MSE News: Halifax: House prices up again in August (+0.8%)

Harry_Powell

I don't know why anyone bothers debating with Graham anymore to be honest. It just goes around and around, total waste of time.

Sorry Graham, but it is.

mewbie_2

Harry_Powell wrote: »

I don't know why anyone bothers debating with Graham anymore to be honest. It just goes around and around, total waste of time.

Sorry Graham, but it is.

No, it isn't.

Graham_Devon

Harry_Powell wrote: »

I don't know why anyone bothers debating with Graham anymore to be honest. It just goes around and around, total waste of time.

Sorry Graham, but it is.

I spose it would be easier if we just ignored the reasons credit dried up and I agree that houses just fell in value, because credit just "stopped" for no apparent reason.

That way, we can just blame the bank problems for falling prices, and pretend houses are good value.

I agree. That's an easy way to look at the system, if you so wish to do so.

mewbie_2

Biggest bubble in history. Massive bubble. Ridiculous bubble. Nonsense bubble. Insane bubble.

I've run out of things to go with bubble, but you get the idea with that.

Cannon_Fodder

Double bubble...?

HAMISH_MCTAVISH

Graham_Devon wrote: »

As you could always say, what caused Northern Rock the problem with borrowing money?

The withdrawal of funds from the global wholesale markets, due to the American sub prime crisis.

A sub prime crisis.

Yes. In America.

What caused the sub prime crisis?

The misallocation of risk and malpractice of ratings agencies dealing with RMBS.

High house prices

No. And certainly not high UK house prices.

So although I see the gist of what you are saying, i.e. houses fell because of lack of credit, the lack of credit was caused because of high house prices and people simply unable to ever pay for those high house prices.

Not true at all of UK prices. In fact, UK arrears rates are still only 2.5%, and default less than 1%.

UK prices only fell because mortgage funding dried up, because banks could not get money to lend at any price as a result of the American meltdown.

You are trying to extrapolate that because the USA market imploded, the UK market would have as well. That is unknown, because we never got far enough along to find out.

mewbie_2

HAMISH_MCTAVISH wrote: »

You are trying to extrapolate that because the USA market imploded, the UK market would have as well. That is unknown, because we never got far enough along to find out.

Oh I don't know why I'm bothering.

Our market...

Actually I'm not going to bother.

HAMISH_MCTAVISH

mewbie wrote: »

Oh I don't know why I'm bothering.

Our market...

Actually I'm not going to bother.

:rolleyes:

For reasons other than the entirely artificial withdrawing of almost all mortgage funding.

It didn't implode because of high UK prices. That we know.

It may have at some point, but we'll never know.

mewbie_2

In 2003 prices were too high.

Along came BTL. People with equity in their overpriced houses could MEW it, borrow some more and invest for a future.

BTL pumped the market higher, and became a self fulfilling thing. The more people did it, the more the market went up.

2007 it was already starting to look shaky. Stories beginning to emerge of mis-selling, bankruptcies, Mum and Dad's owning multi million pund property empires. The trigger may have been the collapse of credit, but it was more of a coincidence. It was going to fail anyway. Had to.

2008 - shock horror - crash. Except the reason not so clear. Was it a bubble, was it the credit?

2009 - people still need to buy houses, and are accustomed to paying ridiculous amounts of money.

I think the crash has paused - after all .5% mortgage rates should really be building another boom but all we are doing is treading water. The few % up in a funny market this year may be cancelled by the winter months.

So .5% rates and 0% yoy.

I think we have just borrowed a bit of time.

Graham_Devon

So you thank that stuff about going round in circles Hamish, and then try to seperate the UK and US market, based on a banks which operate all over the world?!

Are you having a giraffe!??!

You'll note I never said high UK house prices, just high prices.

Blame the US....Totally ignore our banks are interconnected. Yep, brilliant.

Ignorance is bliss.