Property crash, just maybe it really is different this time (Part 2)

[darkmarket]

34 minutes ago, Axeman123 said:

I am of the opinion cuts will be unavoidable in the US by EOY. Mainly because they need inflation to errode their debt relative to GDP.

I expect some by the end of the year too, but too little and too late to be the dominant theme of the year. A few tantrums already suggest a certain panic in some quarters.

Inflation to manage debt and the temptation to run huge deficits are a factor, but they are balanced by a need to defend the Dollar. Even if only Powell seems remotely credible on that front for now, it'll be enough if he avoids a total climbdown.

I still expect things to break, and outside the US first. Maybe the forced selling implied by the Evergrande liquidation order is getting underway and that'll be the first big shock. Maybe it'll be in Europe - Meloni was already pleading for ECB cuts last year and Lagarde is now pincered.

In terms of property markets, cuts in response to a genuine crisis event are a different beast to cuts following a smooth landing. It'll be interesting to see what type we get eventually after the effects of the past few years wash through the system. For now though, the focus is on higher for longer and what that means for credit and property markets.

[JoeDavola]

3 hours ago, darkmarket said:

The imminent rate-cut boom narrative seeded in Q4 of last year is dead.

Only cause the poor sod was banned!

[AWW]

I think we're now where we were at the start of ZIRP, where expectations are for a "return to normal" within months. Look how long ZIRP dragged on for.

Sure, the media and a few million mortgagees will cheer a couple of quarter-percent cuts if they come this year, but that'll be their lot, and it won't materially change anything.  "Normal" for those who got used to ZIRP isn't coming back.

[AWW]

5 hours ago, darkmarket said:

Inflation to manage debt and the temptation to run huge deficits are a factor, but they are balanced by a need to defend the Dollar. Even if only Powell seems remotely credible on that front for now, it'll be enough if he avoids a total climbdown.

 

The dollar can be defended with guns as well as rates...

[jamtomorrow]

19 hours ago, PatronizingGit said:

I wonder if the best place to park money the last 10-15 years was irish property. Quite incredible how towns not all that far (<50 miles) from Dublin you could get newbuild detached on estates going for 50k-60k...or literal mansions or 100k when the developers went bust. Looking now & those same places are 500k-1million. Irish property looks even crazier than the UK. Again. 

From the outside this looks quite simple - it's a bubble blown on the massive proceeds of the racket where multinationals are incentivised to have their HQ and tax base in Ireland.

I saw it last year, first visit to the west of Ireland in 30 odd years and the difference in roads infrastructure is startling. Road surfaces like billiard tables, single carriageway trunk roads with mile upon mile of hard shoulder - all they're missing are gold-plated lamposts.

And very few cars on the road older than about 5 years.

To an outsider, the place is awash with money that bears little relation to the indiginous economy.

Of course, even if the building up of that tax revenue has been a decades-long project of not scaring the horses, it can up and leave almost overnight. That, to me, is the real risk in the Irish property market.

[HousePriceMania]

19 hours ago, spygirl said:

Complete moron. CLueless

Analysis

Posted at 13:2013:20

Any sign my mortgage rate will fall?

Kevin Peachey

Cost of living correspondent

The future direction of mortgage costs depends quite significantly on what is said, rather than what is done, on a day like today.

The governor has just been repeating a phrase about the removal of the "upside bias", which translates as concentrating on how long to keep rates where they are, rather than whether to put them up.

So, for mortgage lenders, there is still plenty of confidence of rate cuts later in the year, which means they can offer more competitive deals now.

But some brokers are already saying that, in failing to reduce the benchmark rate today, there has been a missed opportunity by the Bank to help accelerate those cuts.

 

https://www.dailymail.co.uk/news/article-13035465/nationwide-mortgage-prices-rise-rates-hold.html

Good use of the word HIKES.

[Plan-b]

23 minutes ago, HousePriceMania said:

 

https://www.dailymail.co.uk/news/article-13035465/nationwide-mortgage-prices-rise-rates-hold.html

Good use of the word HIKES.

Inflation that the Bank of England created itself together with the UK government.

[JoeDavola]

2 hours ago, jamtomorrow said:

From the outside this looks quite simple - it's a bubble blown on the massive proceeds of the racket where multinationals are incentivised to have their HQ and tax base in Ireland.

