How sentiment can change in one year. Property prices expected to rise.

IveSeenTheLight

Graham_Devon wrote: »

There always were a number of 90% LTV's available. This looks past how much they actually cost. And they are expensive. The 90% is just one part. The interest, arrangement fee's etc are problems in themselves. So it's not quite as clear cut as you suggest.
Totally agree, and that is why the higher deposit was desired in order to get the better credit deal. If you do look though you will see that the percentage is being eased up the LTV scales


Also because people could not get credit. Because they were in NE, because their house was falling in value. Because chains were being broken by people unable to complete. It wasn't simply sentiment which is now just changing. We still have many of the problems above. It isn't going to change to normality any time soon. Yes, you are correct, it IS changing. But that looks past the fact that it aint going to be "normal" for ages.
What is normal? Do you believe 2007 levels were normal? Maybe it is a time to look past what was historically normal and decide if a new normal is required due to the different affecting factors.


Argh! Up 1 million is nearly double the original figure! Whether we have an increased population, or it was lower than forecast, it's nearly double. Thats huge, regardless of how you paint it.
I'm not disagreeing it is up What I was trying to portray was that in fact employment is also up on previous years due to higher migration and increased population.
It's not clear how many of the unemployed were home owners, how many were the sole earners in the families.
I've also not raised other issues as the support that is available for households that are non earners.

People relied on remortgaging to get a better deal. That remortgaging option is a lot harder now. We have no idea when they will rise, or how they will rise. Judging by how they fell, I would say it would be extremely dangerous to suggest they will rise gradually. One turn in the markets somewhere, and thats it, things change rapidly.

I'm not sure if it is harder. Maybe those in negative wquity I suppose. i think the reason re-mortgageing is down is due to the fact that the SVR is currently a better rate than re-mortgaging and therefore people are taking advantage of paying less

People will not be in a better position if rates rise back up. They will be in a worse position having got used to the amount currently going out. That is life, that's how people work. You get used to an outgoing and you decide you can now afford that car loan with the mortgage savings. Let's not pretend everyone is savvy, we got into this whole mess through people NOT being savvy.
By being in a better position I meant from at the time of the peak. Of course they will be in a better position as they will have paid off more capital in that time (2 years have passed already)



Well yes, but you are just saying it will end. Not taking any real notice of what was actually said and what will happen when it ends. We all know it will end.
What will happen when it ends? Quantify it? what will be the basis of the economy when it ends?


Agreed. But again, kind of looks past the problem with paying for this. It's just again saying we will have to pay for it, which again, we know.
I asked "how much worse would the country have been without it?" Can you answer that? How much per person is the stimulus costing?

see above please.

Graham_Devon

IveSeenTheLight wrote: »

see above please.

What is normal? Do you believe 2007 levels were normal? Maybe it is a time to look past what was historically normal and decide if a new normal is required due to the different affecting factors.

How can you have a new normal!!?

By being in a better position I meant from at the time of the peak. Of course they will be in a better position as they will have paid off more capital in that time (2 years have passed already)

Not the case for interest only, and in 2 years on a repayment, not that much will have been paid off, not to make it significant.

As for the rest, it's questions in response to questions

the_ash_and_the_oak

Really2 wrote: »

TBF if you looked on the house buying and rent board last year it was very different to this year. Also a lot less people using it last year.

Demand was down but imo desire much less so. In general I think the public's desire to buy wasn't really affected that much last year - although their ability to do so certainly was

IveSeenTheLight

Graham_Devon wrote: »

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IveSeenTheLight wrote:

What is normal? Do you believe 2007 levels were normal? Maybe it is a time to look past what was historically normal and decide if a new normal is required due to the different affecting factors.

How can you have a new normal!!?

The 'old' normal was a result of the criteria set at that time.
if the criteria changes then that can affect what is 'normal'

Were discussing transaction levels here.
What was normal transaction levels in the 00's?
Was it the same in the 90's?
How about the 50's?
Or the 1900's?

