what will the interest rate cut do to house prices?

confused31_2

pickledpink wrote: »

Property prices will start to rise far more quickly now that interest rates are sooooo low!

People will be able to afford a mortgage. It will be cheaper than renting!

So...............more buyers buying...........more properties selling..........property prices will then start to rise.

I can foresee people missing the boat again if they don't buy now. They'll be kicking themselves for being so cautious.

You can wait forever sometimes..............and then you're too old to enjoy it. Shame!:money:

shes trying to get her job back as a estate agent, its no good talking up the market.:rotfl:

confused

Kenny4315

There's some significant amounts left to still drop yet. I think that we will proably be falling well into next year with the main falls hitting the markets by june/july. My view is there will then be a 18 month to 2 year period of level prices. Following that we shall then get into the predictable BUY cycle. If your buying I reckon mid-next year will be a good time, and then negioate hard at this point which could get you a real discounted property. In terms of amount of fall well something along the lines of a further 15 % by end of june seems about right.

Generali

JayScottGreenspan wrote: »

A lot of people on this thread are deliberately misinterpreting ........doesn't constitute an argument, it adds nothing to the debate, and it's pretty childish.

Welcome to the board. There's a lot of that round here.....

mr.broderick

Kenny4315 wrote: »

There's some significant amounts left to still drop yet. I think that we will proably be falling well into next year with the main falls hitting the markets by june/july. My view is there will then be a 18 month to 2 year period of level prices. Following that we shall then get into the predictable BUY cycle. If your buying I reckon mid-next year will be a good time, and then negioate hard at this point which could get you a real discounted property. In terms of amount of fall well something along the lines of a further 15 % by end of june seems about right.

Interesting put offers in on 2 properties the other day, cheely offers.
Phone calls today from ea's saying vendors had accepted near asking offers from ftb'ers. I tried to call their bluff and visited one of the properties and spoke to the vendor who confirmed offer had been given.

IveSeenTheLight

dopester wrote: »

Well... without really wanting to get in to the subject... my source for the affordability figures was close to your area, so I presume they have good data for their report and analysis:

Source: Aberdeen City Council
http://www.aberdeencity.gov.uk/ACCI/...=13760&sID=332

Together with many another chart:

Thanks for the link, I genuinely appreciate any links to fact or statistics.

Recently, I've decided to scrutinise stats deeper to fully understand what the data represents.

Data can contain flaws such as reported on here that Nationwide and HBOS are only a small percentage of mortgages and report only approved mortgages, not actual sales leads me to believe that it is better to try to get to a better source of info.

Dont get me wrong, I believe Nationwide and HBOS can be used as a guideline as long as it is understood that they are only a proportional representation.

I now am following the LR figures or for my area the Registers of Scotland Executive (RoSE) for better actual reported sales.

Looking at your data, there are two flaws I believe.
Firstly, house prices are taken from HBOS, which as above is not the best but I can accept for a guideline.
More importantly, the average earnings was taken from the Annual Survey of Hours and Earnings (ASHE), a UK total of 142,000 or approx 0.23% of the UK population. Couldn't find an up to date link for the recent figures, but in 2003, it was based on a survey of 492 persons for the Aberdeen area. It also doesn't include self employed persons, which there are quite a high number in Aberdeen.

Taking a step back however, it is easy to see how the figures can be represented as you have shown.

Once again, thanks for the links

Generali

IveSeenTheLight wrote: »

Thanks for the link, I genuinely appreciate any links to fact or statistics.

Recently, I've decided to scrutinise stats deeper to fully understand what the data represents.

Data can contain flaws such as reported on here that Nationwide and HBOS are only a small percentage of mortgages and report only approved mortgages, not actual sales leads me to believe that it is better to try to get to a better source of info.

Dont get me wrong, I believe Nationwide and HBOS can be used as a guideline as long as it is understood that they are only a proportional representation.

I now am following the LR figures or for my area the Registers of Scotland Executive (RoSE) for better actual reported sales.

Looking at your data, there are two flaws I believe.
Firstly, house prices are taken from HBOS, which as above is not the best but I can accept for a guideline.
More importantly, the average earnings was taken from the Annual Survey of Hours and Earnings (ASHE), a UK total of 142,000 or approx 0.23% of the UK population. Couldn't find an up to date link for the recent figures, but in 2003, it was based on a survey of 492 persons for the Aberdeen area. It also doesn't include self employed persons, which there are quite a high number in Aberdeen.

Taking a step back however, it is easy to see how the figures can be represented as you have shown.

Once again, thanks for the links

FWIW, every analysis of LR and Haliwide I have seen has shown that the three sets of figures are consistant as long as you factor in a lag of about 3-4 months for the LR figures.

StevieJ

Some good news, a friend of mine has just sold his house for 97% of asking price, not in the land registry figures yet but promising.

North_Sea_Bubble

Realy wrote: »

How?

I think it will make it even harder for FTB to borrow.

When banks lend money they balance risk against return. The government has ordered them to reduce their return, so I would expect them to correspondingly reduce risk by further tightening their lending criteria and increase arrangement fees.

WTF?_2

EdInvestor wrote: »

Northern Wreck has cut its SVR by the full 1.5%, could make a significant difference to the repo problem.

I doubt it - people simply borrowed too much - up to the limit (or more) of what they could actually repay given the cheap 2-year fix on offer at the time.

Unless SVRs go to the level of said cheap fixes they are going to keep defaulting. Most of their 'better quality' customers have fled to cheaper deals leaving their books full of the dregs who lied about salary, bought at 100% or greater LTV etc.


And factor in increasing unemployment and many people won't be able to afford to pay, period. IO mortgages with the welfare system paying the interest will be the way to go for them.


Can't wait to see the new eSaver rates. I've got a few tens of K in there. will be coming straight out if they 'pass on the interest rate cut' to savers like me. I suspect many others will think likewise, especially now that the government is underwriting practically half the UK banking sector making it as 'safe' as NR.

Such a pity as NR were making good progress in repaying the UK taxpayer until Brown threw down the clunking fist.

Kenny4315

mr.broderick wrote: »

Interesting put offers in on 2 properties the other day, cheely offers.
Phone calls today from ea's saying vendors had accepted near asking offers from ftb'ers. I tried to call their bluff and visited one of the properties and spoke to the vendor who confirmed offer had been given.

You were lucky then, unless your offer was 15% lower than asking price.