Boom - bust - boom When didn't it ?

dougk_2

No - I don't believe in seasonally adjusted figures.....

Take them away totally I say and present facts not fiddles with figures!

It would be clearer to say that this month prices rose / fell. By all means say that January sales represent x% of the sales so far this year or on average over the past 20 years x% of house sales occur in January.

It is a similar - I read an article which said "BTL sales are falling" a few months back , but it was leading it was "Growth in BTL sales was falling". There is a difference!

deemy2004

I'm in the boat too, of an ever increasing cash mountain, pending the anticipated drop in house prices of maybe 12% over 3 years , where interest recieved is approx 5% per annum, so would make me some 29% better off ! As against buy and hold. Off course if you factor mortgage payments in them I am far better off..

Afterall for me to lose, House prices would need to increase by more than about 17% over the next 3 years.

And each time interest rates nudge higher so do my returns and put even more pressure on house prices to fall..

EdInvestor

Pal wrote:

If I do that, then I lose a chunk of the equity I have in the bank. This is money that I never earned in the first place - I received it for free.

Aha Pal, I see you are one of the small minority of people who realise their equity.;)

Good luck: it's a risky strategy IMHO in the current environment because of the chance that the big rise is a one-off response to the switch to a low interest rate, low inflation environment (the reverse of what's happened to annuity rates, if you see what I mean) and thus not likely to follow the usual boom/ bust pattern

Pal

I don't see it as "risky" because of the fortunate position I am in. It doesn't cost me any extra in terms of "lost" money (rent or interest) to rent than to buy.

If house prices rise by 20% then I have lost out on a chunk of equity that I might have had if I had not sold when I did, but hey, I missed out on last week's lottery as well by not guessing the right numbers! The world is full of missed investment opportunities! Lets face it, 20% rise is now pretty unlikely over the next couple of years.

Asking prices around here (S London) for the houses I would want appear to have already fallen by about £10-£20k, so I have probably already made a paper profit, even without further house price falls.

Time will tell.

Pal

dougk wrote:

No - I don't believe in seasonally adjusted figures.....

Take them away totally I say and present facts not fiddles with figures!

It would be clearer to say that this month prices rose / fell. By all means say that January sales represent x% of the sales so far this year or on average over the past 20 years x% of house sales occur in January.

It is a similar - I read an article which said "BTL sales are falling" a few months back , but it was leading it was "Growth in BTL sales was falling". There is a difference!

You will almost certainly find that house prices in December and January fell significantly if you ignore the seasonal adjustments. If I can be arsed I will work it out (it has been years since I studied statistics).

If you think about the recent Nationwide figures, they are simply trying to spin a line in the same way as your BTL quote. The real news item would have read:

"Nationwide says that their own index that they have been rolling out for years was suddenly wrong in March because it didn't give the results that they wanted, so they instead provided an alternative statistics that fits in better with their corporate objectives and new business targets."

deemy2004

Yeh, lets see what Junes housing market report is
No amount of playing with the figures will avoid the fact that house prices are falling...

Pal

I think that the correct phrase is "House prices are trending downwards."