House prices..

HangTime · 13 May 2008 at 22:59

Personally I think it is more a case of the dollar being weak in general, than the pound in particular being strong against it - take a look here and view how it has fared against the Euro, Yen etc over the past 12 months: http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/currency/12/13/twelve_month.stm

What this means is that even if we are importing in Dollars, it won't help us if the currency of the country of origin has strengthened against the Dollar also. IMO it is more important to look at the relative currency value between ourselves and the source than specifically against the Dollar, because even if we suddenly got 4 dollars for every pound, this wouldn't necessarily help matters in terms of good imported from elsewhere, if their currency also appreciated to the same extent relative to the dollar. In the modern day the currency markets are reasonably fluid and interlinked.

But regardless of the current status quo, lowering interest rates still further is likely to (slightly) devalue sterling. So compared to today, the cost of imports will rise, all else being equal.

Haircut · 13 May 2008 at 23:11

Dolph said:
Do we do most of our imports in US Dollars or Euros? The pound is strong against one and week against the other.

We have a trade surplus with the USA and a trade defecit with the Eurozone (as of 2007) so the pound being string against the dollar and weak against the Euro isn't doing us any favours at all from that point of view!

http://www.uktradeinfo.com/pagecontent/datapages/tables/EUAnn07.XLS

Dolph · 13 May 2008 at 23:12

Haircut said:
We have a trade surplus with the USA and a trade defecit with the Eurozone (as of 2007) so the pound being string against the dollar and weak against the Euro isn't doing us any favours at all from that point of view!

http://www.uktradeinfo.com/pagecontent/datapages/tables/EUAnn07.XLS

Fair enough then

I wasn't sure of the ratio.

clv101 · 21 May 2008 at 11:33

CML predicts 7% house price fall
http://news.bbc.co.uk/1/hi/business/7412091.stm

The Council of Mortgage Lenders (CML) has predicted a 7% drop in UK house prices during 2008.
...
The government's own advisers last week suggested that house prices would fall 5-10% in a briefing paper to Cabinet.

It seems the mainstream commentators are starting to recognise the situation we're facing.

Stinky · 21 May 2008 at 11:40

still all predictions!

brid · 21 May 2008 at 11:41

When the vested interests are quoting 7% falls its time to be worried ..... usually quoting the BEST CASE scenario (i.e. cloud cukoo statistics).

.... Just look to America for an idea of how its going to be here.

clv101 · 21 May 2008 at 11:46

brid said:
When the vested interests are quoting 7% falls its time to be worried ..... usually quoting the BEST CASE scenario (i.e. cloud cukoo statistics).

.... Just look to America for an idea of how its going to be here.

I agree.

Dolph · 21 May 2008 at 11:52

brid said:
When the vested interests are quoting 7% falls its time to be worried ..... usually quoting the BEST CASE scenario (i.e. cloud cukoo statistics).

.... Just look to America for an idea of how its going to be here.

Everyone knows the people who know what will really happen hang around on the internet...

Stinky · 21 May 2008 at 11:58

Dolph said:
Everyone knows the people who know what will really happen hang around on the internet...

exactly why i've stopped reading a lot of this thread.

Everyone see's What the media say as gospel

aardvark · 21 May 2008 at 11:59

Dolph said:
Everyone knows the people who know what will really happen hang around on the internet...

thats not true, you don't

Dolph · 21 May 2008 at 12:01

aardvark said:
thats not true, you don't

Says one of the many posters who cried wolf. Being perhaps a bit right once after being constantly wrong for the last x years doesn't make you insightful

aardvark · 21 May 2008 at 12:05

Dolph said:
Says one of the many posters who cried wolf. Being perhaps a bit right once after being constantly wrong for the last x years doesn't make you insightful

on the contrary, everything thats happening has been entirely predictable - credit crunch, NR, falling house prices, rising inflation - its all happened before - its the timing thats tricky. I never thought that the politicians would be able to keep all the balls in the air this long - all credit to gordon brown and our record debt!

clv101 · 21 May 2008 at 12:27

Stinky said:
still all predictions!

Quite right, no one has a time machine.

Just so I understand you right, are you still saying that you don't expect a house price crash?

Dolph said:
Says one of the many posters who cried wolf. Being perhaps a bit right once after being constantly wrong for the last x years doesn't make you insightful

How come you're not making a case any more these days? Your contributions seem to have descended into dubious ad hominids.

Stinky · 21 May 2008 at 12:33

clv101 said:
Quite right, no one has a time machine.

Just so I understand you right, are you still saying that you don't expect a house price crash?

How come you're not making a case any more these days? Your contributions seem to have descended into dubious ad hominids.

im not expecting it to be anywhere near as bad as a lot of people on here are making out

Muffin` · 21 May 2008 at 12:37

Stinky said:
im not expecting it to be anywhere near as bad as a lot of people on here are making out

Why? Do you think with growing unemployment, rising fuel, tax and food prices the market will be able to continue to grow or even sustain its self at its current level, even though it has already started to fall?

Stinky · 21 May 2008 at 12:40

Muffin` said:
Why? Do you think with growing unemployment, rising fuel, tax and food prices the market will be able to continue to grow or even sustain its self at its current level, even though it has already started to fall?

latest i have read is a fall of 40% is prodicted!

i do not see a 40% decline! and prices have not dropped much at the moment! well not around this area no!

Muffin` · 21 May 2008 at 12:44

Stinky said:
latest i have read is a fall of 40% is prodicted!

i do not see a 40% decline! and prices have not dropped much at the moment! well not around this area no!

Well, its happened before

Could come in the form of a decline or a crash really.

clv101 · 21 May 2008 at 12:47

Stinky said:
im not expecting it to be anywhere near as bad as a lot of people on here are making out

So what do you think? I'm having a hard time working it out sorry! Do you think house prices will fall in 2008? If so how much? Real or nominal?

Andrew_McP · 21 May 2008 at 12:49

Stinky said:
i do not see a 40% decline! and prices have not dropped much at the moment! well not around this area no!

Go on then, tell us how many properties your agency sold last month, and how does that compare to this time last year?

You are our canary in the coal mine, so sing for your seed. :-)

Andrew McP... old enough to have seen the last crash, and now seeing all the pieces fit into place for the next one. These things take years though, not days, and we've only just got started.

Stinky · 21 May 2008 at 12:52

Muffin` said:
Well, its happened before

Could come in the form of a decline or a crash really.

yes its happened before. are you saying you can see a fall of 40% in one year? at the moment?? CML predicts 7% fall this year! others saying 40% in 2008.

Yet CML also reported a 5% rise in april over march (in mortgage lending) but again a annual drop of 8%

its all up and down at the moment! im not convinced yet! sorry!