Aberdeen/shire house prices

IveSeenTheLight

donaldtramp wrote: »

I still stand by my thoughts. For the short to medium term house prices for Aberdeen/shire are on a shoogly nail and long term it looks real bad.

go on, be bold, name a percentage.
Are you one of the 70% crew?
Going by your beliefs in how dreadful Aberdeen will be, you must be thinking that at least

donaldtramp

You agree that it happened previously and then seem to iterate its a result of the credit crunch

Once again, its a result of the low oil price and will happen again in the future despite the liquidity of credit. The operators are trying to protect their profit by getting taxes reduced

I meant the Oil price has dropped due to the credit crunch, less demand.
I would say that the operators are trying to make a profit this year. Profits are going to be way, way down, that will affect everyone suppliers, contractors and employees.

I've read some of your other posts in other threads and you think the same, Aberdeen is not immune.
Seems we are saying the same thing about prices going to go down, I'm just sick of hearing the usual nonsense peddled by everyone who stays in Aberdeen saying "we're different" "we've got the oil" etc etc etc
It will come to an end.

As for overseas work, I do agree we do have a technology/experience advantage at the moment. That will be eroded. It's back to the British Motorbike industry analogy again. Companies are setting up manufacturing plants in Poland, Malaysia and other low cost countries, I know I have had to compete against them to win work and it is getting harder. Why on Earth would you compete with the wages paid/lead times for gear in Aberdeen when you can buy the same kit for one fifth of the price (a genuine problem I've faced) from China or the likes? Chinese(as one example of such a country) machinists, fitters and engineers are much, much cheaper than Aberdonians.

Long term when the oil runs out , we will be producing one fifth of peak production rates (1999) by 2020. (It is in the Subsea report I posted up earlier)
Why on Earth would you continue to build equipment and hire people from an expensive area such as Aberdeen when that happens?

As for the 70% drop, I'm nowhere near that!!
I reckon there will be a good 20 -30% drop in Aberdeen.

P.S.
Here are some websites for people to get to grips with the concept of Peak Oil and what it is going to happen to the UK/World shortly. People can't keep burying their head in the sand.

http://en.wikipedia.org/wiki/Peak_oil

http://www.hubbertpeak.com/

I've read several books and journals on the subject, it's very interesting that most people are just walking into it with blinkers on saying,
"the oil will see us out"
"new technology is increasing reserves all the time"
It really doesn't work like that. You are up against geological scientific facts.

UK and many many other countries are well into their decline curves. Most folk in Aberdeen are blind to this as pointed out by ad9898 and need to realise unless Aberdeen adapts (I have seen next to no evidence of this) it will be a very different place in 10 to 15 years time. I'm not going to predict prices then, but it aint going to be good news when the oil runs out.

Cheers

IveSeenTheLight

Peak Oil - True Oil is a finite resource

Since you have referenced M King Hubbert and Wikipedia, you will be aware that Mr Hubbert referred to Oil production graph for the US relating to a bell shape. Agreed his model is utilised outside the US now.
You will see in the graph below, that if peak oil is already here, then there is still a number of productive years ahead



Getting back to Aberdeen House Prices, here is a nice graph provided by data from the Registers of Scotland Executive Agency.
Seems the prices may be stagnating along at the moment

poppy10_2

Aberdeen house price up! :eek:

http://news.bbc.co.uk/2/hi/uk_news/scotland/7893543.stm

novazombie

Mitcha`s future signature

Aberdeenshire Average Property Price
(Source Nationwide)
Q1 2009...up to 20% down
Q4 2009... another huge % DROP
Q4 2010... Oh no I cant sell my house.
Q2 2011... I`ve spent so much on my house its not fair its worth only 50% now
Yes i have lost a lot of money in this HPC :mad:

Just found this old thread.

Whats mitchaa got to say these days?

Still think house prices are always going up in your area?

IveSeenTheLight

poppy10 wrote: »

Aberdeen house price up! :eek:

http://news.bbc.co.uk/2/hi/uk_news/scotland/7893543.stm

If you look at my graph taken from the RoSEA figures released up till Dec 2008, you will see its pretty much stagnated along for the last 18 months.
down a little, up a little.

