Property crash, just maybe it really is different this time

[spygirl]

6 minutes ago, goldbug9999 said:

With respect though youve been pointing out a lot of these sorts stats for some time now and so far the gov has simply printed its way all over all this reasonable and sound logic of yours and I'm not seeing any signs that this is going to change.

Money nots gone into housing - mortgages sales are still very low.

The only gormless idea of any  substance has been HTB.

The money went on shitty newbuilds,. which are massively under water 5 years down

Clusterfuck.

 

 

[Bus Stop Boxer]

On 22/03/2021 at 23:28, Warlord Velmoth said:

Should have mentioned that first. What the fuck do people expect, living in fucking Croydon? Its like complaining your foot stinks after deliberately stepping in dog shit.

Croydon is the arsehole of Britain.

[Hancock]

7 hours ago, goldbug9999 said:

With respect though youve been pointing out a lot of these sorts stats for some time now and so far the gov has simply printed its way all over all this reasonable and sound logic of yours and I'm not seeing any signs that this is going to change.

I think its a case of waiting until furlough ends, if it does and we can then see where the market is going. Last 10 months has just been helicopter money falling from the sky, this should be calming down soon.

In 2007 prices were insane, but on the basis wage inflation hasn't been that high since then the prices in 2021 are so far out of line that somethings got to give.

[Wight Flight]

10 hours ago, Hancock said:

I think its a case of waiting until furlough ends, if it does and we can then see where the market is going. Last 10 months has just been helicopter money falling from the sky, this should be calming down soon.

In 2007 prices were insane, but on the basis wage inflation hasn't been that high since then the prices in 2021 are so far out of line that somethings got to give.

While landlords are prepared to accept 3% yields, prices won't drop.

[Frank Hovis]

51 minutes ago, Wight Flight said:

While landlords are prepared to accept 3% yields, prices won't drop.

Yes, though because the great majority of people in this country have a binary idea of investing - property or cash deposits - then if interest rates do ever return to normal levels - 5% on your building society passbook - then the price of those houses will tumble to meet that yield; bringing down the rest as well.

3% on £500k = 5% on £300k

[Wight Flight]

10 minutes ago, Frank Hovis said:

Yes, though because the great majority of people in this country have a binary idea of investing - property or cash deposits - then if interest rates do ever return to normal levels - 5% on your building society passbook - then the price of those houses will tumble to meet that yield; bringing down the rest as well.

3% on £500k = 5% on £300k

Agreed. If interest rates go up even 1% anything could happen.

It is a big if though.

[Hancock]

1 hour ago, Wight Flight said:

While landlords are prepared to accept 3% yields, prices won't drop.

So why did Sunak have to create the SDLT holiday?

[Frank Hovis]

35 minutes ago, Wight Flight said:

Agreed. If interest rates go up even 1% anything could happen.

It is a big if though.

 

It's clearly a "when".  The problem is that I don't see that "when" as imminent though the 30 Year US bond yield is looking promising in having seen the bottom and now climbing out of it.  This could be the sign that liquidity is now going to tighten and rates will start rising; albeit very slowly at first.

[Hancock]

 

All these house purchases brought forward. I look forward to the end of SDLT holiday in September.

https://www.telegraph.co.uk/business/2021/03/29/house-buying-frenzy-pushes-mortgage-lending-five-year-high/

 Mortgage lending hit a five-year high last month as eager buyers borrowed a net £6.2bn in the frenzy to move before the now-extended stamp duty holiday comes to an end.

A total of 87,700 mortgages were approved for home purchases in February, the Bank of England said, down from more than 100,000 in November and December, but still one of the highest numbers since 2007, before the financial crisis struck.

Homebuyers have not borrowed this much since March 2016, when the market was also distorted by stamp duty changes. In that instance, buyers and investors were rushing into the market before the 3pc second home surcharge came into force, pushing up costs for landlords.

This time around the boom may be more sustained as the stamp duty holiday on sales below £500,000 has been extended to the end of June and will be tapered in the subsequent months, while Covid lockdowns and working from home have pushed buyers to reassess the types of property they need.

“We suspect that mortgage lending will remain high this year given the extension to the stamp duty holiday and the strength of the survey data,” said Andrew Wishart at Capital Economics.

As a result, mortgage approvals for house purchase are likely to reach their highest level since 2007 this year.”(WHAT HAPPENED AFTER THAT)

At the same time lockdown rules meant families had few opportunities to spend their incomes, letting them pay down another £1.2bn of credit card debt, and pile up another £17.1bn in savings - a stockpile that economists hope will fuel a post-Covid boom in spending.

Andy Haldane, the Bank of England’s chief economist, has described the economy as “a coiled spring” ready to bounce back when restrictions are eased.

Over the past 12 months deposits climbed by more than £180bn. This is more than three times the usual rate of savings.

