When do we think HPI will kick off again.

ad9898_3

When do we think that HPI will kick off again ? The government and the media seem to be trying everything in their power to engineer a recovery in the market at the moment, will it work ?, or is it a futile attempt by a government running out of ideas/desperate for re-election ?

Brown seems to think we could be on the way to recovery by April, is it because he is going to try to get the other governments to use QE at the G20 ? I just can't see QE working, as the money would have to flow down into wage inflation to make a difference, at this time it seems impossible that with unemployment rising, wages are going to rise as well.

It's all well and good if the banks are recapitalised by QE so they can 'start lending again', but if no ones got the wage inflation to borrow the 'QE money', what good is it going to do ?

Maybe I'm being to simplistic.

chucky

on the average index around 2011/2012, maybe even later.
but in saying that some areas will have to increase as rent is cheaper than buying.

small increases in HPI in some areas will happen this year - however not like the historical HPI increases.

WestonDave

There is some anecdotal evidence locally of more activity, and also I've heard from two different reliable sources that at least one bank has money to lend but no-one they feel they can lend it to applying to borrow. I suspect there is a degree of demand from people who had previously found their saving rate outstripped by HPI who are diving in now to get a family home (many people want to do this to be able to control their lives, avoid 6 monthly risk of moves etc not just because they want to get on the dreaded ladder). Whether there is enough of this type of demand to rebuild a degree of confidence which brings others back out to play or whether it is just a temporary stall in the fall who knows.

Locally the price of a 3 bed house hit a level where monthly mortgage payments were less than the local HLA (housing benefit) rates for that size house. That would not appear to be sustainable so one will have to move to get things back in equilibrium otherwise houses will be back into attractive BTL territory. (That particular house would have yielded nearly 6% rented at HLA levels ignoring possible capital depreciation - with interest rates at near enough zero for deposits, those with cash to invest may well be tempted)

handful

ad9898 wrote: »

Brown seems to think we could be on the way to recovery by April,.

I think he has a one in twelve chance of being right with the month but with the year he has no chance.

Thrugelmir

Property seems to have become an obession more recently. Much in the same way that the Dotcom boom overtook the media.

I think that the Government are attempting to engineer a soft landing in the residential housing market not stimulate a recovery. With a large majority of the voting population being property owners this would be a sure way of losing credibility and votes.


It doesn't require a crystal ball to see that the for the foreseeable future that there has been a fundamental change in the property market. The return to a more limited availability of mortgage funding is permanent and is with us right now.

Longer term high unemployment, repayment of corporate and personal debt, increased taxes to fund the governments borrowing, higher interest rates and inflationary pay rises will all constrain the market to rise.

Property for the majority will return to what it should be a home. Individuals with cash will be able to purchase property to let. The ability to release equity in a rising market to leverage up to buy property after property has gone. In a way its just like all other pyramid schemes. In the end the whole lot comes crashing down.

lostinrates

You know, I saw lots of sold signs this morning, and under offer ones. ''Hmmm'' I thought.

Last night I was chatting in the telephone to a friend who works in ...well, a nationwide employer/service provider. They were saying that budget was sorted for this year, sort of sorted for next year and in bloody trouble the year after that.

Dan:_4

Prices will bottom this summer and will stagnate for a number of years. Slow HPI and back to 2007 levels in 2015/16.

I doubt we will ever see the silly 2000s HPI again. (well not for a good 30 years)

besonders1

Dan: wrote: »

Prices will bottom this summer and will stagnate for a number of years. Slow HPI and back to 2007 levels in 2015/16.

I doubt we will ever see the silly 2000s HPI again. (well not for a good 30 years)

well I should certainly hope so, the obsession with housing reminded me of the "get rich quick" schemes. Maybe for some investors they did make a profit as they sold at the right time but sadly for many homeowners who bought in 2007 will end up with negative equity. Its strange how a lot of people didn't know that we had already reached the top if the market in 2007/8 and there are some people who have their houses on the market at these prices and wondering why its not selling. Goes to show that people will believe anything that EAs or property shows tell them, When greed comes into the equation, sense is lost!