London Has Peaked

padington

I reckon we may start seeing skewed results with £2 million plus properties tanking but everything else chugging on fairly well for a while possibly with a blip over September when Scotland freaked everyone out.

We might also see a rush on to qualify for a buy-to-let mortgage before Europe makes it more complicated to do so.

Bubble_and_Squeak

Libber wrote: »

Sorry to dig up an old post, but we now have the land registry data for August in London and it's showing an increase of 2.7%. Do you now accept that you were wrong about London having peaked in April?

if you dig up some more old posts you'll find that i also said that i don't know what kind of time lag there is between a sale being agreed and it actually showing up as sold on LR. a friend of mine agreed a price that took 10 months to complete, a colleague took 14 weeks another (cash buyer) colleague took 10 weeks.
another old post quotes a financial website that says the london LR figures for july are skewed by high end purchased. when stripped out hpi for london was 1.5%.

Generali

Bubble_and_Squeak wrote: »

if you dig up some more old posts you'll find that i also said that i don't know what kind of time lag there is between a sale being agreed and it actually showing up as sold on LR. a friend of mine agreed a price that took 10 months to complete, a colleague took 14 weeks another (cash buyer) colleague took 10 weeks.
another old post quotes a financial website that says the london LR figures for july are skewed by high end purchased. when stripped out hpi for london was 1.5%.

I think the lag averages 3 months but can be somewhere between 0 and 180 days.

AndyGuil

Almost every single transaction in the data is within 3 months. We already established that.

wotsthat

Bubble_and_Squeak wrote: »

another old post quotes a financial website that says the london LR figures for july are skewed by high end purchased. when stripped out hpi for london was 1.5%.

The 'stow was up again MoM. Do you see many Russian billionaires living in the houses there?

All sounds a little 'yeah but, no but..'.

Bubble_and_Squeak

AndyGuil wrote: »

Almost every single transaction in the data is within 3 months. We already established that.

how do you know that?
(genuine question)

Bubble_and_Squeak

wotsthat wrote: »

The 'stow was up again MoM. Do you see many Russian billionaires living in the houses there?

All sounds a little 'yeah but, no but..'.

interesting that the stow was up
asking prices in the stow have been falling for months
the percentage of asking prices achieved has been falling for months
amount of houses on the market has been increasing for months
hmm, let me think...
...ah the pennys dropped!
LR figures are a lagging indicator!
why didn't i think of that before!?

wotsthat

Yeah the 'stow has been in freefall for months - only users of Property Bee are in the know apparently.

And trust the BBC to not report the panic as London buyers since April have been heavily discounting prices just to get rid.

And the stats are massaged to make it look as though prices are still going up.

danothy

Bubble_and_Squeak wrote: »

i don't know what kind of time lag there is between a sale being agreed and it actually showing up as sold on LR

Oh for spaf's sake, not this again. It's quite simple:

The 'lag' in LR data, which is a record of what a property actually sold for and a record of the date on which it sold for that amount, is about three months. That means that we don't have the data in full for about three months, not that August's data (for example) pertains to anything but August. A simple study of the continual addition of data to the LR database shows that about 95% of sales are reported to the LR within three months of their completion date (date of the sale).

The 'lag' between exchange of contracts (where the offer price is firmly and bindingly set) and completion (the actual sale date recorded in the LR data) is typically one to two weeks. This lag can be longer, or can be a low as zero days. I'm yet to see a compelling argument for this lag being of significant size to skew or offset the LR data.

The 'lag' between an initial offer, what you seem to be referring to as the 'sale being agreed' and completion can be huge. Searches, surveys, finance, negotiations etc. all need to take place in that time. Thing is though, the initial offer is little more than expression of interest in the property. The amount and the sale isn't set bindingly and subject to revision based on a number of influences or abandonable completely. I suggest you go back and ask your friends and colleagues how long it was between exchange and completion, as the 'sale being agreed' is technically contract exchange, not the initial offer. Everything before that is market exploration and not part of the sale per se. This is more than a technicality though, which is why you are admonished so often for concentrating on asking prices.

Bubble_and_Squeak

danothy wrote: »

Oh for spaf's sake, not this again. It's quite simple:

The 'lag' in LR data, which is a record of what a property actually sold for and a record of the date on which it sold for that amount, is about three months. That means that we don't have the data in full for about three months, not that August's data (for example) pertains to anything but August. A simple study of the continual addition of data to the LR database shows that about 95% of sales are reported to the LR within three months of their completion date (date of the sale).

The 'lag' between exchange of contracts (where the offer price is firmly and bindingly set) and completion (the actual sale date recorded in the LR data) is typically one to two weeks. This lag can be longer, or can be a low as zero days. I'm yet to see a compelling argument for this lag being of significant size to skew or offset the LR data.

The 'lag' between an initial offer, what you seem to be referring to as the 'sale being agreed' and completion can be huge. Searches, surveys, finance, negotiations etc. all need to take place in that time. Thing is though, the initial offer is little more than expression of interest in the property. The amount and the sale isn't set bindingly and subject to revision based on a number of influences or abandonable completely. I suggest you go back and ask your friends and colleagues how long it was between exchange and completion, as the 'sale being agreed' is technically contract exchange, not the initial offer. Everything before that is market exploration and not part of the sale per se. This is more than a technicality though, which is why you are admonished so often for concentrating on asking prices.

in one instance an offer was made in october 2013 for x amount. the person selling accepted the offer and needed to find a property in order to downsize. by the time that the person found a property, had on offer accepted etc and the sale of the house they were selling completed 10 months had elapsed. therefore, the price that shows up on the LR figures was actually agreed 10 months ago. this is what i mean by lagging.
in another instance a similar scenario to the one above played out but this time it took 14 weeks. therefore the price that shows up on the LR figures was agreed 14 weeks ago, not on the date the LR actually shows it to be.
same goes for my cash buying colleague but in this instance it took 10 weeks.
as we can see the LR figures don't actually represent agreed sale prices for a particular month. they reflect a price that was agreed several months prior.