London agent Eric Walker is continuing his crusade against the ‘meaningless averages’ quoted in various house prices indices.
The boss of Bushells attacks the media for reporting the slightest negative titbit in what he says is its decade-long mission to prove the housing market is collapsing. He points out that his own firm has had a great start to the New Year.
He also says it is ridiculous to suppose that house prices in east London, in the run-up to the Olympics next year, will actually fall.
As for December’s figures? Well, there was a thing called snow.
Meanwhile, today's Halifax index says that house prices fell in December by 1.3% compared with November, to reach a national average of £162,435 an annual drop of 1.6%. The Halifax also reported on home-owners' growing reluctant to sell.
Does anyone disagree with his comments, which can be found here:
www.bushells.com/newsarticles.php?id=16039
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Comments
Chuckles quietly !!!!!
Predatory? Never! Informed? Dangerously!
Blimey, Wednesday is a horridly slow telly night.
Kids went off at 8 and since then Mrs Jonnie has been watching the episodes on Plus of that dreadful ‘One Born Every Minute’ on C4 where fat northern birds heave out a Chavvy on telly………………………………so to be clear, that’s why im here now at half eleven.
Now, there is lots of the normal stuff on here from John Smith who I think is struggling to work out the time of posts (look again mate, you sounded like a berk on your last post) to Gourmand Gossip swerving wonderfully between predatory poof and informed commentator.
But, the point remains the main feature; we are now in the ‘age of the local index’ – any ideas that the one size fits all reports are worth basing choices on are misguided.
Base your choice / decisions on what’s happening locally – you will be happier and better informed…………..don’t fall for that ‘North / South Divide’ thing either, its not true, ask an agent in Manchester City centre how its going and you will get a different answer from one dealing detached houses in Wimslow
Jonnie
Jonnie 2, and elaine, 90% moretgages are the new 100% mortgages, being that mortgage companys think that 10% falls can come, and ive read that the 90% are being scaled down, and replaced with the new ones you speak about, amazes me how much time estate agent have to surf the web in business hour, but rarely comment after work.
Actually it was central Government who for a brief period suggested property as an alternative form of pension provision, via sips. The real issue of over pricing exists in one place and one place only London and the home counties.
I am a pauper from the country 1800 sqft of detached accommodation and no mortgage. I can walk the dog on the beach and leave my car on the drive overnight unlocked. I am working in cental london right now courtesy of a 8mb internet connection yet I am 220 miles away. If you can afford to live in london, good luck to you, if you Want to live in London and can't afford to tough! If you Need to live in London I feel for you, that is were my social concience lies. All the yuppy sorts can do what I have had to do for years, 45 minute drive plus 2 hrs 30 on the train to get in, 3hours on the train, 45 minute drive home.
The wages might be beeter in London but they sure as heck ain't 3 times what they are here. Unlike property prices.
One of the basic tenets of a civilised society has to be that of housing its citizens. It's number one alongside food and warmth.
Sometime back, maybe 15 years ago, we all lost sight of this fact. For many, houses became an investment opportunity or an alternative to a pension. This, in hindsight, was foolish.
It`s never ceases to amaze me how many commentators here think that the best remedy for the hangover from a credit bubble is easier credit . It is shocking that 43% of all mortgage stock in the UK is interest-only and 75% of mortgages advanced between 2005 and 2010 have no specified repayment strategy, even more alarmingly is the fact that 65% of all private sector rental income comes from housing benefit, the rental market is anything but a free market, surviving on taxpayer support.
There are high costs for everyone if idiots leverage up on unaffordable loans. House prices are pushed artificially high, families cannot get the accommodation they need, too many resources are sucked in to industries like estate agenting and mortgage finance and finally there is a bust and everyone suffers. So a rising cost of living is good news because it stops the cost of living falling?
So today's youngsters just need to couple up, get decent jobs, pay off that credit card debt and the student loans while also renting somewhere, then save up £25k (better put those hols plans on hold and live in a shared rat's nest in Hackney for 5 years) or so to get a mortgage at staggering (in mortgage terms) profit levels to the bank and then they too can own a 1-bedroom ex-council flat with no outside space in zone three, 25 mins' walk to the nearest tube station. And trading up to a family home should be a doddle as long as both of them treble their salaries in under 5 years, both stay in work, and pay down their slavebox mortgage like the clappers.
If you are a bit slow, the country is already in real trouble and has been since the tech boom ended, youve just been masking it for a decade with unpayable debt and leveraged fraud, youd be better of preparing for an inevitable social and fiscal regression of unprecedented proportions, than trying to impossibly impoverish the next 3 generations of kids so that youre alright.
