Land Registry up 0.4%

chucknorris

Chris2685 wrote: »

lol, but seriously it is something I am interested in. The numbers really don't add up to me. I don't know the right or wrong answer for any of it, just trying to get more info over time. All I can tell is that it is totally unpredictable what will happen in the real world, compared to what should happen with numbers.

Well tbh I expected prices to drop further but it could just be that people who saw the crash coming and held back from buying in 2007/8, STR's and investors think that now is agood time to buy. We have been sniffing around a couple of properties but they went under offer.

Strings

Chris2685 wrote: »

Then there is the average household income, which does not support the average house price in any way. I thought banks were going back to somewhere near 3.5x income to calculate what mortgage they will lend, in that case the average household should only be able to get a mortgage of 105000.


I know these are all very simplified figures and calculations, but it should surely be somewhere a little nearer to that, or am I just being TOO simple? I realise there are extremes in all cases, but an average is what it is. An average.

The problem is you dont know the types of people that are buying, they could all be on high incomes, in which case they can afford well over the national average.

More and more people are using joint incomes, so that immediately raises what they can lend on. I just did a search for mortgage's assuming each joint holder was on 25k each, there were multiple products that would lend up to 225k (assuming 10% deposit)

Strings

chucknorris wrote: »

Well tbh I expected prices to drop further but it could just be that people who saw the crash coming and held back from buying in 2007/8, STR's and investors think that now is agood time to buy. We have been sniffing around a couple of properties but they went under offer.

Mortgage rates are low-ish, and rental yeilds are pretty good in the scheme of things. If you've got the deposit, the yeilds will work well for you. It has for us

IveSeenTheLight

Generali wrote: »

LR has a pretty big lag (3-4 months) over the Haliwide indices. Also while I think it is the most accurate measure of house prices it has limitations, for example new build, repossessions and probate sales aren't included.

Totally agree that LR is not totally inclusive, but we are agreeing that it is more substantial than the NW or halifax.

With reference to the lag, the latest release is for July.
That's not a 3-4 month lag, so while it historically may have taken this amount of time, it seems the lag has decreased (possibly due to lower transaction numbers than previously)

chucky

IveSeenTheLight wrote: »

Totally agree that LR is not totally inclusive, but we are agreeing that it is more substantial than the NW or halifax.

With reference to the lag, the latest release is for July.
That's not a 3-4 month lag, so while it historically may have taken this amount of time, it seems the lag has decreased (possibly due to lower transaction numbers than previously)

there all pretty accurate and point in the same direction

Current YoY - House Price Indexes
Rightmove............. 4.30%
Nationwide.............6.60%
Halifax ..................4.80%
CLG MA................ 11.00%
FT-HPI MA............. 7.70%
Land Registry.......... 6.70%

the real house price rises, inflation and RPI argument falls down when you look at YoY numbers.

IveSeenTheLight

Dirk_Rambo wrote: »

oh no. the governments making stuff up again. its just as well no one beleives them any more

lol, your developing a mewbie-esque style of humour

HAMISH_MCTAVISH

Chris2685 wrote: »

Average household income = ~£30,000 (http://www.statistics.gov.uk/cci/nugget.asp?id=334)
Average house price = £166,798 (http://www1.landregistry.gov.uk/houseprices/)

This means that on average people need a deposit of ~£25,000 to put down a 15% deposit.

That doesn't include other costs, so realistically a household would need at least £30,000 in savings to be able to even consider buying an average house.


I know these figures are for average houses, and most FTB's would buy a below average house, but even then you are still going to be talk around £20,000-£25,000 in cash required before considering buying.


Then there is the average household income, which does not support the average house price in any way. I thought banks were going back to somewhere near 3.5x income to calculate what mortgage they will lend, in that case the average household should only be able to get a mortgage of 105000.


I know these are all very simplified figures and calculations, but it should surely be somewhere a little nearer to that, or am I just being TOO simple? I realise there are extremes in all cases, but an average is what it is. An average.

Average household income includes ALL households. Pensioners, unemployed, people in council houses, students, etc.

And as we know, the lowest earning 30% of households have never been able to afford to buy a house, which is why owner occupation peaked at 70%.

So the average income of actual or likely housebuyers is actually the average income of the top earning 70% of households.

If I had to guess, that figure would be closer to 45K than 30K, in which case the current average price of around 160K to 170K stacks up nicely.

This is confirmed by the CML mortgage stats, which show the average salary multiple for actual first time buyers never crossed 3.5 times income even at peak, and for 2nd time buyers never crossed 3 times income even at peak.

IveSeenTheLight

chucky wrote: »

there all pretty accurate and point in the same direction

Current YoY - House Price Indexes
Rightmove............. 4.30%
Nationwide.............6.60%
Halifax ..................4.80%
CLG MA................ 11.00%
FT-HPI MA............. 7.70%
Land Registry.......... 6.70%

the real house price rises, inflation and RPI argument falls down when you look at YoY numbers.

Fair point, but when looking at the YOY HPI, you do still have to understand what the trend was both now and a year ago.

I would put money on the YOY percentages lowering in the next few months.
that does not mean prices are falling, but that they are stagnating now while they were rising last year.

chucky

IveSeenTheLight wrote: »

Fair point, but when looking at the YOY HPI, you do still have to understand what the trend was both now and a year ago.

I would put money on the YOY percentages lowering in the next few months.
that does not mean prices are falling, but that they are stagnating now while they were rising last year.

yes - the RPI and CPI numbers are YoY as are the above YoY house prices..

it's like for like.

trend analysis of both would be interesting - i would say that they correlate relatively quite closely. i'm saying that without checking btw

HAMISH_MCTAVISH

Still, + 0.4% is the strongest LR gain since January and shows the claimed falls in July reported elsewhere were false.

Perhaps Dirk/Carol can stop bumping them now.