Halifax Jan +0.6% MoM -1.8% YoY

HAMISH_MCTAVISH

Commenting, Martin Ellis, Housing Economist, said:
"House prices in the three months to January were 0.9% lower than in the previous three months. Despite the slight downward movement in the underlying trend, prices increased by 0.6% in January.

"Notwithstanding monthly fluctuations, the average UK house price is very close to where it was eight months' ago, at around £161,000. The continuing very low level of interest rates has helped to support housing demand, resulting in little overall movement in house prices since last spring.

Low rates have contributed to mortgage payments falling to their lowest level as a proportion of disposable earnings for a new borrower for 14 years. A recent improvement in employment trends may also have supported demand.

"Prospects for house prices over the coming months will, to a large extent, depend on events in the Eurozone and the repercussions of developments there for the UK economy. If the UK can avoid a prolonged recession, we expect broad stability in house prices in 2012."
http://www.lloydsbankinggroup.com/media1/press_releases/2012_press_release_brands/halifax/0602_HPI.asp

Graham_Devon

Interesting that the Halifax now hold low interest rates as the key as to where the housing market is.

The Halifax, now part of Lloyds Banking Group, said that the price of the average home in the UK was very similar to the average value in the middle of 2011.

This had held up owing to the low level of interest rates, the lender said.

What they appear to be suggesting is that these record low rates have only held up the current price. So one could assume that increasing rates (which apart from a 0.5% drop there isn't much else that could happen) will see house prices declining.

And Tracy Kellett, managing director of UK buying agent BDI Home Finders, said: "House prices are being held artificially high by two key factors - an extreme lack of stock and historically low interest rates.

IveSeenTheLight

Graham_Devon wrote: »

Interesting that the Halifax now hold low interest rates as the key as to where the housing market is.

What they appear to be suggesting is that these record low rates have only held up the current price. So one could assume that increasing rates (which apart from a 0.5% drop there isn't much else that could happen) will see house prices declining.

When do you envisage that rates will rise?

HAMISH_MCTAVISH

Graham_Devon wrote: »

So one could assume that increasing rates (which apart from a 0.5% drop there isn't much else that could happen) will see house prices declining.

One could assume that increasing rates prematurely might see house prices decline, and make a reasonable although not certain case for it. Because whilst most people can afford higher rates, raising them would decrease business investment and increase the chances of recession, unemployment and all the other things that can then cause house price falls.

However rates are unlikely to increase until the wider economy recovers, and falling unemployment, increasing economic activity, improved lending and rising income are not usually conditions associated with falling house prices.;)

nollag2006

HAMISH_MCTAVISH wrote: »

Commenting, Martin Ellis, Housing Economist, said:
"House prices in the three months to January were 0.9% lower than in the previous three months. Despite the slight downward movement in the underlying trend, prices increased by 0.6% in January.

"Notwithstanding monthly fluctuations, the average UK house price is very close to where it was eight months' ago, at around £161,000. The continuing very low level of interest rates has helped to support housing demand, resulting in little overall movement in house prices since last spring.

Low rates have contributed to mortgage payments falling to their lowest level as a proportion of disposable earnings for a new borrower for 14 years. A recent improvement in employment trends may also have supported demand.

"Prospects for house prices over the coming months will, to a large extent, depend on events in the Eurozone and the repercussions of developments there for the UK economy. If the UK can avoid a prolonged recession, we expect broad stability in house prices in 2012."
http://www.lloydsbankinggroup.com/media1/press_releases/2012_press_release_brands/halifax/0602_HPI.asp

Wonder how long it will take brit to change his signature?

:rotfl:

Graham_Devon

IveSeenTheLight wrote: »

When do you envisage that rates will rise?

The timeframe in which rate rises may or may not rise isn't of that much importance to what was being said.

I take it you are going to suggest it could be a long time - and you would be correct. But it's only delaying the inevitable, which actually, one could argue, makes things very much worse.

HAMISH_MCTAVISH

nollag2006 wrote: »

Wonder how long it will take brit to change his signature?

Until the next time the index shows a fall.;)

More interestingly, Brit has been on here every week for the last 8 months shouting loudly about how house prices are falling, crashing, plummeting, etc.

Whereas in reality, and even on the perennially gloomy Halifax index....

Notwithstanding monthly fluctuations, the average UK house price is very close to where it was eight months' ago, at around £161,000.

nollag2006

HAMISH_MCTAVISH wrote: »

Until the next time the index shows a fall.;)

More interestingly, Brit has been on here every week for the last 8 months shouting loudly about how house prices are falling, crashing, plummeting, etc.

Whereas in reality, and even on the perennially gloomy Halifax index....

Bless him

I still chuckle when I think of the 50% down by Christmas 2009 thread.

:rotfl:

HAMISH_MCTAVISH

Graham_Devon wrote: »

The timeframe in which rate rises may or may not rise isn't of that much importance to what was being said.

I take it you are going to suggest it could be a long time - and you would be correct. But it's only delaying the inevitable, which actually, one could argue, makes things very much worse.

No Graham, the timing of rate rises really is quite important to the outcome.

If rates rise now, you could make a reasonable case that prices may fall.

If rates don't rise until unemployment is falling, bank lending is improving, business activity is increasing, and the economy recovering, then the chances of house price falls due to rising rates become very slim indeed.

Rinoa

When certain lenders are offering 10 year fixes at 3.99%, it's reasonable to assume that rates will remain low for many years.

the_flying_pig

interestingly this is the first time that the 7y-o-7y figure has been really noticably down.

one in the eye for fergus wilson.