Socially regressive times? Surely not.
Sorry Jonnie, That Hotel Girl thingy was all my fault, fell asleep after the event if you know what I mean, she elped herself to my new ipad. She earns a fortune but its all cash in hand. Loadsa money but she hasn't come up with a reasonable explanation for the folk at Money Laundering or her Old Nan so a tad envious of us folk with property.
I ave to say that all that pent up anger means the pre event thrashing is mighty fine, best in London.
JOHN SMITH.
Yes the BOE base rate is 0.5% which as we all know is artificially low – 5/6% is the likely long tern future average so some of the current products in the market will, in the longer term, be quite reasonable.
The fact that 90% products are re emerging is as much an indication of the lenders view of property prices in 2011 as it is a welcome addition to the growing number of mortgage products already available
Oh it’s good to see an article getting a proper debate / barny going.
Not sure who this Jonny is? But no matter, it great to see the old faces, Ace / Wardy / PeeBee and Goumand wotsit is back – less homosexual innuendo than usual but bringing some good stuff to the conversation.
The we’ve got the usual smattering of HPC nutjobs shouting a lot but brining nothing to the party – hotelgirl - well done with the post, well informed and with some very interesting points that will stimulate much debate………………thick bint
Anyway – the point is this article is right, if you want to buy then don’t look at national surveys, look at the area you want to live in, im told that land registry can help with this.
If you are convinced that prices have another 50% (they always say 50 don’t they, after Nationwide say prices fell 1.5% or what ever they never subtract that bit, they just keep saying 50%??) then good luck, keep waiting, you could even get a forum web site and flick your selves silly over 0.01% drops on the national surveys while paying landlords rent / living with your Mum.
Jonnie
An estate agent talking up the market. We (the U.K.) really need to quarterize London. It's a Cancerous Leach responsible for all our finacial woes.
Jonnie, yes a lot of 90% mortgages are avalible but only a twit would sign upto one that have an 6-7% interest rate when the base rate is 0.5% LOL i gues they saw you coming DOH !
John Smith.
..........................erm, saw my mortgage broker earlier - 5 new 90% mortgage products have come to the market this week, now as im writting this on Tuesday night thats not a lot of week passed.
Get another mortgage broker my old mate
Jonnie
i look forward to seeing every estate agent and BTL speculator go out of business. A nice side effect will be cheaper houses, which would be convenient.
Oh my God! I'm so worried that houses might get cheaper. Will somebody please do something??? Quickly, before it's too late!
I don't need an EA to tell me what's going on. I read the official reports and can see how sick the market is. Snow, I ask you? It might effect viewings, but how does that effect price?
All the gimmicks have run out of steam, and even with next-to-no BoE rates, prices are falling. Mortgage rates are back to where they were when we had BoE rates of 5%. Someone's making money.
The plates have a severe wobble and are about to fall off.
The Chinese might be queuing in London, but not in the other 90% of the UK.
And when interest rates climb back to the norm, find another job.
I'm sticking to my prediction of 50% off peak prices, and realistically, we're half way there already.
The bonus being to Barclay's Bank UK investment team is equivalent to roughly 153,658 25%deposits on the average house.
That is the start of Over 150,000 purchase chains.
Thank you, Mr Shapps get you collective thick heads around the employment potential of that sort of stimulus into the house selling and building industry.
I appreciate the 25,000 of you chums will have a truly spiffing time with their fat wads, but an average bonus of over £250,00 each is simply wrong.
One Banker is getting a £9,000,000 just for himself.
you guys just dont get it, the banks have tightened up lending to 3.5 x salery, and a hefty 25% deposit, untill the average house price falls back into line, prices are just going to keep falling, the market needs first time buyers to run properly, looks like no zonda, maybe a honda instead,
i wouldn't listen to the housepricecrash.com lot, they have been wrong all along. You'd think they would have given up by now and admitted defeat.... but oh no, thats how stupid they really are.
Disbelief - happy to allay your confusion. Here 'Oop North' we also say 'Kettle calling the frying pan..."
However, I do appreciate your inclusion of a classic Meat Loaf track into your response! ;0)
Fair point PeeBee. Guilty as charged.
As for filling in the blanks - do you mean 'Pot calling the kettle black' or out of the frying pan into the fire'?
Its confusing ;)
Disbelief: you say to wardy "...Perhaps if you were to stop hiding behind a nom de plume...".
Sorry? ...kettle ....frying pan - YOU fill in the blanks!
Wardy - I cant believe I am defending a competitor, but he may has had his opinion published before - but maybe that is because he has one.
