House prices

[Twiglets1]

Hi Guys, we got to the end of the last thread so need another one on this controversial topic!

And to respond to @CrashyTime I don't say "demand is strong" over and over again. In fact, I rarely comment on demand at all. My posts are more focussed on house prices and interest rates/mortgage rates.

And I don't deny economic "reality", I just don't exaggerate how bad the house price correction is likely to be. I have a running bet with @XVGN that property prices generally will fall about 5% in 2023 and another 5% in 2024 so I do believe prices are falling in most areas. Just nothing like the 30-35% crash predicted by some!

I don't mind the media not covering partial indices from private companies. I do mind them not reporting the formal government statistics.

Apparently, the BBC have asked their journalists to consider this, so we'll see how they respond this month.

I don’t feel like the media is deliberately avoiding talking about regional variations @DrySherry I’ve read about them from lots of various sources

Big U.S bond auction ahoy, place your bets and buckle up!

https://www.swissinfo.ch/eng/bloomberg/bonds-fall-before-record-auction--us-futures-rise--markets-wrap/49192932

The house is now SSTC 🙃 EA hasn't yet cancelled our second viewing. Maybe he will soon.

Trying not to get down about it but it's our own fault for looking before being on the market! We're going up next week and I will just wait until we are SSTC now. I loved the house 😢

The bond markets are coming for all the governments. Globally many banks and investors have huge bond portfolios and we are talking about a market which is much bigger than the stock market and housing markets put together. Just to put this in context the bond market is worth over $130 trillion.

Unrealized losses now account for - 33% of all bank equity capital in the US.
Currently, banks are sitting on nearly $700 billion of unrealized losses. To put this in perspective, even at the worst point in 2008, unrealized losses only accounted for - 5% of equity capital. Just In the USA I think around $2 trillion of government treasuries (bonds) are maturing this year but the holders are going to struggle to sell them because they have already lost 40% in value and no investors in the right mind will touch these as they are garbage.

When these large banks and corporations were loading up on these bonds interest rates were at 0% and once interest rates started to rise because of inflation these bonds dropped in value. They always thought the rates would never go up. We should expect to see a wave of bank failures and it looks like this has already started with New York Community Bank whose shares dropped 50% in 24 hours.

Yes, NYCB is worth watching, Yellen and the ECB have been making panicked noises about CRE as well recently, a lot of dominoes could be poised to fall.

The ONS will report on the official house prices tomorrow. I'm not expecting to see any significant numbers. The bigger interest for me is whether or not the BBC will again refuse to report on the official data.

Your particular bugbear @XVGN 😉

Yeah, I just find it fascinating. The country is obsessed with house prices. They even make adverts on telly about people guessing what homes are worth. But our principal news organisation is doing everything in its power not to report them.

Did the BBC report on house prices every few months historically? I’ve only seen the Zoopla adverts for discussing house prices, which is a ‘service’ Zoopla are trying to sell. Are there other adverts?

Yes, although their search facility on the news site is so ropey that it is difficult to prove. I know that they haven't reported for the last 3 months despite other articles on the Halifax and Nationwide indices.

No, it's the Zoopla adverts I was referring to as an indication of public interest in house prices. The BBC claim that public interest is one of the factors behind whether an item is reported or not. I struggle to believe that there is greater interest in the UK in whether an actors face was made for TV (that was one of the articles last month in the top news section on the BBC website on the day that they failed to report the ONS stats).

Well let's see what happens tomorrow. I did give them some advance notice last week that the data gets reported tomorrow.

i just googled ‘house prices Bbc’ and switched to the new section on Google and there are results dated almost monthly. I wasn’t aware BBC reported on house prices on the rise or the slump but Google think they do. Maybe your news feed settings could be adjusted?

I think it’s misleading to say the Zoopla ad represent a large public interest in house prices, given that’s a product/ service that Zoopla are trying to sell.

I see that, but you're looking at many reports from Nationwide and Halifax. We want to see the official government ONS data reported - not small samples from private companies.

It's an indication of public interest the fact that a company makes a joke of it.

Interesting to see again the regional differences with areas that have falling prices and areas that have still seen an increase in 2023. This time info by Savills. Historically London leads the way in terms of trends, up or down, with other areas following later. Will it be different this time, partly facilitated by wfh ? Are we seeing an improvement in North/South divide or will the better performing regions start catching up with the London trend downward ?
"The UK’s housing stock has seen its first annual decline in value since 2012 after some £27bn was wiped off last year, according to new analysis, amid higher mortgage costs and pressure on household finance."

Housing stock value. Change from 2022

London
Minus £39.3bn

South East
Minus £6.1bn

East of England
Minus £6.4bn

South West
Minus £4.0bn

North West
plus £3.0bn

West Midlands
Plus £5.2bn

East Midlands
Plus £6.5bn

Yorkshire and the Humber
Plus £3.8bn

Scotland
Plus £6.2bn

Wales
Minus £2.8bn

North East
Plus £2.5bn

Northern Ireland
Plus £4.6bn

Interesting @DrySherry

Does seem to be a pronounced North/South divide.

It's not unusual. By sheer luck alone, we sold up in late 1988 in the SE and moved to new jobs in Scotland. Three years later we moved back to find utter chaos in the housing market. Prices down as much as 50%.

We lost money on our first 2 properties in the South East but then the 3rd one doubled in value in about 5 years! Was just lucky of course - 3rd time lucky!

ONS today

Aha! This is why I think that the BBC have not been reporting the data. I think that the ONS have told them that it is no good. I see that the ONS are reporting the next release as : Discontinued.

BBC has two reports on Indonesia, but nothing on house prices. I'm confident that if I polled a few people in the high street, 80% would say that house prices were more relevant to them than Indonesia.

Unfortunately, the BBC and the rest if the mainstream media are pretty rubbish nowadays. Heavy political and other influences. It would be lovely to see some proper investigative journalism and dissection of the headlines and number but that's very unusual in the mainstream.

Think that’s a safe bet @XVGN

Thanks. We do pay for the BBC and they are supposed to be a public service. However, we have to look to real news organisations in order to find a report. At least two months in a row now that Reuters have a report but BBC do not.

Ok. To be fair to the BBC. They did bury a report in their live feed on inflation. But poor old Kevin cannot bring himself to report the 4.8% decrease for London. I wonder if he lives there?

'We do pay for the BBC and they are supposed to be a public service.'
I agree with you @XVGN
I think they are deliberately being very vanilla (being kind here!). I know their funding has been a real concern for some years and even more so v recently.