The exact lift from these savings and pent-up demand will depend on how much households choose to spend, as they may feel safer keeping some extra savings in the bank given the economy has suffered an enormous shock from Covid.

The Bank of England estimates around 5pc will be spent, giving a modest lift to demand.

This may end up going towards housing and holidays, rather than day-to-day consumer spending.

“Households likely will reserve some of this cash for imported goods and services - especially new cars and foreign holidays - while others will keep a precautionary buffer or top up their underperforming pensions,” said Samuel Tombs at Pantheon Macroeconomics.

“What’s more, the rise in high loan-to-value (LTV) ratio mortgage rates has created a strong incentive for households to use surplus cash to reduce the size of their mortgage in order to drop down to a lower LTV ratio when refinancing.

“Households’ desire to pay off debt can also be seen in February’s record high level of ad hoc lump sum mortgage repayments. So, while we continue to expect households’ spending to recover quickly, we do not expect it to exceed pre-Covid levels in the next 12 months.

SUNAK IS A #### CUNT!

  

Edited March 29, 2021 by Hancock

[sancho panza]

On 29/03/2021 at 18:54, Hancock said:

 

All these house purchases brought forward. I look forward to the end of SDLT holiday in September.

https://www.telegraph.co.uk/business/2021/03/29/house-buying-frenzy-pushes-mortgage-lending-five-year-high/

 Mortgage lending hit a five-year high last month as eager buyers borrowed a net £6.2bn in the frenzy to move before the now-extended stamp duty holiday comes to an end.

A total of 87,700 mortgages were approved for home purchases in February, the Bank of England said, down from more than 100,000 in November and December, but still one of the highest numbers since 2007, before the financial crisis struck.

Homebuyers have not borrowed this much since March 2016, when the market was also distorted by stamp duty changes. In that instance, buyers and investors were rushing into the market before the 3pc second home surcharge came into force, pushing up costs for landlords.

This time around the boom may be more sustained as the stamp duty holiday on sales below £500,000 has been extended to the end of June and will be tapered in the subsequent months, while Covid lockdowns and working from home have pushed buyers to reassess the types of property they need.

“We suspect that mortgage lending will remain high this year given the extension to the stamp duty holiday and the strength of the survey data,” said Andrew Wishart at Capital Economics.

As a result, mortgage approvals for house purchase are likely to reach their highest level since 2007 this year.”(WHAT HAPPENED AFTER THAT)

At the same time lockdown rules meant families had few opportunities to spend their incomes, letting them pay down another £1.2bn of credit card debt, and pile up another £17.1bn in savings - a stockpile that economists hope will fuel a post-Covid boom in spending.

Andy Haldane, the Bank of England’s chief economist, has described the economy as “a coiled spring” ready to bounce back when restrictions are eased.

Over the past 12 months deposits climbed by more than £180bn. This is more than three times the usual rate of savings.

The exact lift from these savings and pent-up demand will depend on how much households choose to spend, as they may feel safer keeping some extra savings in the bank given the economy has suffered an enormous shock from Covid.

The Bank of England estimates around 5pc will be spent, giving a modest lift to demand.

This may end up going towards housing and holidays, rather than day-to-day consumer spending.

“Households likely will reserve some of this cash for imported goods and services - especially new cars and foreign holidays - while others will keep a precautionary buffer or top up their underperforming pensions,” said Samuel Tombs at Pantheon Macroeconomics.

“What’s more, the rise in high loan-to-value (LTV) ratio mortgage rates has created a strong incentive for households to use surplus cash to reduce the size of their mortgage in order to drop down to a lower LTV ratio when refinancing.

“Households’ desire to pay off debt can also be seen in February’s record high level of ad hoc lump sum mortgage repayments. So, while we continue to expect households’ spending to recover quickly, we do not expect it to exceed pre-Covid levels in the next 12 months.

SUNAK IS A #### CUNT!

  

Let's get some longer term perspective on this number.The numbers involved suggest this is avery much an equity swapping market in the upper echolons of the market.

If anyhting ,in nominal terms they're declining as we head into the spring market,so probably neutral on last year by year end.

Will get interesting when they end furlough.

https://tradingeconomics.com/united-kingdom/mortgage-approvals

 

[sancho panza]

a far more worrying set of issues come from the charts below.Huge chunks of the market are expsoed to a 20% dowturn in the market or job losses..

https://www.fca.org.uk/data/commentary-mortgage-lending-statistics-q4-2020

The proportion of lending to borrowers with a high loan to income (LTI) ratio increased by 2.0pp on the quarter to 50.2%, the highest since 2007 Q1 when the series began (Chart 4). Borrowers with high LTI are defined here as:

Borrowers with single income who had a LTI ratio of 4 or above. These loans accounted for 11.3% of gross mortgage lending in Q4 2020, unchanged from the previous quarter.

