Sellers acting with more savvy?

gingin_2

twhurl wrote: »

Ive noticed new properties coming on the market are at the peak prices so lately people are betting it will pick up

Here too....but imo they are "chancing" it, as here they are being put on at mickey mouse prices then being dropped 5-10% or so 4 weeks later. I believe sellers are putting it on at a "nothing to lose" price to see if there are any eager (muppet) buyers, which of course there aren't so many of.

gingin_2

mr.broderick wrote: »

I've noticed from your posts and threads you are very shy at giving your opinion but like to ask the question Jolanta.
What is your position? Are you one of the peeps hoping for a crash or are you mortgaged to the eyeballs aswell?

I have noticed this too and would be interested to hear

nollag2006

My own sense is that the market is usually very quiet at this time of year, so little can be read into any minor ups or downs in house price movements. In my home town of Harpenden, house prices are still rising.

The facts are that HIPs have caused the supply of properties on the market to dry up, somewhat, so this will prop up house prices in the short term as supply dries.

In addition to this, the BoE have made the right first step in reducing interest rates in December, and we should see (if the pundits are right) another 25bps coming off in Feb, so this will relieve some of the affordability constraints that many feel

Another thing the government could do, to help FTBs on to the ladder, is to follow the example of the Irish government, and substantially cut stamp duty for first time buyers.

twhurl

>>Another thing the government could do, to help FTBs on to the ladder, is >>to follow the example of the Irish government, and substantially cut stamp >>duty for first time buyers
They will probably do this if the market stalls as they are losing more stamp duty if the whole market grinds to a halt because of first time buyers

Phirefly

In real terms, what is so different to this time 12 months ago? Interest rates are stable, and people still have their jobs. The only thing thats changed tangibly is the prevailing mood in the media.

Turnbull2000

nollag2006 wrote: »

Another thing the government could do, to help FTBs on to the ladder, is to follow the example of the Irish government, and substantially cut stamp duty for first time buyers.

A possible consequence is that prices will rise by the equivalent of stamp duty. I'm sure there is already anecdotal evidence of this on the Irish Property Pin.

With the sum absorbed into a property's value it will no longer be a one-off expense - but instead cost a great deal more thanks to interest payments throughout the term of the mortgage.

Rather than assist first-time-buyers, some commentators have agreed that this is a scheme to simply prop up an unstable market. I'm with the commentators.

Turnbull2000

Phirefly wrote: »

In real terms, what is so different to this time 12 months ago? Interest rates are stable, and people still have their jobs. The only thing thats changed tangibly is the prevailing mood in the media.

Inflation, sentiment, credit crunch and global financial unease. Not exactly a drop in the ocean.

I'm surprised you haven't noticed!

Generali

Phirefly wrote: »

In real terms, what is so different to this time 12 months ago? Interest rates are stable, and people still have their jobs. The only thing thats changed tangibly is the prevailing mood in the media.

What has changed in the past 12 months is the credit markets. Banks aren't lending to each other (for the most part) as can be seen in their eagerness to borrow from you and I - look at average savings rates to see this. Whilst the best buys probably haven't shifted up too much, the rates overall have shot up IMO.

What we are likely to see next is an increase in credit quality demanded, that is to say that banks will be more reluctant to lend to higher risk clients (e.g. high LTV, patchy credit history, 'unusual' or risky property).

The losses the banks are racking up are perfectly tangable - UBS has had to write down another $10,000,000,000 today due to credit related troubles. If you've just lost a year's profits on something, it would be understandable if you'd be a little wary of that sector for a year or two.

Presumably, UBS will go back to what they're good at - sheltering money from the taxman and foreign invaders!

nollag2006 wrote: »

My own sense is that the market is usually very quiet at this time of year, so little can be read into any minor ups or downs in house price movements. In my home town of Harpenden, house prices are still rising.

The facts are that HIPs have caused the supply of properties on the market to dry up, somewhat, so this will prop up house prices in the short term as supply dries.

In addition to this, the BoE have made the right first step in reducing interest rates in December, and we should see (if the pundits are right) another 25bps coming off in Feb, so this will relieve some of the affordability constraints that many feel

Another thing the government could do, to help FTBs on to the ladder, is to follow the example of the Irish government, and substantially cut stamp duty for first time buyers.

I think that we'll see at least another 50bps off interest rates in 2008, quite possibly more. Lots of people are now saying 4% is likely by end 2009. I think you're more likely to predict the weather accurately in Dec '09 than interest rates but WTFDIK.

If my summation of the market is correct, supply and demand are out of kilter. If demand rises, for example due to interest rate cuts making it cheaper to buy a house, then Nollag's view of steady or increasing prices is perfectly possible. As per my explaination above though, the longer they are out of whack, the less likely that stagnation is to persist as more people become desperate to sell.

Phirefly

Turnbull2000 wrote: »

Inflation, sentiment, credit crunch and global financial unease. Not exactly a drop in the ocean.

I'm surprised you haven't noticed!

I hear the news, I hear about those things. But the people around me, friends, colleagues, family, are still earning the same amount or more, still have the same aspirations and those with mortgages are still spending the same on their long-term fixed rates every month.

dolce_vita

Phirefly wrote: »

In real terms, what is so different to this time 12 months ago? Interest rates are stable, and people still have their jobs. The only thing thats changed tangibly is the prevailing mood in the media.

Congratulations.

You have just won the daftest post of the week award.



And it's only monday.

:T