House prices dipped last month but activity in the housing market edged up as sellers got realistic over house prices, the RICS claimed in its latest survey.
Although still at historically depressed levels, the RICS said a ‘rebound’ in sales and buyer interest gave the survey its best reading since April 2010.
The RICS reported that the only place where house prices rose last month was London.
Completed sales rose slightly, to reach an average of 15 per surveyor (by branch) over the past three months.
However, respondents note that if buyers are able to access finance, banks are taking a long time to agree lending terms, which is slowing down the purchase process.
Brian Jackson, of Ellis & Sons, in Southport, Merseyside, said: “The number of proceedable purchases has declined to such a level that vendors are taking drastic reductions off the asking price by accepting low offers to achieve a sale.”
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Comments
"The UK govt has made it clear that there will be no more bailouts for British banks,"
What they say and what they do are very different things.
The UK government and most others have made it clear they will always bail out the banks...there will be more QE and bailouts before an interest rate increase.
rant - If it's a case of 'rain stops play', then don't look up to the rain with your mouth open unless you want a gob full!!
I sincerely hope that we can arrange a rematch soon on those points, matey! Let's not wait for the world to sort out its' economic crises - we won't live that long!
Anyway - to your final point - you have omitted a vital fact (not like you at all... ;o) )
I said POTENTIALLY more sales.
I'm sure there are plenty of Agents who would STILL love to see my head on a pike, though... ;o)
Oi!
Rant – not sure about heresy, I have always said lower prices are good for volumes, id have 1992 back any day, loads of choice for everyone, easy to build chains, the competition doesn’t panic and cut its own throat on fees just to get an instruction (fees are always much higher when there is loads about, as much as double) and we all make more money.
……………………Other things I like about 1992 are I was skinny, young, had floppy dark hair, a soft top XR3i (in the light metallic blue – cool colour) and slept with lots of different women, shared a nice flat with a likeminded mate, smoked Marlborough Red by the 20 and never seemed to get hangovers or have any sense of my own mortality and Greece was a place you went on lads holidays to, not an economy you worry yourself about.
Now im old, fat, grey, fast Fords are for chavs and don’t snap knicker elastic if you dump it outside a bar and drink larger with a lime stuffed in the top (which makes you look a tosser nowadays) and cant I get out of bed before 10am if ive had a skin full, I now live in a road full of respectable people that never have a party just for the hell of it and gave up the fags as im worried about dying and leaving my children as orphans and these days only gays and women look good in a soft top and I find a diesel makes much more sense anyway…………….
Apart from the above factors I don’t miss 1993 at all!!
Jonnie
@rantnrave
I agree with you on your one point point this time (cripes!) - Land Registry is the only stat. worth a light.
The impact of the Eurozone crisis on mortgage rates is now getting mainstream media coverage:
BBC: Eurozone crisis may affect mortgages, brokers say
http://www.bbc.co.uk/news/business-15677498
The game had to be abandoned Pee Bee. Turns out that the Greek and Italian sponsors didn't actually have any money.
Did your post say that reductions in house prices potentially lead to more sales? That's borderline heresy on this site... Nobody will pick you up on it though because you're not a HPCer.
rant: "In reference to Ray's point, the same sampling size issue could be applied to lots of the indices. Nationwide and Halifax take data from their respective 12% and 5% share of the UK's dwindling mortgage market to calculate their house price indices."
Ray will no doubt provide his own response - but for my two penn'orth...
Nationwide's "12%" would equate to what - 70-odd thousand properties per annum? Halifax at around 30k? Then look at the RICS. Average 400 branches selling 5 properties per month, give or take. That would be 24,000 completed sales if you (...they...) were exceedingly lucky!
Puts them way behind in my eyes, of the other indices (and you know how little weight I credit those with anyway... ;o) ) - and don't forget they actually have a vested interest in prices REDUCING - potentially more sales; easier to get - and less PII exposure when they come to do RICS valuations...
By the way - do I take your lack of response as conceding the last round to me over the Welsh market?
Or is it a case of 'new balls, please'? ;o)
The HPC lot yesterday were discussing the impact of Italy's bonds passing the 7% interest rate mark (aka, 'the point of no return'). The UK bank with the greatest exposure to Italian debt is Lloyds, which also happens to be one of the biggest lenders in this country's mortgage market.
