Thursday 2 October 2008
Fionnuala has a go at spinning the dreadful house price numbers.
And of course, she fails miserably.
My favourite comment was the one about the pace of decline stablising. I think she means that we've had a couple of months where house prices fell by 1 percent a month. Keep it coming Fionnuala; that kind of monthly price decline will be just fine by me.
She also thinks that the US housing bailout will help here in the UK; which will stabilise credit markets here in the UK. This is an implicit admission that housing inflation needs credit growth. Where is all that previous guff about demand pressures?
Old habits die hard, she finishes off by saying housing prices are higher by "60 percent in real terms."
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6 comments:
The good lady F. does not understand the significance of the real house prices graph that her own building society generates on its webpages:
http://www.housepricecrash.co.uk/indices-nationwide-national-inflation.php
- or the better (longer) one on the header of this blog. Just look at the graph, Fionnuala: it's visually obvious what will happen now!
If the rise is 60% since 2000, after several years of riseing out of the last trough, then all or very nearly all that 60% 'real' rise this decade will come off again; and if inflation is so bad that this means only a 25% real price drop peak to trough, don't keep all your money in cash!
B. in C.
don keep alla your moneh anywhere...
innit...?
Alice,
The falls, horrendous though they are, are far worse than the Nationwide figures suggest.
The 12.4% annual fall includes last October when prices were still rising. The 11 month figure is 13.03%, whilst the figure for the last six months is 9.39%. In other words the rate of decline is actually increasing. So, we’re probably going to be looking at a fall of 15% for the year 2008. Of course, that doesn’t include inflation, so the real fall will be close on 20%. And all this before the credit crunch takes its inevitable toll on the employment market. In other words 2009 will be a least as dire (or wonderful) as 2008.
I wouldn’t be surprised if we see a peak to trough fall of 50-60% in real terms, followed by years of nervous stagnation. It looks like you won’t be a bitter renter indefinitely and my kids will get a play room and a bigger garden.
Here is the link to the raw Nationwide data:
http://www.nationwide.co.uk/hpi/downloads/Monthly.xls
Young Mark
I have some other uses for Fionnuala's mouth than spouting this propaganda. If she is going to whore for money, at least do something more fun than juicing the housing sector.
What Young Mark says.
Old Mark.
What Both Marks say.
Nick
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