A crash is a crash is a crash.

Sibley

Yawn!

Yet another thread where the bears have been put to the sword.

I expect they will give up on all this soon and go to live with Swampy under Manchester airport.

Jowo_2

geneer wrote: »

..So whats the story?
.

I always like Private Eye for its take on the issues. On property prices, their article said 'Today experts are saying that property prices will fall/remain stable/decline'.

The story is that no-one can call the bottom of the property market. Some of the worst price falls were restricted to certain areas and certain types of property. Some of the areas that had stagnant or declining markets in 2007 have revived substantially.

Even when its at its lowest for some time or there's been a small surge upwards, those willing the market to crash (i.e. buyers) are convinced it will be a dead cat bounce and the second fall will be catastrophic.

For example, my friend sold their flat in Brighton last year for 20% under the original asking price and the estate agent said that he was continually showing property to buyers who had sold their previous property two or three years before and who were still too nervous to reenter the market in case there were further falls in price. The fact that they've spent tens of thousands of pounds in private rental accommodation is never factored into their bargain hunting.

Those willing the market to recover (i.e. sellers) are convinced that the worst is over, that prices are on the upward march.

I personally think that future interest rate rises will have significant adverse reactions on house price inflation, that people are amnesiac about how they've been protected by the Bank of England for years and the only way is up in terms of their mortgage expenses.

I'm mortgage free, therefore neutral on the matter!

jamesd

Sibley wrote: »

Houses are more expensive in SE London and Kent than the 2007 benchmark.

Your HPC gang never got your crash and will probably never own a house. It's not nice to say but true. The sooner you accept that fact and get on with your lives the better.

You're really going to try arguing that what the stock markets saw in 2008 wasn't a crash just because prices now in some markets are higher than they were before a drop?

There was a crash in the UK housing market. The severity varied and in some parts of the market in some parts of the country prices have fully recovered or even increased, while in others they are still falling.

So far most of the UK market hasn't seen drops anything like those in the US, though buyers of newbuild flats in 2007 and 2008 might have reason to disagree.

The place I'm living now has been offered to me at less than the price paid for it in 2005. I didn't bite because I bought a better deal at an even lower price.

julieq wrote: »

there is no basis for expecting further falls, and given the contraction in prices came off the back of a complete collapse in confidence in banking, followed by mortgage rationing, you've had your chips now basically as regards a fall.

Doubt you're right about that except in markets driven by foreign money, bonuses and uncommonly wealthy buyers. We still have to work through:

1. The reluctance to sell that causes several years of inflation-related real additional drops even though nominal value doesn't change.
2. Increased Bank Rate and what that does to the number of people who have trouble with their mortgages, who are currently being saved by low rates.
3. What an improved market does to mortgage lender's willingness to show forbearance and not repossess.
4. Government spending and job cuts.
5. The rest of the announced tax increases and any new ones.

There's still going to be a lot of variation between markets, though. London high value in particular is driven by foreign money and bonuses and the exchange rate means prices there are still below the peak for foreign buyers. I don't think any of those things is going to cause a sudden, dramatic drop. I assume it'll be better managed than that by the government and lenders trying to avoid larger than required losses on the properties they repossess.

geneer

julieq wrote: »

As far as I'm aware, no "bull" has ever said there hasn't been a correction. To claim otherwise is an utter misrepresentation. It's taking something that wasn't said and proving it false, which proves nothing.

:rotfl::rotfl::rotfl:So you're claiming that not one bull has ever made the statement that theres been no crash.
Boy. Bang goes your credibility.

julieq wrote: »

What we have said though is that there is no basis for expecting further falls

Which, regardless of the reality of that statement, is not actually being discussed here.

julieq wrote: »

Peak in 1990s, let's say £70K. Trough, let's say £60K. Ratio of peak to trough: 1.167.

Peak in 2000s, let's say £200K. Currrent position, let's say £170. Ratio of peak 1.176.

I.e. the correction is roughly the same.

So 90's=Crash and noughties=crash.
Isn't that what I said.

julieq wrote: »

If you include inflation, the current correction is far smaller, as others have noted. The current fall was over a shorter period, allowing inflation less time to be a factor, and the rate was far lower anyway.

Actually, inflation doesn't put you into negative equity. Ho hum.


Now, who's going to be bet that had I used the inflation adjusted chart, someone would have whined about the fact that inflation isn't really reflective of house price falls as it includes real falls.

Funny how the post crash wriggly bull realignment has saw them claiming "real house price falls" as a win.

nembot

Typically a house price crash would be defined as 1% or more drops, for a number of consecutive months (six or more).

So definitely a crash in 2008 and not that far away over the last 6 months, certainly in some areas.

IveSeenTheLight

nembot wrote: »

Typically a house price crash would be defined as 1% or more drops, for a number of consecutive months (six or more).

So definitely a crash in 2008 and not that far away over the last 6 months, certainly in some areas.

Is that your definition?
Is it the same criteria for a recession i.e. if you have 5 months greater than 1% drops but one at 0.9% followed by another 5 months greater than 1% before say a 0.5% drop then it's still not a crash?

I wouldn't agree with your definition.

In 2008, clearly prices "corrected" to the 30 year norm as can be seen on the Nationwide graph.
Do you call a correction a crash? I wouldn't.

People refer to the 2000's as a bubble that inflated way above the mean. Wouldn;t it be natural to consider a crash as the inverse of the HPI bubble i,e, not just a revert to the mean.

IveSeenTheLight

nembot wrote: »

Typically a house price crash would be defined as 1% or more drops, for a number of consecutive months (six or more).

So definitely a crash in 2008 and not that far away over the last 6 months, certainly in some areas.

LOL, just checked LR and they didn;t record 6 consecutive months of 1% or more drops.
closest was from August 2008 where they had 5 consecutive months greater than 1% drops

nembot

The real tragedy ISTL, is you believe your own bullsh1t.

I'm off the pub, laters.

geneer

IveSeenTheLight wrote: »

Is that your definition?
Is it the same criteria for a recession i.e. if you have 5 months greater than 1% drops but one at 0.9% followed by another 5 months greater than 1% before say a 0.5% drop then it's still not a crash?

Yawn. I wonder if lite will furnish us with his assesment of what constitutes a crash.

IveSeenTheLight wrote: »

In 2008, clearly prices "corrected" to the 30 year norm as can be seen on the Nationwide graph.
Do you call a correction a crash? I wouldn't.

:rotfl::rotfl::rotfl::rotfl::rotfl:Exquisite.

IveSeenTheLight wrote: »

People refer to the 2000's as a bubble that inflated way above the mean. Wouldn;t it be natural to consider a crash as the inverse of the HPI bubble i,e, not just a revert to the mean.

Nope.

Which is why everyone but a few malcontents who didn't like being proven wrong called it a crash in the 90's and called it a crash in 2008.

geneer

IveSeenTheLight wrote: »

LOL, just checked LR and they didn;t record 6 consecutive months of 1% or more drops.
closest was from August 2008 where they had 5 consecutive months greater than 1% drops

The only interesting thing here is that fact that you were driven to check the LR.

But thats the bulls for you.
Trying to win teeny tiny battles now that they've lost the war.

"but you said half million pound massive townhouses were skewing the averages, when you should have said £400,000+ massive four bedroom houses".:rotfl: