uk property at bottom?

[ppproperty]

I have a feeling that although todays figures show the sharpest drop in the Nationwide index history that there is little more to drop, I base this theory on a number of factors.
Firstly there is still a huge shortage of houses in the uk and therefore a large demand, the employment figures are historicaly excelent and although down on last year, last month showed an increase in mortgages granted compared to the month before.
I believe that soon we will have adjusted to high energy costs as they appear to be here to stay and also sterlings position in the markets once these mental adjustments have taken place confidence will begin to return and early next year we will see once again record numbers of people moving into the investment property overseas market and in my case hopefully a large portion of that to the Portuguese sector.
ppp

[theburglar]

Have read a few items in UK media predicting another 20% drop still to come. Over building means around 3% of homes are vacant due to developers continuing to build.

[ppproperty]

Against all popular feeling.

It is widely known and reported that there is a housing shortage in the uk more than 50,000 houses will be needed in the south in the next ten years alone overbuilding is an American and Spanish problem but not a uk problem.
ppp

[Steve Netwriter]

UK House Prices to Rise by 25% States National Housing Federation

http://www.marketoracle.co.uk/Article5654.html

As you can see the existing NHF forecast for a 40% rise was made right at the peak of the UK housing market. In my opinion it is completely irrelevant for what seems like a vested interest in a rising housing market to come out with an annual bullish house price forecast, as those that followed NHF's 'forecast' have clearly paid the price in not only missing a 10% advance in house prices, but also suffering a fall of 10%, therefore a 20% deviation from the trend to date.

However, the latest 5 year forecast by NHF for a 25% rise which equates to a compounded rise of approx 4.5% per annum is a very, very safe forecast, for inflation as measured by RPI is also expected to oscillate around an average of 4.5% over the next 5 years and therefore the actual forecast is for ZERO REAL TERMS GAIN.

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Re demand:
When people get wealthier I think they occupy more housing per person.
During poorer times, they increase occupancy rates.
Maybe this demand won't be as big.
Not to mention the Polish plumbers leaving

One puzzle. If demand is so high, why are there so many houses available to buy ? There seems to be something missing here.

[ppproperty]

I agree with most of that however i think that borrowing will remain tight for some time. Bigger deposits will be needed in the future no bad thing for the long term future of the market.
ppp

[ppproperty]

Good news at least a little.

For the third month in a row more people are looking for property in the uk mortgage rates have fallen with three of the biggest lenders so perhaps those green shoots we all remember are popping their heads up also retail sales have surprisingly rallied so lets hope.
ppp

[LKSteve]

I'm not sure about property being at bottom, but one thing's for sure, it will bottom out at some stage and then come back up. Strong population growth in the UK ensures this.

[Steve Netwriter]

I think the rate of change has to go back up to 0% before it's hit the bottom



Not much sign of it stopping falling yet, yet alone levelling off, let alone rising back to 0%.

And just to compare this rate of fall in prices with what happened last time:

[LKSteve]

Cool Graph.

This is a cool graph. It looks like the drop in UK values is precipitous. I’m wondering if it is possible that the market in New Zealand could tank in such an accelerated fashion. Steve.

[gladdy]

Very intesting!
A friend of mine has a property in the UK - does it mean now that his house is worth less if he would sell it now?
I knew that the prices where crashing in the US but i hear the first time that it is as bad in the UK!

[Steve Netwriter]

House prices in the UK are indeed significantly lower.
Also unemployment is rising.

But, IMO it's a huge mistake to just look at house prices in the local currency.

The pound has dropped massively

Yet there appears to be very little news coverage on that.

So real wealth in all GBP denominated assets is very much down.

[Stevegoodey]

Interesting to note that British Telecom let 10,000 staff go today too.

This will all have to have an impact on UK house prices, I've got some friends in the city who say that there are some big companies looking real dodgy.

[Steve Netwriter]

Housing market 'far worse' than figures suggest

Online estate agent says latest figures underestimate fall in prices by two-thirds

By James Thompson
Friday, 14 November 2008

http://www.independent.co.uk/news/business/news/housing-market-far-worse-than-figures-suggest-1018081.html

House prices across the UK have already fallen far further than official data and market indicators suggest, Rightmove, the online estate agent warned yesterday, as it revealed that up to 300 estate agents were quitting its service every month.

While the latest figures from leading mortgage lenders such as Halifax suggest that prices are down by 15 per cent from their peak, Rightmove said the falls were up to two-thirds higher.

Miles Shipside, the commercial director of Rightmove, said: "Estate agents tell us that the actual prices that are being achieved [initially between buyers and sellers] for property are down by about 20 to 25 per cent beneath peak asking prices. That has not come out in the national indices."

[Steve Netwriter]

Where the US has gone the UK follows. Where the UK will go, NZ & Oz will follow:



A year into the crunch, £30,000 wiped off average house price
Annual rate of fall now 14.6 per cent, survey by Nationwide shows
By Sean O'Grady, Economics Editor
Friday, 31 October 2008

http://www.independent.co.uk/news/business/news/a-year-into-the-crunch-16330000-wiped-off-average-house-price-980247.html

The average British home has seen almost £30,000 wiped from its value since the market peaked this time last year, according to a survey from the Nationwide Building Society.

House prices reached an all-time high in October 2007, with the typical home selling for £186,044; that has slumped to £158,872. Many households have seen more money lost on their home than they managed to earn from their jobs over the past 12 months. House prices are falling at an annual rate of 14.6 per cent, up from 12.4 per cent in September; values fell by 1.4 per cent in October alone, or about £95 a day.

Economists are in broad agreement about where prices will go from here: down – by about 10 to 25 per cent from where they stand now, bottoming out in late in 2010 or 2011.

Ed Stansfield, property economist at Capital Economics, the most pessimistic of the forecasters, said: "Despite the fact that house prices are falling at their fastest pace on record, the housing market remains fundamentally overvalued by almost any measure. So as the economic downturn gathers pace, we still think that there is plenty of scope for the rate of house price deflation to accelerate."

[Steve Netwriter]

Rightmove loses 300 estate agents a month
This is Money
13 November 2008

http://www.thisismoney.co.uk/mortgages/article.html?in_article_id=457070&in_page_id=8&in_a_source=&ct=5

Property website Rightmove today reported that up to 300 estate agents were quitting the service each month as they struggled to survive the property downturn.

The firm, which last month announced it was cutting 20% of its workforce, said its agency membership was now 1,900 lower than the 12,600 peak a year ago.

At least three out of every four that have left Rightmove have either gone bust or were removed for failing to keep up with membership fees, according to the site.

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This reminds me of Thatcham in Berkshire in the last crash. Most of the shops were estate agents. Then most closed.