I saw it last year, first visit to the west of Ireland in 30 odd years and the difference in roads infrastructure is startling. Road surfaces like billiard tables, single carriageway trunk roads with mile upon mile of hard shoulder - all they're missing are gold-plated lamposts.

And very few cars on the road older than about 5 years.

To an outsider, the place is awash with money that bears little relation to the indiginous economy.

Of course, even if the building up of that tax revenue has been a decades-long project of not scaring the horses, it can up and leave almost overnight. That, to me, is the real risk in the Irish property market.

It’s quite incredible to have witnessed two Irish housing bubbles in less than 20 years.

Yet Dublin still looks like a run down shithole to me. The quality of life for the average Irish person is on the decline too - I’ve known three Irish blokes over the years who moved to NI as they were completely priced out of the area where they grew up in Ireland despite having decent jobs.

[spygirl]

1 hour ago, JoeDavola said:

It’s quite incredible to have witnessed two Irish housing bubbles in less than 20 years.

Yet Dublin still looks like a run down shithole to me. The quality of life for the average Irish person is on the decline too - I’ve known three Irish blokes over the years who moved to NI as they were completely priced out of the area where they grew up in Ireland despite having decent jobs.

I knew an irish kid from Uni (88).

His Dad was a Dr. 

When he was growing up (early 70s/80s) the family allotment was a major source of food/savings, otherwise theyd have struggled to eat.

 

[Guest]

3 hours ago, JoeDavola said:

It’s quite incredible to have witnessed two Irish housing bubbles in less than 20 years.

Yet Dublin still looks like a run down shithole to me. The quality of life for the average Irish person is on the decline too - I’ve known three Irish blokes over the years who moved to NI as they were completely priced out of the area where they grew up in Ireland despite having decent jobs.

Housing bubbles are not meant to benefit the ordinary working person, they are a mechanism to transfer wealth from the have-nots to the haves via high rents and the ability for multiple property owners to cash out at big numbers.

[HousePriceMania]

Anyone waiting for a better mortgage deal just got a hard kick in the balls/laddies "tory party".

[Axeman123]

13 hours ago, AWW said:

I think we're now where we were at the start of ZIRP, where expectations are for a "return to normal" within months. Look how long ZIRP dragged on for.

Very true. The implication of course is that the feckless will hang on for years before accepting the new way of things, as the prudent did with ZIRP. As a result many of the behviour changes higher interest rates are intended to produce will lag heavily.

6 hours ago, jamtomorrow said:

Of course, even if the building up of that tax revenue has been a decades-long project of not scaring the horses, it can up and leave almost overnight. That, to me, is the real risk in the Irish property market.

I wonder what impact Connor McGreggor and burning asylum hotels will have on all that? If the politics there swing away from luxury beleifs and low taxes you could see a real stampede, especially among those who have gained the EU passport and hence can live anywhere.

RoI already ended its golden visa scheme around a year ago, so the influx of new money has already ended AIUI. Qualification was previously >2M Euro networth and 1M Euro qualifying investment within the country for minimum 3 years, and could allow a whole family on on one application. After 5 years it even could lead to citizenship too. No wonder house prices in the nicer parts went up!

4 hours ago, HousePriceMania said:

Good use of the word HIKES.

Love it!

4 hours ago, JoeDavola said:

It’s quite incredible to have witnessed two Irish housing bubbles in less than 20 years.

Yet Dublin still looks like a run down shithole to me. The quality of life for the average Irish person is on the decline too - I’ve known three Irish blokes over the years who moved to NI as they were completely priced out of the area where they grew up in Ireland despite having decent jobs.

Golden Visa started in 2012, to rescue the deflating first bubble.

Those blokes were bidding for housing against multi-millionaires.

 

[spygirl]

On 01/02/2024 at 13:36, spygirl said:

There is some market wiggle room between base rate and market rates.

Its not much mind. And it can go the wrong way too.

Banks canot offer much in the way of ;competitive' rates -whatever that means.

And the BoE doesn't exist to make mortgage brokers life easy FFS.

UK inflation is4.0%. U krates need to be about 6.5%

And the big umentioned gorilla - Boe (adn the rst)wont do anything till the Fed lowers.

 

 

‘Stunning’ US jobs growth of 353,000 far outstrips estimates

Investors rein in interest rate cut expectations after January payrolls come in at almost double economists’ forecasts

[spygirl]

The job destruction from Cjinky mechantilism was *HUGE*

AS the USA actively reduce that, and as Chinkyland (PRD) has become very very expensive, *and* now that everyone accepts they are cunts, th flow back to the US- and rest of West is huge.

