"Crowley" wrote
You are saying that now with hindsight. Many people thought that 2000 was the top of the cycle, at the time.
So - this time (2005), do you have a crystal ball telling you that it *is* the top?
And many people (me included ) didn't.
Sigh
"Crowley" wrote
So - repos have been low in 1984 (at the start of a boom), in 1989 (at the start of a slump) and in 2005 (now).
What does that tell us about house prices from here -- ah yes, it says that they might go up or they might go down. Wow, what insight!!
1984...end of a recession/start of a boom 2005...end of a boom/start of a slowdown/recession
Spot the difference ?
Sigh
Repo figures are just one indicator amongst many, most of the others have been mentioned on this thread and point to a housing market at the top of the cycle.
BTW if you really think house prices "might go up" then I suspect you are in a minority of one. Even the Nationwide one of the biggest VI's in the business in a report out last week predicted house prices would fall next year.
Still. What do they know ?
It seems to me that we're at the peak of a two-generational credit cycle (previous peak 1929) and that 1989 was the primary recession of the K-cycle and we're now headed into the secondary (deflationary) recession. It could be that housing cycles have coincided with the two K-peaks this time around but I suspect that this cycle will be driven by lack of availability of credit rather than normal swings in house prices.
I'd be interested in arguments that this is merely a house price cycle rather than a longer K-cycle.
FoFP
That will change in this cycle because unsexured lenders have learned of the advantages of attaching delinquent loans to property to gain a better chance of recovering their cash. Basically they can get orders such that when a property is sold (and it can't be sold without their permission if they get an order) then they get their cut after the mortgage is paid.
That could change things somewhat since it offers the possibility of loading credit card, car and store loans onto properties.
FoFP
You could be right it certainly looks like a credit crunch may be round the corner. What do you see as the other possible consequences for the UK economy and asset markets ?
Thats a good point. It looks like the escape routes for bad debtors are being cut off.
translation = 'no'
See some long threads here from years ago. Basically I'd expect a credit crunch and deflation with the consequences being worked out over a decade and a half and then a new stocks boom if the government leaves well alone. Chaos if they don't. More than likely we'll have a housing market more like the continental model thereafter rather than this manic trading and people will be leery of taking on debt for at least a generation. The odds are very high that the Magic Money Token on the
2060's and 2070's bubbles will not be houses.I'd still call for a 40% drop in real house prices, with whatever amount of deflation we get in a decade and a half added onto that for the drop in nominal prices.
FoFP
Do you speak English?
A lender is not usually going to "write off" the debt if the debt is secured on a property that they can sell to get their money.
And?
Only a tiny percentage of borrowers default on their mortgage and then refuse to negotiate with the lender, moron.
That's why the percentage of repossessions is low.
Good. I'm not wasting any more time on a clueless idiot like you. Bye bye.
*plonk*
who can? your referents are muddled....
very possibly... but lenders cannot make profit without lending money...
manufacturers cannot sell larger ticket items for cash to the relatively poor...
nor, currently, will the government tolerate crowded park benches...
there are various pressures which determine the behaviour of the participating actors
regards..
that was in a context of mainly hard currencies... it was in the context of a vastly less complex economy.... it was in the context of a vastly less wealthy planet ('west')
why on earth do you imagine the market behaviours are to be 'repeated'?
what is the use of repeating thoughtlessly 'the economy is cyclical' where is the sound evidence for that claim when real wealth has been climbing for decades?
i don't think you are coming close to making any sort of case.... and others (eg creepy and andypandy) attempting, have much less ability than yourself and are completely incapable of following the complexities....
i take the view that real current inflation in the uk is ~10%...that housing has approximately doubled in real terms since ww2 (imv because people are trying to use it as a hedge against gov't theft (inflation)
i don't think you can make a serious case that the housing market has topped out...(it may have....but imv you have no idea)
regards...
In message , Andy Pandy writes
On average, since 1996, 11.6% of the number in arrears where repossessed. If we look at those who are six months or more in arrears then the figure is 26%. This figure is somewhat misleading though because the stats are for whole years and do not relate a mortgage that is in arrears in one year that is repossessed in another.
In message , Tim writes
I make no such suggestion. In fact in 1984 it was the largest since 1969 (when the stats I have seen started).
In 1984 the percentage of all mortgages that were repossessed was
0.17%. Over the next five years it was 0.25%, 0.3%, 0.32%, 0.22%, 0.17%.Not me! If you had said the next 10 years then you would have got a different answer!
In message , Crowley writes
In fact it was an all time high!
Yes, the peak was 1991 (which would be the year the defaulters of 89/90 were repossessed.
My point was not so much about people who get into arrears, as I guess most will negotiate with the lender and work something out. Someone perhaps may lose their job and agree with the lender that they'll not pay/pay a lower amount for a while and roll up the mortgage until they get a new job. Or agree to wait the 9 months for ISMI to kick in.
My point was that someone who refuses to pay the mortgage payments demanded and then refuses to negotiate with the lender, ie simply says "I'm not paying", will usually get their house repossessed. Would you agree?
In message , Andy Pandy writes
I wasnt taking sides either way, I was merely showing the actual number of defaulters who lose their homes.
Yes.
In message , M Holmes writes
Dont hold your breath
"Crowley" wrote
Yes. But how did **low repos** at the time, indicate which way it was going to go?
No they are not! From past experience (see above), they are *not* an indicator of future house prices...
As house prices have previously gone either way when repos were low, then the fact that repos are low now does not indicate which way house prices will go!
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