Have you written and submitted any articles or observations? Or do you prefer to throw stones at those who do? Its a good article and I agree with it. Perhaps if you were to stop hiding behind a nom de plume and disclose your company, we could have a read of your views.
Having worked in the press for years, I can tell Mr Walker that the young Johnies talking the prices down are the same malcontents who drift down here from House Crash Price. con. Spivvy little oiks who blow their cash on Levi 507's, bottled import lager and anything trendy rom Apple.
Open the 1962 Haig Special reserve and sit back and sell houses to the billionaires that land with every flight from China.
Because Dave, this is not the first time that EAT have teamed up with Eric for his opinion/self publicising, are you suggesting he knew nothing of this article?
I’m sure your patting yourself on the back and admiring your sarcasm and wit as we speak. Anything constructive to say?
Anyway ive made my point, im sure you will continue to pick at it dave.
good evening all.
Having now read Eric's blog entry thoroughly I would have to say that, despite the little faux pas I mentioned a wee while ago, it is yet another well-written and seemingly honest reading of the market. Yes - it is London - but he goes to lengths to point that out and that he doesn't profess to know what is happening elsewhere (but you can bet your a$$ that he does...) - but mores to the point he is simply reassuring those who read that whatever the press try to say, there is nowhere near the doom and gloom that is portrayed.
Since WHEN has being positive in the face of mass adversity been a criminal offence? Eric - I'm with you a million percent - and if your staff are as upbeat as you are, I'd instruct you to sell!
To add a frivolous comment (wouldn't be me otherwise, would it... ;0P): Eric is quoted in his blog as saying "...December was particularly difficult as Christmas fell on dates which resulted a longer than usual break."
Now obviously I don't know about you lot 'dahn Sarf' - but here Oop North Christmas has a strange habit of falling on the 25th December EVERY year - it's kind of tradition... ;0)
"blatant self publicising of Bushells blog masquerading as a news article"
How can you self publish on someone else's site?
Do tell. It would be a great trick to learn.
I disagreed with the blatant self publicising of Bushells blog masquerading as a news article. Not whether London is doing better. As for having a pop at the media, maybe if the news readers popped the word ‘except london’ after everything they say then maybe you lot in the city would feel better. Truth is, if property was falling of the shelves like you say it is then you wouldn’t give a stuff what the media says.
Why have a go at someone who has an opinion based upon their experience and expresses it? We are busy - very busy and dont recognise the press reports as being accurate. We are recruiting, but decent staff are hard to find and generally have high expectations underpinned by demand from companies competing to employ them.
Wardy - we have a shortage of stock and quite a few properties attract competitive bids. Some agents - even larger ones, are offering around 1% fees to get instructions. If you have high stock and low transaction levels, then you are agreeing with the articles point that national figures have no bearing on local markets.
Lack of new build is not about demand. Its about land banks where owners paid too much for the land and cant the the funding to build out yet cant afford to sell, further compounded by the social housing requirements.
I would say it has already kicked in? High levels of stock vs low level of transactions, despite a shortage in new builds. Is the lack of new homes not a result of low demand then?
Ray: excellent question, and one which never fails to perplex me.
Likewise, there is a national shortage of homes yet there are hundreds of thousands for sale; and many many thousands empty (and in many cases going to wrack and ruin). How is that?
Answers on a postcard, please...
Sorry Ray I was answering Dave@Cw, re wardy and co.
To quote Henry Pryor "...but since agency is a turnover based business Eric and others would be better off trying to get higher volumes and leave values out of it."
This is a very slanted (and in my opinion totally wrong...) view - and typical of the 'numbers game' mentality which has poisoned the industry.
Because Fee levels have been pushed down; because so many offer fixed-fee deals, there is little or no point to achieving best value for THE CLIENT any more. Sell by hook or by crook is, and will ALWAYS be, at the expense of the owner. It should NOT be solely about volumes of transactions - it is about achieving a Fee level which allows profitable operation at current transaction levels.
Doubtless thare are many who will disagree - I look forward to reading your reasonings...
Wardy.
How about answering the question?
ha ha, please tell me you didnt look it up!
"Supply of new homes set for further falls - Monday 10th January 2011...............Currently the country has a housing shortfall estimated to be a million homes, and last year the number of new homes built was the lowest since 1923......."
How long before supply & demand kicks in and affects property prices?.
You convinced me Wardy - wait - no phone number, no agent of that name. The Zonda may have to wait.
Ok here it goes, I will try and do it in a style you like.
Wardy Blog.