 

 

[spygirl]

From ~1998->2015 China was a massive price deflator.

From 2015 onwards, CHina is now a price inflator.

[spygirl]

22 minutes ago, spygirl said:

‘Stunning’ US jobs growth of 353,000 far outstrips estimates

Investors rein in interest rate cut expectations after January payrolls come in at almost double economists’ forecasts

Jesus

Big US jobs rise in January surprises again

https://www.bbc.co.uk/news/business-68183421

Its only a surprise if you spend your time listening to loads of daft lefty academic economists.

 

[MrXxxx]

I guess the recent mortgage 'price war' was transient then?!

https://www.msn.com/en-gb/money/other/nationwide-hikes-mortgage-prices-even-as-base-rate-is-held-in-wake-of-a-move-by-rival-santander/ar-BB1hESYx

[Axeman123]

27 minutes ago, MrXxxx said:

I guess the recent mortgage 'price war' was transient then?!

It is possible we have already seen the spring bounce (such as it was) come and go...

IMO it is worth having to see the HPI crowd crowing in December and January about rates coming down in time for the spring selling season, just because it meant we get to see them get served a shit sandwhich like today's news at the most painful moment.

[belfastchild]

6 hours ago, JoeDavola said:

It’s quite incredible to have witnessed two Irish housing bubbles in less than 20 years.

https://www.bbc.co.uk/news/uk-northern-ireland-68171637

Sherry Fitzgerald buys out Simon Brien.

2007 you say?

Or maybe getting the jump on a United Ireland ;-)

[sancho panza]

21 hours ago, darkmarket said:

I still expect things to break, and outside the US first. Maybe the forced selling implied by the Evergrande liquidation order is getting underway and that'll be the first big shock. Maybe it'll be in Europe - Meloni was already pleading for ECB cuts last year and Lagarde is now pincered.

In terms of property markets, cuts in response to a genuine crisis event are a different beast to cuts following a smooth landing. It'll be interesting to see what type we get eventually after the effects of the past few years wash through the system. For now though, the focus is on higher for longer and what that means for credit and property markets.

I think thats a sensisble thesis.Too mnay people imho view hosuing/real estate in isolation without realsing that it's dependednt upon a vibrant and expanding credit base to keep bubbling.Losses in banks,mean drawing in credit and banks going pop.

a £226mn loss on revenue of £111.8mn........mmmmm?

its write down tastic smashy......

also matters who's the patsy whther it's high st banks of pension funds.someones going to lose serious moeny on these in the next few years.

https://uk.finance.yahoo.com/news/property-giant-bruntwood-makes-worst-085622177.html

Property giant Bruntwood has slumped to its worst losses in its near 50-year history, it has been revealed.

Bruntwood has reported pre-tax losses of £226.5m for the year to October 2, 2023, according to newly-filed accounts, having posted a profit of £79.6m in the prior 12 months.

The Manchester-headquartered group is lead by chief executive Chris Oglesby who was awarded an OBE in the King’s Birthday Honours List last year.

 

The property group owns almost 100 landmark buildings and commercial spaces across Greater Manchester, Cheshire, Liverpool, Birmingham, Leeds and Glasgow.

Bruntwood Limited’s latest accounts also show its turnover increased from £108.5m to £111.8m over the year.

“our average valuation yield has moved from 6.74 per cent to 7.92 per cent which all other factors being equal would give rise to a 19 per cent movement in values.

“Our portfolio has, however, seen a 17 per cent decrease, with positive movements driven by our activity in increasing rental levels and reducing vacant.

“The valuation reduction is almost entirely due to external forces and leads to the loss on revaluation of £199.3m seen in our results.

 

 

 

edit to add via wiki

Bruntwood is a family-owned property company offering office space, serviced offices, retail space and virtual offices in the north of England and Birmingham in the United Kingdom. They own several high-profile buildings in the Manchester area, as well as in Liverpool, Leeds and Birmingham.