Borrowers with a joint income who had a LTI of 3 or above. These loans accounted for 38.9% of gross mortgage lending in Q4 2020, a 2.0pp increase compared to the previous quarter.

[Hancock]

2 minutes ago, sancho panza said:

Let's get some longer term perspective on this number.The numbers involved suggest this is avery much an equity swapping market in the upper echolons of the market.

If anyhting ,in nominal terms they're declining as we head into the spring market,so probably neutral on last year by year end.

Will get interesting when they end furlough.

https://tradingeconomics.com/united-kingdom/mortgage-approvals

 

I am sitting here very content that house prices are so detached from reality, that come September the crash will have begun.

When shit like this is seeking £300,000 you know its time for the party to end. Presumably they didnt even get a call for 2 weeks as the money grabbing cunts thought that a new kitchen, bathroom, with some cheap flooring along with a coat of magnolia made it worth £325,000.

[spygirl]

On 29/03/2021 at 17:54, Hancock said:

 

All these house purchases brought forward. I look forward to the end of SDLT holiday in September.

https://www.telegraph.co.uk/business/2021/03/29/house-buying-frenzy-pushes-mortgage-lending-five-year-high/

 Mortgage lending hit a five-year high last month as eager buyers borrowed a net £6.2bn in the frenzy to move before the now-extended stamp duty holiday comes to an end.

A total of 87,700 mortgages were approved for home purchases in February, the Bank of England said, down from more than 100,000 in November and December, but still one of the highest numbers since 2007, before the financial crisis struck.

Homebuyers have not borrowed this much since March 2016, when the market was also distorted by stamp duty changes. In that instance, buyers and investors were rushing into the market before the 3pc second home surcharge came into force, pushing up costs for landlords.

This time around the boom may be more sustained as the stamp duty holiday on sales below £500,000 has been extended to the end of June and will be tapered in the subsequent months, while Covid lockdowns and working from home have pushed buyers to reassess the types of property they need.

“We suspect that mortgage lending will remain high this year given the extension to the stamp duty holiday and the strength of the survey data,” said Andrew Wishart at Capital Economics.

As a result, mortgage approvals for house purchase are likely to reach their highest level since 2007 this year.”(WHAT HAPPENED AFTER THAT)

At the same time lockdown rules meant families had few opportunities to spend their incomes, letting them pay down another £1.2bn of credit card debt, and pile up another £17.1bn in savings - a stockpile that economists hope will fuel a post-Covid boom in spending.

Andy Haldane, the Bank of England’s chief economist, has described the economy as “a coiled spring” ready to bounce back when restrictions are eased.

Over the past 12 months deposits climbed by more than £180bn. This is more than three times the usual rate of savings.

The exact lift from these savings and pent-up demand will depend on how much households choose to spend, as they may feel safer keeping some extra savings in the bank given the economy has suffered an enormous shock from Covid.

The Bank of England estimates around 5pc will be spent, giving a modest lift to demand.

This may end up going towards housing and holidays, rather than day-to-day consumer spending.

“Households likely will reserve some of this cash for imported goods and services - especially new cars and foreign holidays - while others will keep a precautionary buffer or top up their underperforming pensions,” said Samuel Tombs at Pantheon Macroeconomics.

“What’s more, the rise in high loan-to-value (LTV) ratio mortgage rates has created a strong incentive for households to use surplus cash to reduce the size of their mortgage in order to drop down to a lower LTV ratio when refinancing.

“Households’ desire to pay off debt can also be seen in February’s record high level of ad hoc lump sum mortgage repayments. So, while we continue to expect households’ spending to recover quickly, we do not expect it to exceed pre-Covid levels in the next 12 months.

SUNAK IS A #### CUNT!

  

Even in the depths of the 90-95ish housing crash, mortgage sales less than 100k/m were seen as dire, sign trouble.

Now, 25 years later and with a population 15m-20m bigger the best go go market tops out at 80k.

You can look at Sanchez chart and see that mortgages are barely about 2008, when the arse fell out of the market if not prices.

Most of the UK does not have a housing market. It's a probate market.

The fun figures, if you can get them is number of deaths v number and amount mortgages being advance to the under 45s.

My guess - and it's a guess as I cant get the numbers - is the number of under 45s buying used houses I.e. not HTB is tiny.

I'd love to see the number of homeowners over 60 v homeowners under 40.

You cannot have a buoyant market with so few owners under 40- Noone to sell to.

 

Edited March 31, 2021 by spygirl

[Noallegiance]

6 hours ago, Hancock said:

I am sitting here very content that house prices are so detached from reality, that come September the crash will have begun.

