote for but for god’s sake vote. Especially you youngsters.

UK House prices. A long term Bear Market?

This article picks up on my point (see previous post) about inflation adjusted house prices.


http://www.telegraph.co.uk/finance/economics/houseprices/7557222/UK-house-prices-face-prolonged-bear-market.html

UK Savers Pay for house price increase in March 2010

House prices increased by 0.7% in March 2010 according to the Nationwide. This figure is seasonally adjusted. The actual increase was 1.98%
You might wonder who is paying for these expensive houses in march? Well it’s you, well done. It’s not the owners as they have very low interest rates and inflation is reducing their debt. Nice for them but someone has to pay for that and fortunately there is you. As long as you don’t complain then things will go on like they are.

UK savers petition the government

It’s about time we started protesting.
This is a start

http://petitions.number10.gov.uk/Savingsrate/#detail

but I really think we should go to the next meeting of the bank of England.

This is another website. We need more of this
http://www.saveoursavers.co.uk/

UK House prices; the last two bubbles and Inflation.

As promised, I have got hold of UK house prices since the peak in 1989 and have a plot of raw house prices (Halifax) and inflation adjusted from 1989 to February 2010. The plots are at the foot of this post. Interestingly you can see that house prices have fallen by more this time (21.9%) than in the last crash (14.7%). Incidentally today’s prices are 17.5% below the August 2007 peak.


The last crash resulted in a bounce along the bottom for several years and did not return to it’s 1989 peak until March 1998. More interestingly however, prices adjusted for inflation (CPI) did not return to their peak until February 2002.

It would be unwise to try and predict where prices will go this time. They could bounce along the bottom for a few more years yet, as they did after the last crash. However one thing that we can perhaps be more certain about is that if we adjust for inflation then prices will not return to 2007 levels for a few years longer still.

House prices fall by 0.3% in February (Land Registry). London prices fall 0.45%

Houses prices were down 0.3% in February according to the land Registry. The average number of transactions per month (over September to December 2009) was 63,687 compared to an average of 39,892 for the same period in 2008. So volumes are up, which should be good.

Some might be interested to know that prices in London have shown the first drop since May 2009. Overall prices in London dropped by 0.45%. This was consistent over all property types (Detached, Semi-detached, Terraced, Maisonette/Flat, ALL)