ianrobo1 Posted February 1, 2009 Share Posted February 1, 2009 the key will be when banks start lending to normal levels again What are normal levels? Are they the levels of lending which we saw in 2007? Or 2002? Or 1997? Also, bearing in mind that a significantproportion of the lending that was done in the UK was money which came from outside the UK (which has gone) then even UK bank returning to lending levels of 2007 would leave a major shortfall overall. as I posted before I say normal is hwo they lend not the amount, what we aw in the last three years was 'abnormal' Link to comment Share on other sites More sharing options...
snowychap Posted February 1, 2009 Share Posted February 1, 2009 as I posted before I say normal is hwo they lend not the amount, what we aw in the last three years was 'abnormal' Sorry, I saw that post only after I had posted mine. Didn't mean to ask you again but the other stuff still stands. Your view of normal is not what Merv/Gordo/Darling et al mean. Abnormal only in the last three years? I think it has been going on for a fair bit longer than that. Link to comment Share on other sites More sharing options...
ianrobo1 Posted February 1, 2009 Share Posted February 1, 2009 we discussed this at the time Snowy and whet I thougth Normal was, was lending to normal buisness's and peopel with good records and income and not dodgy ones, the thing is taht the level as to be set at a good level listeing to R5 discuss this today there is some signs the lending market is loosening up, not much but some like a doubling of mortgages in December compared to Novemeber Link to comment Share on other sites More sharing options...
snowychap Posted February 1, 2009 Share Posted February 1, 2009 I know we discussed what these terms mean and I think what you have suggested is sensible lending. It is not normal lending. It is not what we have been used to and it is not what industry/retail/government is on about when they are talking about normal levels. listeing to R5 discuss this today there is some signs the lending market is loosening up Green shoots? :lol: Link to comment Share on other sites More sharing options...
ianrobo1 Posted February 1, 2009 Share Posted February 1, 2009 no not at all but there is movement abeit very small, the general concesus was no recovery until the end of 2010 if that Link to comment Share on other sites More sharing options...
snowychap Posted February 1, 2009 Share Posted February 1, 2009 A recovery? :shock: Like this? Bank mortgage approvals down 52% The number of new mortgages for house buyers approved by the UK's banks fell last year by 52%. The British Bankers Association (BBA) said the number of these approvals went up from 17,000 in November to 22,000 last month. However, this was still 47% down on December 2007. The BBA said the December rise did not suggest a real recovery in lending and was "more likely to reflect delayed activity from November". "The banks approved less than half the 2007 number of loans for house purchase, reflecting falling demand from households facing greater economic uncertainty and double-digit falls in house prices over the year, which led to a wait-and-see mentality," said David Dooks of the BBA. Caution The figures show that people were becoming more cautious about their borrowing and spending as 2008 came to an end. The amount of money outstanding on credit cards dropped by £218m in December. And bank customers continued to pay off more of their overdrafts and personal loans than they took on. Total outstanding borrowing dropped by another £135m, the fifth monthly fall in a row. "Consumer credit was very weak in December as people reined in their credit card spending, despite early sales and heavy discounting by retailers," said Mr Dooks. "This consumer caution was also reflected in personal deposits, which rose strongly," he added. Shrinking market Despite rapidly falling interest rates, prices and sales appear still to be falling as the credit crunch continues to choke off the supply of mortgage funds, and lenders ration their available cash to only the most creditworthy of customers. The property website Hometrack said that house prices in England and Wales continued to fall this month, for the sixteenth month in a row. This was accompanied with another fall in the number of sales going through. Another property website, Globrix, reported that the number of sellers cutting their asking price had jumped this month. The number of price cuts more than doubled in the first three weeks of January compared with December. More than 14,000 people did this, with the average reduction being just over £21,000. I don't think it is sensible to make just month on month comparisons. Link to comment Share on other sites More sharing options...
PaulMcgrathsknees Posted February 1, 2009 Share Posted February 1, 2009 There may be more mortgages being agreed, but only because of repossessions and a realisation by homeowners that their houses aren't the cash cow they thought they were. Further depreciation in the housing market this year. Summer will be the time to see what happens as far as jobs etc are panning out. It will either steady to no movement by then another 5-10% down or be falling through the floor as our economy disintegrates. Link to comment Share on other sites More sharing options...
snowychap Posted February 1, 2009 Share Posted February 1, 2009 I am assuming that this was what you were referring to them talking about on radio 5, Ian: Mortgage lending doubled in December Mortgage lending doubled during December but the figure was only a quarter of the level seen 12 months early, the Bank of England said today. Net lending, which strips out redemptions and repayments, was £1.9 billion during the month, up from November's depressed level of £834 million. But the figure was still well down on lending levels in December 2007, when net lending totalled £7.72 billion. The number of mortgages approved for house purchase also increased after hitting a new record low in November, with 31,000 loans in the pipeline - up from 27,000 during the previous month. But although the number of mortgages approved for people moving home increased, the value of all loans approved fell to £8.72bn, the lowest level since December 1999. The fall was driven by a steep drop in the number of people remortgaging, with approvals for people switching to a new deal declining to 36,000, compared with 41,000 in November and a recent six month average of 66,000. The figures are in line with those reported by the British Bankers' Association earlier this week, which showed a 27 per cent jump in the number of mortgages approved for house purchase, although this was also off a record low base. The group cautioned against reading too much into the figures, saying the increase was likely to reflect delayed activity from November, when interest rates were cut by 1.5 per cent. ...more on link Link to comment Share on other sites More sharing options...