When shit like this is seeking £300,000 you know its time for the party to end. Presumably they didnt even get a call for 2 weeks as the money grabbing cunts thought that a new kitchen, bathroom, with some cheap flooring along with a coat of magnolia made it worth £325,000.

I'll raise you...

[UmBongo]

 

Just now, Noallegiance said:

I'll raise you...

I shouldn't laugh but that's way out of my price range.

I live near to this house below, which sold within a few days. Houses on this estate used to take weeks to sell.

 

[AWW]

On 27/03/2021 at 11:03, Frank Hovis said:

It's clearly a "when".  The problem is that I don't see that "when" as imminent though the 30 Year US bond yield is looking promising in having seen the bottom and now climbing out of it.  This could be the sign that liquidity is now going to tighten and rates will start rising; albeit very slowly at first.

Needs to break through 3% to confirm that bottom though - so still quite a long way to go.

I'm not even sure there's a zero floor any more, given how hard it is to acquire and spend large sums of cash.

[Hancock]

1 hour ago, Noallegiance said:

I'll raise you...

Jesus fucken Christ, i stayed in Basildon about a 12 years ago when working at Coryton refinery, it must have gone right up market if thats allegedly worth £325k.

People say the current prices aren't as bad as 2007, i think the shithouses shown prove otherwise.

[Noallegiance]

57 minutes ago, UmBongo said:

 

I shouldn't laugh but that's way out of my price range.

I live near to this house below, which sold within a few days. Houses on this estate used to take weeks to sell.

 

Even £170k is a joke for that.

My parents snaffled a large 4 bed semi in one of the poshest parts of town in 1994 for £114k.

[Noallegiance]

1 minute ago, Hancock said:

Jesus fucken Christ, i stayed in Basildon about a 12 years ago when working at Coryton refinery, it must have gone right up market if thats allegedly worth £325k.

People say the current prices aren't as bad as 2007, i think the shithouses shown prove otherwise.

It's referred to locally as Basildump and is the laughing stock of the county. It has some nice bits but they're on the periphery.

[Hancock]

Just now, Noallegiance said:

It's referred to locally as Basildump and is the laughing stock of the county. It has some nice bits but they're on the periphery.

That house is a prefab in its final years, on a small plot of land, presumably in a bad area.

Are you looking to leave the area?

[Noallegiance]

2 minutes ago, Hancock said:

That house is a prefab in its final years, on a small plot of land, presumably in a bad area.

Are you looking to leave the area?

I'm not near it. Just know it. I'm good renting where I am for the moment but getting older with a growing family.

This has to be peak crazy. I'm not religious, but I may start speaking to fictitious deities soon.

[Hancock]

2 minutes ago, Noallegiance said:

I'm not near it. Just know it. I'm good renting where I am for the moment but getting older with a growing family.

This has to be peak crazy. I'm not religious, but I may start speaking to fictitious deities soon.

Yes the only person who'd buy that is a landlord, to stick some homeless families in.

 No one who goes to work for their £150 a day is going to entertain buying that shithole. I reckon the average woman would leave you, if you bought that as the "forever home".

 

[afly]

1 hour ago, Noallegiance said:

I'll raise you...

Sold for £225 in 2017. £100k in 4 years. Must be that totally subtle door replacement

 

https://www.rightmove.co.uk/house-prices/detailMatching.html?prop=103570106&sale=55370042&country=england

[Hancock]

Seeing loads of houses going up for sale via "modern auction method". 

Which seems like a way of generating vastly more profit from each sale for the agent. Imagine having to transfer £12,000 to an estate agent for the privilege of paying £280,000 for this 3 bed terrace. 
https://www.rightmove.co.uk/properties/103872689#/

So the buyer pays a significant deposit that they'll lose if they change their mind or cant get the mortgage, which takes away any bargaining power once a surveyor finds any problems.

Really does seem like a lose lose situation for the buyer, as the houses aren't cheaper than what's currently on the market and buyer can turn down all bids!

Anyone know if the seller also has to pay the agents commission?

 

[CVG]

On 01/04/2021 at 18:13, Hancock said:

Seeing loads of houses going up for sale via "modern auction method". 

Which seems like a way of generating vastly more profit from each sale for the agent. Imagine having to transfer £12,000 to an estate agent for the privilege of paying £280,000 for this 3 bed terrace. 
https://www.rightmove.co.uk/properties/103872689#/

So the buyer pays a significant deposit that they'll lose if they change their mind or cant get the mortgage, which takes away any bargaining power once a surveyor finds any problems.

Really does seem like a lose lose situation for the buyer, as the houses aren't cheaper than what's currently on the market and buyer can turn down all bids!

Anyone know if the seller also has to pay the agents commission?

 

Try this site. They say no sale fees but don't mention who pays to put the legal pack together. Also no mention of surveys and how they affect the transaction.

https://modernauction.co.uk/