Certainly not 2004 prices but thanks for showing an alternatice source

IveSeenTheLight

novazombie wrote: »

Mitcha`s future signature

Aberdeenshire Average Property Price
(Source Nationwide)
Q1 2009...up to 20% down
Q4 2009... another huge % DROP
Q4 2010... Oh no I cant sell my house.
Q2 2011... I`ve spent so much on my house its not fair its worth only 50% now
Yes i have lost a lot of money in this HPC :mad:

Just found this old thread.

Whats mitchaa got to say these days?

Still think house prices are always going up in your area?

LOL, try reading the last few posts and think a little.
Mitchaa agreed to buy in Q1 2007, therefore on average, Aberdeen is up 16% since then

donaldtramp

I'veseenthelight,

I agree there are many years of productive years left though you have presented a graph for the world, have a look at this one for the UK sector.


Still think there are many productive years ahead for the North Sea??
Source:
http://www.dieoff.org/page180.htm

I can source loads of images and reports that show the decline that is already happening.

Source:
http://www.theoildrum.com/node/4112

Crude oil, condensate and natural gas liquids (C+C+NGL) production. Source BP statistical review of world energy published 2007 with data up to 2006.

• Adding the small amount of production from Denmark to that for Norway and the UK provides this integrated picture for North Sea Oil production.
• Production peaked at 6.4 million bpd in 2000 and decline will likely continue as indicated.
• With falling North Sea oil production Europe will have to import more oil each year in competition with other regions (the USA and China) from a decreasing number of countries that actually have oil for export. This is one of the main reasons that the oil price is rising exponentially.

A note on reserves figures The remaining reserves figures reported above are for the discovered and developed resource. There may be some incremental growth in these numbers with new discoveries and deployment of Enhanced Oil Recovery (EOR) technologies. These are unlikely to make a huge difference, even if an additional 10 billion barrels are produced between 2030 and 2050. What matters are declining flow rates now that will likely persist for the foreseeable future.

Technology

Horizontal drilling, 3D seismic and dynamically positioned production ships have been deployed for over a decade. The incremental oil these technologies produce are embedded in the production data. Simply continuing to do what you are already doing will not change the decline trends.

The production and the money generated, creates the cash that allows Aberdeen to exist.
How on Earth is Aberdeen going to be supported when the decline rates are as rapid? Note the bit about incremental oil created by "new" techniques,

The incremental oil these technologies produce are embedded in the production data. Simply continuing to do what you are already doing will not change the decline trends.

If you take out a 25 year mortgage today, by 2034 the North Sea will be producing next to nothing and Aberdeen will be toast! There is nothing else here.

donaldtramp

A 16% buffer? That aint gonna be enough. I'm quite happy sitting in my rented place, thank you very much.

IveSeenTheLight

donaldtramp wrote: »

If you take out a 25 year mortgage today, by 2034 the North Sea will be producing next to nothing and Aberdeen will be toast! There is nothing else here.

A few final points

Take a look at this report for only one FPSO.
http://www.bp.com/liveassets/bp_internet/globalbp/STAGING/global_assets/downloads/U/uk_asset_schiehallion.pdf

If you read it they started in 1998 with an estimated 600 million barrels between the Schiehallion, Foinaven and Loyal fields, which they demonstrated well rates of up to 20,000 barrels per day

Simple mathematics would show 600,000,000 divided by 20,000 = 30,000 days or 82 years.
That's not considering downtime.

Secondly, you keep harping on about Aberdeen and how it relies on the North Sea. We keep telling you my friend that Aberdeen is the global hub and supports projects throughout the world.

We also offer that Aberdeen is diversifying into other energy sectors, which you continue to neglect.

Finally, the majority of offshore oil workers is a fraction of the residents of Aberdeen/shire. Many commute from thorughout the UK

Take a look at this report showing Aberdeen/shire as a popoulation of 440,000 and only 41,000 employed in oil and gas (less than 10%)

http://www.aberdeencityandshire.com/web/site/business/bus_Business.asp