Gringo Posted February 6, 2009 Author Share Posted February 6, 2009 Green Shoots? Light at the end of the tunnel? Or Dead Cat? House prices 'up 1.9% in January' The price of UK homes rose by 1.9% in January, compared to December, according to the Halifax. However it warned that one month's figures did not indicate an end to the downward trend in prices, which it says have dropped 17.2% in the past year. The average house price has now reached £163,966, according to the Halifax. Last week, a survey by Nationwide suggested house prices fell by 1.3% in January, and they said job worries were putting off people buying homes. Martin Ellis, chief economist at the Halifax, said his bank's latest survey did not mean the property market had reached a turning point, after last year's dramatic slump in mortgage lending, completed sales and prices. "It's far too early to make any conclusion," he said. "The figures are going against the trend and our survey shows that if you compare the last three months to the previous three [months] then prices are still down significantly, by about 5%," he added. 'Modest rise' Market experts are still agreed that prices will keep falling this year, probably until the economy stops shrinking, with continued restrictions on credit reducing the number of people taking out mortgages. However earlier this month, the Bank of England reported that the number of new mortgages approved for home buyers had picked up slightly in December. The 31,000 mortgage approvals were up from 27,000 in November, though they were still the second lowest figure on record. Estate agents have also been reporting more would-be homebuyers registering with them, though so far these have not yet been converted into a consistent rise in sales. "The Halifax report is consistent with the recent modest rise in activity as shown in our own surveys," said Brigid O'Leary, a senior economist at the Royal Institution of Chartered Surveyors (Rics). The Bank of England has been cutting the base rate sharply in recent months in an effort to stave off recession. It is expected to trim the rate further later on Thursday, with most analysts expecting a cut from 1.5% to 1%. Different surveys One explanation for the Halifax survey recording a rise in prices in January, while the Nationwide reported a fall, is that they cover different time periods as well as just their own lending activity. "We report prices for the full calendar month, while the Nationwide reports sales from the 20th of one month to the 20th of the next, so they may have include some sales that took place at the end of December," Mr Ellis explained. When simply comparing the average price in January with the average price a year ago, the Halifax survey suggests that prices are down by 16.8% from £197,243 in January 2008. But the lender prefers to compare the average price for the past three months with the average price for the same period a year ago, which produces its current estimate of a 17.2% annual fall. Link to comment Share on other sites More sharing options...
ianrobo1 Posted February 6, 2009 Share Posted February 6, 2009 all we can say is at some point the prices will stop declining and slowly recover, I can not believe it would be now, but more like in a year to 18 months time Link to comment Share on other sites More sharing options...
snowychap Posted February 6, 2009 Share Posted February 6, 2009 Dead cat. Link to comment Share on other sites More sharing options...
leviramsey Posted February 6, 2009 VT Supporter Share Posted February 6, 2009 Link to comment Share on other sites More sharing options...
Gringo Posted February 26, 2009 Author Share Posted February 26, 2009 Miaow House prices plunge almost 18% House prices tracked by Nationwide, the UK's largest building society, fell by 1.8 per cent in February, and 17.6 per cent since the same time last year, new figures showed this morning. Nationwide said it thought house prices had not yet reached a trough. The mortgage lender, said that the average cost of a UK home is now £147,746 indicating that the UK housing market has still further to fall. The annual house price fall of 17.6 per cent – or £31,612 - is a record drop since the survey started in 1952. Link to comment Share on other sites More sharing options...
