Mortgage Lending Rising Again

Rota

Bubble_and_Squeak wrote: »

indeed, some of the posters on this site are the polar opposite of those on HPC. complete and utter denial. its like two religions arguing over who has the best god

I disagree, in 2006 I knew something was up. Hair dressers ticking up brand new BMWs, every second advert on TV about "using your house as an ATM" (Ocean Finance) etc. That couldnt go on forever.

The last 18 months (NOT 10 years like in 2007-8) London prices have echoed this behaviour but it has been nipped in the bud with tighter mortgage prerequisites.

What do I see now? Well, I don't see any driver for a 20-30% correction. But I don't expect (or want) a 30% tick up. Those increases are not good.

AndyGuil

Bubble_and_Squeak wrote: »

yes they are
we have a bubble in london on the back of historical low transactions
or am i wrong?

I fully appreciate you don't want to spend time looking things up.

London sales volume land registry shows that late last year we hit just over 11,000 sales per month in London. Just before the recession we hit just over 13,000 per month. Monthly figures in the 2000s (before the recession) were between 7,697 and 17,148 per month. The shock of the recession brought volumes down but since July 2009 they have been mostly operating within the pre-recession range and since March 2012 they have never deviated from the range. The highest volumes of trade since the recession occurred at the end of last year. This year has been consistant and slightly higher than the beginning of last of last year, certainly normal as pre-recession numbers go.

HAMISH_MCTAVISH

Bubble_and_Squeak wrote: »

we have a bubble in london on the back of historical low transactions
or am i wrong?

You're wrong.

Unless your definition of "bubble" is somehow different to most people's....

If prices are high because of a genuine shortage, that is by definition not a bubble, it's the market using price to allocate goods in scarce supply.

There is a difference between a boom and a bubble.

We're in the early stages of a boom, but as the price rises are supported by the fundamentals of a massive housing shortage and growing population, and they're rising despite lending remaining very restricted, it's difficult/impossible to make a convincing case that it's a bubble.

Bubble_and_Squeak

wotsthat wrote: »

Shouldn't you have done a Google search before passing off your assertions as facts?

i thought it was common knowledge that we are in a trade war with russia, china has tightened credit controls and chinas property bubble has burst

Bubble_and_Squeak

HAMISH_MCTAVISH wrote: »

You're wrong.

Unless your definition of "bubble" is somehow different to most people's....

If prices are high because of a genuine shortage, that is by definition not a bubble, it's the market using price to allocate goods in scarce supply.

There is a difference between a boom and a bubble.

We're in the early stages of a boom, but as the price rises are supported by the fundamentals of a massive housing shortage and growing population, and they're rising despite lending remaining very restricted, it's difficult/impossible to make a convincing case that it's a bubble.

20+% growth is not a bubble?
i don't know about scotland but the housing shortage here in london is massively overplayed. see my earlier post about the build up of supply.
an anecdote-
3 weeks ago i emailed my notice to my landlord informing of my intent to vacate the property. within 3 hours i found another flat to move into and even managed to secure a slight discount on the advertised price. how would this be possible if there is a "massive housing shortage and growing population"?

Bubble_and_Squeak

AndyGuil wrote: »

I fully appreciate you don't want to spend time looking things up.

London sales volume land registry shows that late last year we hit just over 11,000 sales per month in London. Just before the recession we hit just over 13,000 per month. Monthly figures in the 2000s (before the recession) were between 7,697 and 17,148 per month. The shock of the recession brought volumes down but since July 2009 they have been mostly operating within the pre-recession range and since March 2012 they have never deviated from the range. The highest volumes of trade since the recession occurred at the end of last year. This year has been consistant and slightly higher than the beginning of last of last year, certainly normal as pre-recession numbers go.

i get confused with numbers
does this show that we currently have higher, lower or the same level of transactions compared to pre-crises?

padington

Bubble_and_Squeak wrote: »

20+% growth is not a bubble?
i don't know about scotland but the housing shortage here in london is massively overplayed. see my earlier post about the build up of supply.
an anecdote-
3 weeks ago i emailed my notice to my landlord informing of my intent to vacate the property. within 3 hours i found another flat to move into and even managed to secure a slight discount on the advertised price. how would this be possible if there is a "massive housing shortage and growing population"?

9.5 people want to buy the property you rent but it's not even for sale.

That's serious demand and zero supply. That's usually what's termed, a shortage.

Graham_Devon

Bubble_and_Squeak wrote: »

i don't know about scotland but the housing shortage here in london is massively overplayed.

It most certainly is. The lack of supply thing is just used to avoid having to discuss the possibility that it's a simple asset bubble.

If it were truly lack of supply pushing prices up, this wouldn't happen....

http://cloud.highcharts.com/show/eqihov

That's data released today from RICS showing housing demand in London.

How can that be if it's simply about lack of supply? Lack of supply is ONE issue. However, RICS go on to state that just the sentiment of an interest rate rise has put demand into reverse.

So the sentiment around interest rate rises and house prices having ramped up significantly in the last year puts the likely demand for homes in reverse. Far more powerful than lack of supply.

Bubble_and_Squeak

padington wrote: »

9.5 people want to buy the property you rent but it's not even for sale.

That's serious demand and zero supply. That's usually what's termed, a shortage.

i just done a rightmove search for N8 (the postcode i'm moving to), last 7 days
34 entries 9 of which have had the price reduced
what was that about a shortage??

Bubble_and_Squeak

Graham_Devon wrote: »

It most certainly is. The lack of supply thing is just used to avoid having to discuss the possibility that it's a simple asset bubble.

If it were truly lack of supply pushing prices up, this wouldn't happen....

http://cloud.highcharts.com/show/eqihov

That's data released today from RICS showing housing demand in London.

How can that be if it's simply about lack of supply? Lack of supply is ONE issue. However, RICS go on to state that just the sentiment of an interest rate rise has put demand into reverse.

So the sentiment around interest rate rises and house prices having ramped up significantly in the last year puts the likely demand for homes in reverse. Far more powerful than lack of supply.

at last!
someone on MSE talking sense!