I doubt we could get actual figures going back that far, but I'm sure knowing you've seen the massive increase in private ownership in the last 50 years you can see that the level of transactions have vastly changed over the years.
This is because the criteria affecting transaction levels changes and as such what was deemed as normal transaction levels changed as a result

Graham_Devon wrote: »

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Not the case for interest only, and in 2 years on a repayment, not that much will have been paid off, not to make it significant.

Accepted, interest only mortgages will not have reduced the capital, but are interest only mortgage what people have in general?
You could also say those that were on fixed mortgages will not have benefited.
I could argue that those on interest only trackers will still have benefited by having to outlay less in mortgage interest terms and therefore could have savings to put into the mortgage when they try to re-mortgage

Your opinion on the amount saved over 2 years being insignificant is incorrect in my opinion.
On one of my tracker mortgages, I am paying over £400 less interest every month.
Over a 2 year period, this is £10k, not an insignificant amount in my opinion.
another reason why when rates rise, many people like myself will be in a better position than when they were before the rates dropped.

Graham_Devon wrote: »

As for the rest, it's questions in response to questions

Your not able / willing to provide answers to the questions? :shocking:
Sometimes in order to provide an answer to a question you need to have a deeper understanding and therefore ask questions in order to achieve that understanding

Really2

Graham_Devon wrote: »

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How can you have a new normal!!?

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If something becomes normal it is the new normal.

If the speed limit on a road is lowered to 20MPH from 30MPH (or sleeping policemen introduced) what do you think that would do to the normal speed? Would it differ from the old normal speed?

Normal is not an immovable place that would be a threshold.
The market is to all intents and purposes normal and always has been just that restrictions have changed the market from what used to be normal 2 years ago.

Graham_Devon

Really2 wrote: »

If something becomes normal it is the new normal.

If the speed limit on a road is lowered to 20MPH from 30MPH (or sleeping policemen introduced) what do you think that would do to the normal speed? Would it differ from the old normal speed?

Normal is not an immovable place that would be a threshold.
The market is to all intents and purposes normal and always has been just that restrictions have changed the market from what used to be normal 2 years ago.

The speed limit is an enforced normal.

Theres different ways to look at different normalities. And with that, comes different scenarios with differing influences.

Really2

Graham_Devon wrote: »

The speed limit is an enforced normal.

So people don't speed?

Anyway what about credit availability or deposit size they are enforced normals?
What about property stock availability.

You can not argue that the market is not normal, people are buying and selling still.
It is normal for the current restrictions and climate.

My example was how a limiting factor can change / lower a previous normal it clearly states "or sleeping policemen" Graham so your saying it is enforced limit is a cop out. As either an enforced or not limit still lowers the norm.

If you don't agree could you explain your normal so we understand.

IveSeenTheLight

Graham_Devon wrote: »

The speed limit is an enforced normal.

Theres different ways to look at different normalities. And with that, comes different scenarios with differing influences.

Can you accept that a different set of criteria affects what is normal?

Regardless of whether that criteria is sleeping policemen, availability of credit, tightening of acceptance criteria i.e. higher deposits etc etc etc that these factors can set that a new normal is in place.

Really2

Quizzical_Squirrel wrote: »

If people are optimistic about price rises over the next year then surely that will be counterproductive?

If more people are confident enough to put their houses on the market in the spring it will impact the level of supply and even if demand rises correspondingly from fear of missing out - the funding still isn't there.

If you read the quote only 5% think it is a good time to sell so they think supply will remain contracted until late 2010.

But the current imbalance between supply and demand looks set to continue, with 68% of people thinking now is a good time to buy a home, but only 5% thinking it is a good time to sell one.
The current shortage of homes on the market has offered some support to house prices, but it has led to around five potential buyers chasing every property that is up for sale.
However, there are signs that the imbalance could ease during 2010, with 54% of people saying they think it will be a better time to sell a property a year from now, suggesting more sellers may come to the market towards the end of next year.

the_ash_and_the_oak

Its kind of a weird one because it kinda depends what is meant by "a good time to sell one". Is it good/bad because you can get a good price? or is it good/bad because you can find a buyer?