Bruntwood's portfolio of over 100 properties is worth over one billion pounds^[4] and includes over 560,000 square metres (6,000,000 sq ft) of floorspace.^[5]

In October 2018, Bruntwood announced a 50:50 partnership with Legal & General Capital focussed on science and technology in regional cities. The new partnership has been named Bruntwood SciTech. Interests include Circle Square and Alderley Park.^[6][7]

Alongside the creation of Bruntwood SciTech, the core work space assets were ring fenced into a business named Bruntwood Works, specialising in different types of workspace products from coworking and serviced offices to traditional leased offices.^[8]

Properties

Notable properties in the Bruntwood group include:

Birmingham

• Centre City Tower
• The McLaren Building

Manchester city centre

• 111 Piccadilly
• Afflecks
• Bank Chambers
• Manchester One
• St. James Buildings

Greater Manchester and Cheshire

• Millennium House, Stockport
• Abney Hall, Cheadle
• Alderley Park

Glasgow

• Met Tower

Liverpool

• Cotton Exchange
• Oriel Chambers
• The Plaza

Edited February 2 by sancho panza

[Democorruptcy]

6 minutes ago, sancho panza said:

I think thats a sensisble thesis.Too mnay people imho view hosuing/real estate in isolation without realsing that it's dependednt upon a vibrant and expanding credit base to keep bubbling.Losses in banks,mean drawing in credit and banks going pop.

a £226mn loss on revenue of £111.8mn........mmmmm?

https://uk.finance.yahoo.com/news/property-giant-bruntwood-makes-worst-085622177.html

Property giant Bruntwood has slumped to its worst losses in its near 50-year history, it has been revealed.

Bruntwood has reported pre-tax losses of £226.5m for the year to October 2, 2023, according to newly-filed accounts, having posted a profit of £79.6m in the prior 12 months.

The Manchester-headquartered group is lead by chief executive Chris Oglesby who was awarded an OBE in the King’s Birthday Honours List last year.

 

The property group owns almost 100 landmark buildings and commercial spaces across Greater Manchester, Cheshire, Liverpool, Birmingham, Leeds and Glasgow.

Bruntwood Limited’s latest accounts also show its turnover increased from £108.5m to £111.8m over the year.

Losing double your turnover is better than losing triple it.

[Plan-b]

1 hour ago, sancho panza said:

I think thats a sensisble thesis.Too mnay people imho view hosuing/real estate in isolation without realsing that it's dependednt upon a vibrant and expanding credit base to keep bubbling.Losses in banks,mean drawing in credit and banks going pop.

a £226mn loss on revenue of £111.8mn........mmmmm?

its write down tastic smashy......

also matters who's the patsy whther it's high st banks of pension funds.someones going to lose serious moeny on these in the next few years.

https://uk.finance.yahoo.com/news/property-giant-bruntwood-makes-worst-085622177.html

Property giant Bruntwood has slumped to its worst losses in its near 50-year history, it has been revealed.

Bruntwood has reported pre-tax losses of £226.5m for the year to October 2, 2023, according to newly-filed accounts, having posted a profit of £79.6m in the prior 12 months.

The Manchester-headquartered group is lead by chief executive Chris Oglesby who was awarded an OBE in the King’s Birthday Honours List last year.

 

The property group owns almost 100 landmark buildings and commercial spaces across Greater Manchester, Cheshire, Liverpool, Birmingham, Leeds and Glasgow.

Bruntwood Limited’s latest accounts also show its turnover increased from £108.5m to £111.8m over the year.

“our average valuation yield has moved from 6.74 per cent to 7.92 per cent which all other factors being equal would give rise to a 19 per cent movement in values.

“Our portfolio has, however, seen a 17 per cent decrease, with positive movements driven by our activity in increasing rental levels and reducing vacant.

“The valuation reduction is almost entirely due to external forces and leads to the loss on revaluation of £199.3m seen in our results.

 

 

 

edit to add via wiki

Bruntwood is a family-owned property company offering office space, serviced offices, retail space and virtual offices in the north of England and Birmingham in the United Kingdom. They own several high-profile buildings in the Manchester area, as well as in Liverpool, Leeds and Birmingham.