The UK govt has made it clear that there will be no more bailouts for British banks, so if Lloyds is to take significant losses, then it may well look to increasing rates to existing mortagage holders to cover those. Mortgage rationing (especially when compared to the silly levels of the last decade) from Lloyds and other lenders will be a reality for the foreseeable future too.
The CML report out today records a slight uptick in the number of repossessions over the last quarter. Also contained in their analysis is the figure of 27,300 mortgages that are currently over 10% behind on repayments. If UK banks are to take hit with Eurozone defaults (as now appears inevitable), then the forbearance they are clearly showing at the moment may well come to an end as well.
In reference to Ray's point, the same sampling size issue could be applied to lots of the indices. Nationwide and Halifax take data from their respective 12% and 5% share of the UK's dwindling mortgage market to calculate their house price indices. The Land Reg is a significant exception here.
Peebee - Nice post and I agree with much of it again this is getting very worrying. My only gripe is your quote "prices will go where the market will take them"...errrr yep :0)
So I'll add my prediction...I believe there will be a long long slow fall in prices. This is due to ecomomic pressures (upward and downward) supply and demand is not the only equation!
Only a sizeable shift in these factors will force the market one way or another
Prices will increase steadily if we see a return to irresponsible lending by the banks...unlikely
Prices will reduce quicker if Interest rates rise rapidly - again unlikely
As far as I can see this is not a receipe for high volume
Over to you Brian.......
Brum agent: whilst I agree with you that Brian has gone all militant, and that SOME HPC posters (rant and Sibley's to name the first that spring to mind...) offer better craic AND reasoned debate material than many who apparently make a living from the property industry, I find it slightly perverse that you then ask Brian to table his own thoughts yet offer nothing yourself!
Perhaps one needs to grow a pair oneself before telling another exactly that...?
My opinion? Prices will go where the market takes them. Agents cannot control the market (and should not try, in my opinion...) - they simply work within it and their goal should be to produce the best result possible for the fee payer. If the customer-specified result is a quick sale at the expense of value achieved, then so be it (except in the case of repossessions when this despicable practice continues despite government intervention in the 1990s...). If, however, the vendor's wish is to maximise the value of their property then the Agent has to work to do so - or refuse the instruction.
Agents work to targets; budgets; cashflow. Vendors don't give a shizzle about these factors - and neither should they.
They should also not be put in a position where they are undersold in order that an Agent can achieve these KRAs.
Do YOU want property values to nosedive? If yes... why?
Brian, you clearly find it easier to make ad hominem attacks on the HPC crowd than actually engage with their arguments.
If you think prices are going to rise, or at least hold their present level have the balls to say so, and then explain to us why.
Ray- I said the HPC pillocks were at school, see the time of rants first twaddle post! Seems he is on his Playstation.
rant: Diving? ME? You gotta be joking, bud!!
Okay - here's yer ball back right atcha, with a backspin so vicious it'll save you even having to return the shot...
You say new vendor instructions are up 30% month on month in the Welsh region. Okay - that's what the survey says - however, the number of properties HAS NOT INCREASED a jot (in fact it looks like it has dropped a point or two...). Please explain that little poser.
Oh - and on the same point, you do not mention that the same indicator was DOWN some 22% last month - so maybe it is just a blip; maybe someone muffed up their figures - and maybe it just goes up and down faster than Frankie Coccozza's undercrackers... ;o)
You ALSO fail to mention that new buyer enquiries have risen by over ten percentage points (whatever THAT means...!) in the last month, which is surely a sign of activity.
115 properties on average on the books is not an enormous or surprising number, rant to anyone who works or has worked in the industry. If you consider that, say, 20% will be under offer at any one time, roughly the same percentage will be multi listings, then it doesn't leave a lot to work with.
I concede that Welsh surveyors appear woefully inept at talking up the market (something to do with them being Welsh, I expect - take 'Bob' who posts on this site as proof of that particular pudding...) however, to quote a couple of the surveyors' comments within the report:
"Prices of most types of properties, holding their own."
"Market seems remarkably resilient given the state of
the global economy. Expected slow down in activity now occurring but sales are keeping up well and pipelines still 15% above this time last year."
Obviously English lads working the patch... ;o)
Just how representative are the RICS figures - as far as residential sales go?
