Just taking stock

MRSTITTLEMOUSE

I don't claim to know anything about house prices.I don't intend to sell,however I've noticed that in the past month there has been a lot of movement in houses and flats being sold in my area.So someone must be lending out there.
One thing I did notice is it's all the much older properties that are selling,some on the coast have been selling in a day.

the_ash_and_the_oak

Although it seems not many houses are actually up for sale (unlike last time around) it seems there has been a significant rise in anecdotal sales - although this doesn't seem to have really filtered through into mortgage approvals (could be cash buyers perhaps?) or transaction levels (presumably a lag?)

a_rather_tall_man

Some good points in several posts but it does seem that its all too easy to get caught up in just analysing data when for me one of the most important things needed for recovery is something that is not easily measured....confidence. People's belief that there future earnings are secure so they can afford to spend. For now it has all but disappeared.

I speak as a potential FTB and I know a couple of others in the same position and whilst everyone quotes the price drops already happened within the market, low interest rates etc these are irrelevant for as long as employment is under threat. Who on earth would take out any large financial commitment when colleagues, friends and relatives working in many different sectors are still finding themselves being made redundant? Thats what makes economics an unpredictable beast, you can't easily quantify human nature and the decisions we will all make. Forget QE and its effects for now, until the magic C word starts to flow we arent going anywhere forward.

Graham_Devon

a_rather_tall_man wrote: »

Some good points in several posts but it does seem that its all too easy to get caught up in just analysing data when for me one of the most important things needed for recovery is something that is not easily measured....confidence. People's belief that there future earnings are secure so they can afford to spend. For now it has all but disappeared.

I speak as a potential FTB and I know a couple of others in the same position and whilst everyone quotes the price drops already happened within the market, low interest rates etc these are irrelevant for as long as employment is under threat. Who on earth would take out any large financial commitment when colleagues, friends and relatives working in many different sectors are still finding themselves being made redundant? Thats what makes economics an unpredictable beast, you can't easily quantify human nature and the decisions we will all make. Forget QE and its effects for now, until the magic C word starts to flow we arent going anywhere forward.

I agree with you.

However, a part of me does think there will be many out there who will jump in regardless. The UK has shown this to be the case with loans and bankruptices.

There are some trying to make the system more like the US, where you jump in, and if you cant afford it, hand the keys back to the bank and leave the problem to them. I hope this never comes through in the UK, but with bankruptcy being made easier and less meaningful all the time, I think this could be something at least this government will look at. The buyer then just walks away and starts again.

This is why predictions are so hard to make, and why I don't like the whole "your prediction was wrong, haha" stuff. You can think you know whats going on, but then out of the blue, comes a second bailout, comes QE. We haven't finished with the stupid measures yet, not from this government, and I personally feel handing the keys back and walking away, would be something this government would quite like, as they will call it "help for the hard working family".

It's this government and it's sudden u-turns and changes, thats made this thread. What usually would happen in these sorts of times, may or may not happen, which is why I'm begining to think they applied enough plasters for now, not thinking about what happens when the plasters come off (they aint gonna be the ones who deal with that problem!)

The housing market has 'stabilised' at a new lower level, one I suspect is incapable of even supporting house prices where they are at present. For the house market to function normally we need to see about 70,000 mortgages going through each month.

It'll be interesting to see what will happen when base rates rise - that will have a very nasty impact (presumably) on Government finances and also (again presumably) on some individuals. My suspicion is that any nascent recovery will be choked off as inflation rises.

Good point Generali. With more houses on the market than those with available funds, houses are going to have to compete, in a variety of ways. I guess those to suffer the most would be the higher end detached 3-4 bed homes.

On a seperate note, I was kind of expecting some reasoning for how the economy can go the other way and start to rise or plateau out alltogether from the bulls, as individual stories keep getting posted up, but with no explanation of how, so would be interesting to see some stuff from you guys?

the_ash_and_the_oak

Actually (partially) disagree with this. Think sentiment is pretty high imo (maybe confidence is a slightly different thing and a bit lower). Think populations sentiment re:housing v robust and not taken much of a knock. Been a general feeling of "well some city centre flats have come down sure but..." kinda feeling UK public believes houses are cheap now and that we are close to the bottom.

Not really feeling sentiment is the problem - feeling its not really that people don't want to do this, its that they can't raise the finance

Wouldn't surprise if neither of these things change for a good while

Graham_Devon

the_ash_and_the_oak wrote: »

Actually (partially) disagree with this. Think sentiment is pretty high imo (maybe confidence is a slightly different thing and a bit lower). Think populations sentiment re:housing v robust and not taken much of a knock. Been a general feeling of "well some city centre flats have come down sure but..." kinda feeling UK public believes houses are cheap now and that we are close to the bottom.

Not really feeling sentiment is the problem - feeling its not really that people don't want to do this, its that they can't raise the finance

Wouldn't surprise if neither of these things change for a good while

Personally I feel that most confidence is simply manufactured, from places like the BBC. Most families don't go home and discuss this. They see "green shoots" on the BBC news at night and take it as if thats the case without question.

Confidence is easy to manufacture in the right people.

It's unfortunate that the right people would be, in my mind, about 80% of the population who never question themselves or the media. Too busy reading about hwo posh spice lost nother ounce of weight.

the_ash_and_the_oak

Not sure it really matters if its manufactured or not imo.

Graham_Devon

the_ash_and_the_oak wrote: »

Not sure it really matters if its manufactured or not imo.

I was manufactured confidence. I kept getting told in 2005-6 that house prices only go up, if I don't buy soon I will be priced out forever.

I didn't know much back then, I just went on wat the news, my family and my advisor told me.

I then looked into it more before I actually bought, but nearly made a massive mistake on a 2 bed newbuild flat, before I started actually looking for info.

The flat, had every incentive under the roof. Cashback, white goods, furnished to my style etc. They knew something!!

lostinrates

seems mixed to me. Posters here with a (presumably) intelligent informed basis, seem confident, whereas other people I've spoken to from intelligent and informed positions seem very pessimistic, and I wwould suggest that mixed feeling is what we have, not a dominance either way ATM.

the_ash_and_the_oak

agree w that - but sentiment is something nationwide surely - not a subsection of informed/intelligent (defined however you wish) people?