The housing market isn’t great at the moment, transactions are low and much of the stock is over priced. However every thing at Wardy and Co is absolutely fine, we are selling loads and I have just ordered a Pagani Zonda. We seem to be bucking the trend and national house prices are of no concern to me. Please instruct me to sell your home.
How was that?
Hey Wardy - here's and idea. Why don't YOU write an article and put us all straight on what is happening. At least Henry has the good grace to put his name to his comments and offer an alternative view.
Personally, I agree in part with Eric and also with Henry - but it only from reading various viewpoints, combining my own observations that I am able to offer my clients informed opinions.
One thing I do agree with - the bloody snow screwed everyone up!
He's updated HIS blog with this article. He states they have had a good start to the year, but than expected.
With his comments towards the negative press, he is spot on. Something the majority of posters on here have always had something to say about.
What IS the problem here? EAT have reported this on THEIR own site.
Get back on track and focus all your efforts in house rather than have a pointless moan.
In fairness - a vendor referred me only today to the BBC article "UK house prices fell 1.3% in December, Halifax says"
NO mention of transaction levels. Nothing on BBC London site.
As such, I think Bushells make a valid point in the context of replying to press comment.
It may be an advert for them - but so what?
Yes I do write editorials, but I don’t pretend they are something they are not.
This is an industry site read by agents all over the country many of who are bracing themselves for a hard year. If you agree that the article was a bit of self publicity then perhaps you’ll agree that this is not the best place for it.
STOP PRESS: Shock Horror - agent writes positive article which generates web traffic.
Just like Chestertons, Rightmove, Zoopla, Foxtons, Savills, Knight Frank and everyone who gets mentioned on these pages and in the press.
Wardy - No. Not a contradiction rather than illustration that transaction levels can influence prices in either direction and therefore dont help in deducing what is happening to prices. I think in fairness most agents have some sort of PR drive which is seldom intended to do anything other than promote a company. Dont you ever write editorial for local press? I do.
Its not as self serving as chestertons article announcing a freeze on VAT which is effectively and advert!!
Jean,
You have managed to contradict yourself in the space of 5 sentences. First you say transactions are not linked to house prices, then go on to give an example? The thing is, it really is that simple. Supply and demand is not a difficult thing to get your head around. This blog/article is nothing more than Mr Walker saying to potential clients that all is well at Bushells.
Wardy - as with all blogs perhaps - are you suggesting they should all be anonymous? Do you think Eric has control over what EAT publish?
I agree transactions are a useful measure - but linked to house prices? NO
Low transaction levels can be a result of a lack of properties which can cause prices to rise.
They could be as a result of a lack of buyers - which can cause them to fall.
Its not as simple as you think!
Henry - after your coma inducing blog which seemed devoid of any conclusion -I fail to see what your issue is with a London agent commenting on London market as he sees it. Right or wrong - its an opinion and perhaps a point of discussion.
Eric 'head in the sand' Walker.
Keeping his head while all around him are losing theirs.
If I’m not mistaken house prices have a direct relation with volume and as Mr Prior points out, volume is low be it London or anywhere else.
Unfortunatly the idea behind this 'article' is to drive trafic to Walkers Blog. Which it has.
Well, I am sure it is a good article but frankly I dont give a stuff about prices in London any more that Londoners care about Manchester. If the national stats are right, how come they never seem to agree?
seems like he has got it spot on. Maybe it is good advertising - fair play - but at least its an opinion.
If I wrote an article about prices in my area - I wouldnt get another instruction - ever!! If I some good news I would do the same.
We are in London and I absolute agree with Eric. He has responded to reports in the press about House Prices - not volume.
And as for BBC London - try finding comment.
In my experience, our vendors dont give a fig about anything else other than their local prices, but their opinion is formed from the national reports so broadly agree with his opinions.
Ahem - "as Henry Pryor rightly points out, the national picture is very different to the London market. "
What? The whole point of the article was to make the point that London is different!!!
Why is Henry getting the credit!!
This nothing more than blatant advertising for Eric Walker and his firm. "He points out that his own firm has had a great start to the New Year."
Well good for him, but as Henry Pryor rightly points out, the national picture is very different to the London market.
Sadly the Land Registry numbers don't back up Mr Walker with sale volumes in London at 7,700 (Sept) where they were in 2009 and below the average of 9,000 per month. In Aug 2007 the number of sales in London was over 14,000
No one wants to instruct a depressed selling agent so most will see the glass as half full but since agency is a turnover based business Eric and others would be better off trying to get higher volumes and leave values out of it.
London is certainly bucking the trend elsewhere in the UK so if you want a local snap shot watch BBC London but the main national picture is more complicated and not as rosy as London centric agents might wish or indeed be experiencing.