Bruntwood's portfolio of over 100 properties is worth over one billion pounds^[4] and includes over 560,000 square metres (6,000,000 sq ft) of floorspace.^[5]

In October 2018, Bruntwood announced a 50:50 partnership with Legal & General Capital focussed on science and technology in regional cities. The new partnership has been named Bruntwood SciTech. Interests include Circle Square and Alderley Park.^[6][7]

Alongside the creation of Bruntwood SciTech, the core work space assets were ring fenced into a business named Bruntwood Works, specialising in different types of workspace products from coworking and serviced offices to traditional leased offices.^[8]

Properties

Notable properties in the Bruntwood group include:

Birmingham

• Centre City Tower
• The McLaren Building

Manchester city centre

• 111 Piccadilly
• Afflecks
• Bank Chambers
• Manchester One
• St. James Buildings

Greater Manchester and Cheshire

• Millennium House, Stockport
• Abney Hall, Cheadle
• Alderley Park

Glasgow

• Met Tower

Liverpool

• Cotton Exchange
• Oriel Chambers
• The Plaza

CRE is going to be the post convid ground zero of interest rates reverting back to the pre GFC normal.

But in it's defence its only a dodgy handshake away from a government backed change in planning to allow habitation for our brand new citizens.

Edited February 2 by Plan-b

[Chewing Grass]

I have noticed a new trend on the sci-tech-bizziness park I roam around, the smaller individual units including Olympic Park that have been vacant, some since the London Olympics (whenever that was) have been let now at the expense of shared space (floors etc) within the large office blocks.

Some shared buildings have not seen a new letting for years.

[MrXxxx]

2 hours ago, Axeman123 said:

It is possible we have already seen the spring bounce (such as it was) come and go...

Must be down to Global Warming then! :-)))

[MrXxxx]

2 hours ago, sancho panza said:

I think thats a sensisble thesis.Too mnay people imho view hosuing/real estate in isolation without realsing that it's dependednt upon a vibrant and expanding credit base to keep bubbling.Losses in banks,mean drawing in credit and banks going pop.

a £226mn loss on revenue of £111.8mn........mmmmm?

its write down tastic smashy......

also matters who's the patsy whther it's high st banks of pension funds.someones going to lose serious moeny on these in the next few years.

https://uk.finance.yahoo.com/news/property-giant-bruntwood-makes-worst-085622177.html

Property giant Bruntwood has slumped to its worst losses in its near 50-year history, it has been revealed.

Bruntwood has reported pre-tax losses of £226.5m for the year to October 2, 2023, according to newly-filed accounts, having posted a profit of £79.6m in the prior 12 months.

The Manchester-headquartered group is lead by chief executive Chris Oglesby who was awarded an OBE in the King’s Birthday Honours List last year.

 

The property group owns almost 100 landmark buildings and commercial spaces across Greater Manchester, Cheshire, Liverpool, Birmingham, Leeds and Glasgow.

Bruntwood Limited’s latest accounts also show its turnover increased from £108.5m to £111.8m over the year.

“our average valuation yield has moved from 6.74 per cent to 7.92 per cent which all other factors being equal would give rise to a 19 per cent movement in values.

“Our portfolio has, however, seen a 17 per cent decrease, with positive movements driven by our activity in increasing rental levels and reducing vacant.

“The valuation reduction is almost entirely due to external forces and leads to the loss on revaluation of £199.3m seen in our results.

 

 

 

edit to add via wiki

Bruntwood is a family-owned property company offering office space, serviced offices, retail space and virtual offices in the north of England and Birmingham in the United Kingdom. They own several high-profile buildings in the Manchester area, as well as in Liverpool, Leeds and Birmingham.

Bruntwood's portfolio of over 100 properties is worth over one billion pounds^[4] and includes over 560,000 square metres (6,000,000 sq ft) of floorspace.^[5]

In October 2018, Bruntwood announced a 50:50 partnership with Legal & General Capital focussed on science and technology in regional cities. The new partnership has been named Bruntwood SciTech. Interests include Circle Square and Alderley Park.^[6][7]

Alongside the creation of Bruntwood SciTech, the core work space assets were ring fenced into a business named Bruntwood Works, specialising in different types of workspace products from coworking and serviced offices to traditional leased offices.^[8]

Properties

Notable properties in the Bruntwood group include:

Birmingham

• Centre City Tower
• The McLaren Building

Manchester city centre

• 111 Piccadilly
• Afflecks
• Bank Chambers
• Manchester One
• St. James Buildings

Greater Manchester and Cheshire

• Millennium House, Stockport
• Abney Hall, Cheadle
• Alderley Park

Glasgow

• Met Tower

Liverpool

• Cotton Exchange
• Oriel Chambers
• The Plaza

So in a 'nutshell', keep your capital in liquid assets,  in things of real/tangible value, and in a diverse portfolio.