What percentage of TOTAL sales in the UK market do the RICS controlled agents achieve?
Not the majority methinks?
...diving to the side, making a forehand volley in return...
Did you see page 5 Pee Bee? 115ish properties on average on the books in Wales with new vendor instructions up 30% in the last month and price falls already being reported...
In last week's discussion of all the bodies representing the property industry, RICS seemed to come off better than others.
...Pee Bee sent scurrying to the left, looking unlikely to reach the ball in time...
rant: Looking at Wales as you suggest, 2% of surveyors say that prices have risen by tuppence; 28% say they haven't moved at all; 44% say they've dropped by tuppence; 23% say the drop is nearer sixpence; and the rest say nearly two bob. From what I can see, sixteen surveyors commented - appearing to represent seventeen Agency branches.
SO - for a laugh I picked one of the survey respondents purely at random - David W Pearse & Co.
In business since 1976, apparently. Never heard of them before - and therefore a good one to choose so as to have no bias whatsoever.
Erm... BAD CHOICE, apparently. A search on their website brings up NOT ONE residential property for sale! They've apparently got an office to sell, though...
Yet, they fill in this survey, based upon RESIDENTIAL SALES!! WTF??? is, I believe, the correct phrase in the circumstances...
Mr Pearse also has a paragraph of his comments printed - talking about the market "bumping along the bottom". How he knows almost beggars belief.
A true representation of the market? Methinks not.
Over to you, matey! ;o)
That was a good spot PeeBee - it wasn't taken from the original RICS report though.
If you dig that report out, if London is skewing the figures one way, Wales is looking pretty precarious in the other direction.
http://www.rics.org/site/download_feed.aspx?fileID=10775&fileExtension=PDF
Hmmm...
According to the report, "In the three months to October, the headline number of sales climbed to 15 which, while still very low from a historical perspective, is actually the highest number since April. Compared to September, this represents a 2.2% rise." Now here's the thing. September's report stated 14.5 properties per surveyor (branch). In MY reckoning, that equates to a 3.5% increase. Anyone else care to do the math? I'd hate to cast false aspersions that surveyors cannot add up, subtract, or work out comparables - I mean percentages (sorry, Freudian slip there... ;o) )!!
Back to the report, "...it is significant that more than half of respondents actually indicated that prices were broadly stable over the period and of those reporting a decline, almost three quarters suggested that the extent of the fall was between 0 and 2%." In percentage tems, then: 4.75% of those that could give a chuff reported a rise - of which six out of ten of those were based in the capital; 52.3% reported no change; and 42.9% reported falls - over 30% were decreases ranging from tuppence to a measly few grand. All in all, then, OVER 57% of respondents say that prices are NOT falling, and another 32% say they're shedding less pounds than Craig on the X Factor!
Oh - thanks for acknowledging the glaring error in the original report, by the way. Those in the property industry have a hard enough job as it is!
Ray you visit this site enough to know the HPC pillocks are still at school at this time of day, looneys will post soon enough..................
Are they taking cash sales, where the buyer doesnt have a survey into account? Or ones where the stupid surveyor makes claims, later proved to be false, that threatens the sale?
"Completed sales rose slightly, to reach an average of 15 per surveyor (by branch) over the past three months – a rate of less than one house sale per branch per week."
So - we had two five week months and a six-weeker, did we?
Sloppy. VERY sloppy. But the HPC crowd will still use the statistic, no doubt...
Vendors should not be 'guided' SOLELY by auctioneer valuers or estate agents (remember they have a vested interest in a quick sale - this does not sit easily with the view of many on this site who keep on about 'over' valueing)
There is plenty of info. out there nowadays to enable vendors to use their 'noddle' about reserve or asking prices, whatever 'advice' they receive.. They should do so - if they want to sell and can actually afford to sell at this time, because many cannot because outstanding mortgages would not be cleared. If not - stick!
Bingo! The penny begins to drop. Transaction levels increase as prices fall. Sadly most agents still too dense to realise.
Is anyone surprised that activity goes up as price comes down?
It is basic economics, not news.
I just wish more home owners understood that it is price that prevents them selling so they wouldn't listen to agents when they over value to win instructions.
It is good that sellers are dropping prices instead of blaming 'the market' for being slow.
All you 'house price crash' people are a bit late up today! ;>)