Nationwide November +0.4% MOM +1.6% YOY

julieq

Graham, read what I wrote. It's pretty clear. Most houses were bought prior to the crash. Some people have had a windfall, but affordability isn't a significant issue even with fairly significant rate rises. Which aren't going to happen anyway until the economy recovers.

As to supply and demand, think of ripples on the water as the tide comes in. The ripples can go up and down but the tide still raises the water level. There are local fluctuations in supply and demand for houses being sold - sellers see rises, put houses on market, supply increases slightly, prices moderate, less houses go onto market. But the underlying tide for supply and demand of homes is a significant upwards pressure on prices over time. The outlet for this currently is increased rent, which increases yield and pushes purchase prices up.

I suppose I shouldn't be surprised that you won't engage or think about an argument before taking a high handed and rather stupid line on it, because you've been doing that for literally years. But it's not going to help you take better decisions financially, which is not exactly a strong suit. Weren't you on a 6% fix or something? How did lower interest rates help you exactly?

Also in the spirit of Devonesque pedanticism, I didn't say that low interest rates were not a factor, which is what you explain I said. I said they were not a MAJOR factor. Which they weren't.

neverdespairgirl

julieq wrote: »

Well inflation will most likely be dropping into next year, so this is a moving target. I think there'll be modest upwards pressure on prices over the next 12 months or so, so maybe 3-4% YoY? Something like that. I would expect sentiment to improve generally into next spring, as I've said before.

3=4% over inflation, or 3-4% in nominal terms?

noodle_doodle

Before I confuse everyone about whether I'm a bull or a bear, I'm neither ;-)

Houses were well overpriced back in 2006/07, but apart from a sharp correction straight after the peak, what has happened is the equivalent of what a bus does when it's running ahead of schedule. Rather than slam the vehicle into reverse and head back down the road in a blaze of horns and screeching tyres, it's pulled over to a bus stop and is just sitting there waiting for the clock to catch up. So for the next 5 years, no significant rises, inflation chomping into the "real price" of housing, but no nominal falls. A £200K house today won't be out of whack 10% in either direction in 5 years time I reckon.

Graham_Devon

julieq wrote: »

I suppose I shouldn't be surprised that you won't engage or think about an argument before taking a high handed and rather stupid line on it, because you've been doing that for literally years. But it's not going to help you take better decisions financially, which is not exactly a strong suit. Weren't you on a 6% fix or something? How did lower interest rates help you exactly?

Oh...my Julie. :kisses3:

If you are going to try and have a pop and suggest I should engage or think, try at least to make your pop factual instead of reverting to your own world view again.

No, I'm not on a 6% fix.

How did lower interest rates help me? Saw my mortgage interest rate fall from 7.75% to 3.5%. Would have fallen further if there wasn't a collar on the SVR.

However, I did get a "good will" payout as the collar actually wasn't enforceable, but it seems by making a goodwill payment, they were able to enforce it going forward from that point.

julieq

neverdespairgirl wrote: »

3=4% over inflation, or 3-4% in nominal terms?

nominal. I have no idea what inflation is going to do.

angrypirate

julieq wrote: »

Graham, read what I wrote. It's pretty clear. Most houses were bought prior to the crash. Some people have had a windfall, but affordability isn't a significant issue even with fairly significant rate rises. Which aren't going to happen anyway until the economy recovers.

As to supply and demand, think of ripples on the water as the tide comes in. The ripples can go up and down but the tide still raises the water level. There are local fluctuations in supply and demand for houses being sold - sellers see rises, put houses on market, supply increases slightly, prices moderate, less houses go onto market. But the underlying tide for supply and demand of homes is a significant upwards pressure on prices over time. The outlet for this currently is increased rent, which increases yield and pushes purchase prices up. I explained this process of oscillation earlier in the year, but I don't think you understood it then.

I suppose I shouldn't be surprised that you won't engage or think about an argument before taking a high handed and rather stupid line on it, because you've been doing that for literally years. But it's not going to help you take better decisions financially, which is not exactly a strong suit. Weren't you on a 6% fix or something? How did lower interest rates help you exactly?

Also in the spirit of Devonesque pedanticism, I didn't say that low interest rates were not a factor, which is what you explain I said. I said they were not a MAJOR factor. Which they weren't.