snowychap Posted March 5, 2009 Share Posted March 5, 2009 House prices 'dip a further 2.3%' House prices fell by another 2.3% in February in the UK, according to the country's biggest mortgage lender. HBOS, now part of Lloyds Banking Group, said that the average UK home was now worth £160,327. The lender said there were "tentative" signs that housing market activity was beginning to stabilise, but added 2009 would still be a difficult year. The lender's preferred annual change figure - which takes a three month average - is down 17.7%. When looking at February's prices, the cost of the average home was 17.8% lower last month than in February 2008. 'Downturn' The 2.3% monthly fall was more in line with the general downward trend in house prices seen over the past year than the 2% rise in prices reported in January by the lender. The group's housing economist Martin Ellis said that prices in the three months to February compared to the previous quarter - which provide a more balanced indicator of the underlying trend - were 3.6% lower. But he did have some guarded good news for those wanting to get on the property ladder. "While market activity remains at very low levels, there are some tentative signs that activity may be beginning to stabilise. The house price to earnings ratio - a key measure of housing affordability - has fallen to its lowest level for six years," he said. "Continuing pressures on incomes, rising unemployment and the negative impact of the dislocation of the financial markets on the availability of mortgage finance are, however, likely to mean that 2009 will be another difficult year for the housing market." The figures come a few days after rival lender, the Nationwide building society, reported that house prices fell 1.8% in February, taking the annual decline in prices to 17.6%. Although mortgages have become cheaper following a string of interest rate cuts, the demand from lenders for a high deposit, falling prices and householders' fears over job security have put the housing market under severe strain in the past year. Signs of optimism? According to the Halifax, house prices are now at the same level as they were in August 2004. Although Mr Ellis acknowledged that house prices were likely to continue falling in 2009, he said that homes were becoming more affordable. David Smith, senior partner at Dreweatt Neate estate agents, was more strident in predicting some light at the end of the tunnel for homeowners. "House prices may have fallen further, but we are now at the point, or certainly very close to the point, at which buyer and seller expectations converge," he said. "We firmly believe that now and the next six months are the trough for house prices." Well, one can't really fault the logic - as the price of something falls, it becomes more affordable. Genius. Link to comment Share on other sites More sharing options...
Gringo Posted March 5, 2009 Author Share Posted March 5, 2009 House prices 'dip a further 2.3%' Although Mr Ellis acknowledged that house prices were likely to continue falling in 2009, he said that homes were becoming more affordable. Well, one can't really fault the logic - as the price of something falls, it becomes more affordable. Genius.Au Contraire. As unemployment increases homes become less affordable. Link to comment Share on other sites More sharing options...
snowychap Posted March 5, 2009 Share Posted March 5, 2009 House prices 'dip a further 2.3%' Although Mr Ellis acknowledged that house prices were likely to continue falling in 2009, he said that homes were becoming more affordable. Well, one can't really fault the logic - as the price of something falls, it becomes more affordable. Genius. Au Contraire. As unemployment increases homes become less affordable. That doesn't impact upon the logic of the first statement, though (as, in my view, omitting other factors would be implicitly assuming that all other things remained equal). Once one expands the parameters to include something else then the logic may be different. Increasing unemployment would not alter the effect of the reduction in price on the affordability of something to those who were not unemployed. I think one could come up with an equation to look at the average reduction in the price of houses versus the increase in unemployment (and even factor in any reductions in private sector pay and increases in public sector pay) to plot a graph of change in affordability over time but I'm not going to. Link to comment Share on other sites More sharing options...
Awol Posted March 5, 2009 Share Posted March 5, 2009 I think one could come up with an equation to look at the average reduction in the price of houses versus the increase in unemployment (and even factor in any reductions in private sector pay and increases in public sector pay) to plot a graph of change in affordability over time but I'm not going to. LE-VIIIII !! Link to comment Share on other sites More sharing options...
leviramsey Posted March 5, 2009 VT Supporter Share Posted March 5, 2009 I was about to post: I think one could come up with an equation to look at the average reduction in the price of houses versus the increase in unemployment (and even factor in any reductions in private sector pay and increases in public sector pay) to plot a graph of change in affordability over time but I'm not going to. Why is everybody looking in my direction? IIRC, I only did one regression analysis for VT (I forget what it was about...). It's like that Frenchman named Pierre: Once upon a time (how do you like it so far) there was a master bridge builder named Pierre. He was world renowned, and was constantly under contract to design and then to supervise the fabrication of these wonderful bridges, all over the world. His potential was limitless. However, one night in Paris, he got drunk and was caught servicing another guy. Anyway, from that day forward, Pierre was not remembered as "Pierre the bridge builder", he was remembered as "Pierre the cocksucker." Link to comment Share on other sites More sharing options...
snowychap Posted March 5, 2009 Share Posted March 5, 2009 He he, sorry, rather set you up there. Link to comment Share on other sites More sharing options...
PaulMcgrathsknees Posted March 16, 2009 Share Posted March 16, 2009 About a fortnight ago: Here are the current rates loan to value 90% Lloyds 6.69% HSBC 6.58% Nationwide 6.59% Northern Rock 7.69% Interesting to check back next week! The housing market needs 10% deposit first time buyers to get it going again. This week: And ten days later....... Lloyds - 6.59% HSBC - 6.99% Nationwide - 6.59% Northern Rock - No mortgages offered So a 1.5% base rate cut means: 0.1% cut 0.41% increase nothing or downright rufusal respectively. You can forget house prices surviving in 2009 too. Minimum 10% further drop to come yet. And I think that is optimistic. My views posted on one of the other threads. Probably sits better on here Thought I'd have another look seeing as the credit freeze should be loosening the banks' purse strings and current rates are at 0.5%: (LTV 90%) Lloyds - 6.29% HSBC - 6.79% Nationwide - No mortgages offered Northern Rock - No mortgages offered So, no bounce in the market coming anytime soon. Need to get lending to FTB's! Link to comment Share on other sites More sharing options...
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