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House prices continue to slide

I promise that I had no idea about this story yesterday, when I wrote my previous post about why the recent increases in house prices were based on very low volume and would not last very long at all. As if by magic, today we see a report from leading property website, Rightmove, which claims that average asking prices dropped by 2.2% between July and August. Obviously, you have to take this stuff with a pinch of salt since it’s only based on the asking prices of properties advertised on the website, but it’s still an interesting indicator – if things were really improving, seller confidence and asking prices would be climbing. The bottom line is that unemployment...

posted on: Aug 17, 2009 | author: Lance

It was all just a bad dream

So, that was it. The worst recession in living memory is, if you believe the latest government think tank reports, now over. The recession that Alistair Darling said would be the worst for 60 years (and he recently revised that estimate upwards to 100 years) has passed with nary a whimper in real terms. True, if you lost your job in the last year or so then you might not see it as being a particularly benign period of history, but really, as these things go, this has been ‘recession lite’, a recession for the generation that doesn’t dorecessions. Which, of course, makes me and Lance look a bit silly. Having correctly predicted that the recession would actually...

posted on: Jun 10, 2009 | author: Alex

Basic guide to Quantitative Easing

This is an article that I could have written a few months ago, when the Bank of England stated its intention to begin ‘queasing’. But it has become rather more relevant now that one of the pronouncements of the G20 summit is that the International Monetary Fund (IMF) will itself begin to ‘print’ additional SDRs (Special Drawing Rights, effectively the IMF’s own currency) which its contributor countries can draw down in the shape of dollars, euros, etc. Note my use of the word ‘print’ in the above paragraph. The days when first world countries used the printing press to increase the volume of money in circulation have long gone, assigned to eras such as Weimar Germany. Paper and...

posted on: Apr 4, 2009 | author: Alex

Mortgage approvals rise for third month, we’re saved!...

According to the British Bankers Association, the number of mortgages approved by major banks rose in February for the third consecutive month. Happy days are here again! Not quite, despite the rise, mortgages approvals are still close to historic lows and down over 30% on the same period for last year, so we’re not out of the woods yet. Low interest rates and falling property prices may have tempted some cash-rich bargain hunters back into the market to buy houses at what they believe to be once-in-a-lifetime knock-down prices, but the bulk of the market is still frozen solid. Most importantly of all, first time buyer mortgages are still extremely hard to get hold of, and as everybody...

posted on: Mar 24, 2009 | author: Lance

Housing market going to hell in a handcart...

The UK property market remains in freefall, with figures from Righmove.com showing the average price of a home in England and Wales has fallen by a shade under 5% over the past twelve months (although Halifax and Nationwide put that figure at 12%). According to the Council of Mortgage Lenders, UK mortgage lending has dropped a massive 42% over the previous year, which explians why prices are dropping – people simply can’t borrow enough money to keep prices at their current over-inflated level. The fact that the market is clearly screwed for the forseeable hasn’t quite penetrated the skulls of many homeowners, as this story from the Times reports, asking prices in some areas are actually rising, even...

posted on: Oct 20, 2008 | author: Lance

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