Julieq, Id like to point out that I am looking at buying at the moment and have been house hunting now for a couple of months (yet to find the right property and now with Christmas coming up, very few new properties are coming on the market). There are a significant number of properties that i have viewed (probably just shy of 50%) that are not in a chain and the majority of these are in fact currently empty. I have put offers in on 2 of these but they have been rejected and they are still on the market now. I would put money on the fact that if rates werent higher, these properties would not be vacant and the vendors would have had to cut their prices by now to sell. As i say, this isnt just one property I have viewed - this is 2 that i have put offers on not to mention a further few that I have seen but decided werent the right house.

IveSeenTheLight

joguest wrote: »

Interesting divergence of opinion between the LR and Nationwide (-3.2% YoY compared with +1.6% YoY). I know which I'd bet on being right.

For Hamish:



(Haliwide NSA, LR SA and shifted back a couple of months)

Not really, when you look at your graph, the LR has reflected the movement that the Nationwide showed a couple of months ago.

julieq

So had you stayed on 7.75% Graham, would you still be in your half of the house?

I suspect you would be. You've just had a little extra money. It hasn't affected the housing market at all, you've just had a windfall.

So it is with most people. Low interest rates for those with mortgages are a windfall, not a lifesaver, in the vast majority of cases.

Of course if you want to believe everyone is going to be crippled by paying the same rates on their mortgage now as they were 3 years ago, then be my guest. But there's no evidence supporting that view. On the other hand if they (or you) were made unemployed there's very little difference whether they're paying 3.5% or 7.5%. It's employment rather than rates which is the major factor.

7.75% is a fairly chunky rate though - how on earth did you end up with that at a time when prevailing rates were around 4.5% or so?

Graham_Devon

julieq wrote: »

So had you stayed on 7.75% Graham, would you still be in your half of the house?

I suspect you would be. You've just had a little extra money. It hasn't affected the housing market at all, you've just had a windfall.

So it is with most people. Low interest rates for those with mortgages are a windfall, not a lifesaver, in the vast majority of cases.

Of course if you want to believe everyone is going to be crippled by paying the same rates on their mortgage now as they were 3 years ago, then be my guest. But there's no evidence supporting that view. On the other hand if they (or you) were made unemployed there's very little difference whether they're paying 3.5% or 7.5%. It's employment rather than rates which is the major factor.

7.75% is a fairly chunky rate though - how on earth did you end up with that at a time when prevailing rates were around 4.5% or so?

You are hard work Julie.

If you haven't noticed, wages are pretty much static, though you will argue they are rising, so yes, some people are getting small wage rises, but nowhere near matching the costs of living increases.

Do you REALLY believe yourself when you suggest that it would make no difference if mortgage rates were back to where they were in 2007/8?

If you believe that, I can't change your mind, but don't expect me to follow your personal thoughts. The cost of living, inflation etc seems to have passed you by. These costs are not small. I listened to a piece on the news the other day which had calculated that since 2006 (5 year research), the typical 2 point 4 children family is currently £180 worse off per month on living costs. Many however feel better off, as their mortgage could be typically £450 less per month thanks to interest rates.

As for your last paragraph regarding my 7.75% rate, I suggest you do some research on base rates. You haven't got a clue...have you?

julieq

angrypirate wrote: »

Julieq, Id like to point out that I am looking at buying at the moment and have been house hunting now for a couple of months (yet to find the right property and now with Christmas coming up, very few new properties are coming on the market). There are a significant number of properties that i have viewed (probably just shy of 50%) that are not in a chain and the majority of these are in fact currently empty. I have put offers in on 2 of these but they have been rejected and they are still on the market now. I would put money on the fact that if rates werent higher, these properties would not be vacant and the vendors would have had to cut their prices by now to sell. As i say, this isnt just one property I have viewed - this is 2 that i have put offers on not to mention a further few that I have seen but decided werent the right house.

I don't follow the logic. Why would the interest rate a buyer pays affect the willingness of a seller to sell? It's more likely that the sellers are waiting for a better offer. Unless you know about the seller and their financial status you can't draw a causal link.

And you can only infer anything at all about the 2 houses you offered on.

So case not proved really. I don't understand what you're getting at.