The Property Waller

The Property Waller Property News, Market Updates, Hints and Tips, plus a dash every now and again of random property-related trivia.

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Ok… I’m sure many of you have seen this before, but down the pub tonight nobody bar one other bloke had, so I thought I’...
07/09/2024

Ok… I’m sure many of you have seen this before, but down the pub tonight nobody bar one other bloke had, so I thought I’d share again just for fun.

So… what colour(s) is this dress, people?there are no wrong answers, it’s not a trick question - I promise

Go on, someone say The Property Waller
01/09/2024

Go on, someone say The Property Waller

31/08/2024

Its - and so here’s a roundup for you as I char the chicken.

I said ‘char’

01/08/2024

It looks like today’s decision will be resting on a knife edge, here are the reasons why

It is a fun day, if you’re a geek like me….Because today is the day that the meets to vote on what they do with the Ba...
01/08/2024

It is a fun day, if you’re a geek like me….

Because today is the day that the meets to vote on what they do with the Bank of England base rate!

Do they stick, or twist?

There are reasons we might expect to see a cut today… but there are reasons they might hold firm (and that’s why the vote is likely to be close… and personally I think it will be 5-4).

To give you a really basic rundown, the reasons for a cut or against one, are as follows:

FOR:

- inflation held at the BoE’s 2% target two months in a row
- wage growth has fallen from 8% last summer to 5.7% now
- unemployment is increasing, pulling wage growth down further
- the outlook for economic growth is soft, not just in the UK but also Europe and the US; a base rate cut will encourage consumer spending and improve the prospect of economic growth
- it will mean the UK beats the Federal Reserve to rate cuts…. It shouldn’t matter (but I bet it does! Especially as Europe did already cut)


AGAINST

- lack of any guidance (hints) from the Bank of England since the election
- core inflation is still high
- services inflation in particular remains stubbornly high (but in large part that may be a Taylor Swift-induced blip, and temporary)
- wage growth has fallen, but nevertheless, at 5.7%, is still high
- unemployment may be rising but, at 4.4%, is still relatively low, and signs are that firms that laid off workers (rather than letting them go) are rehiring them
- the Bank of England is proudly independent; members of the committee may worry that a cut straight after an election will be seen as political and will be mindful of preserving its independence from national politics (including the perception of independence)
- they will feel buoyed that mortgage lenders are already pricing in a cut, meaning they can opt to play it safe this time with the expectation being that even if they do, a cut is then almost certain in September, delivering a slower yet still tangible boost to economic growth, alongside low but noticeable cuts to mortgage rates from lenders, thus easing pressure on homeowners
- inflation is expected to increase from 2% later this year, a key driver in rate setting
- the economic recovery from the most recent recession (remember that? It was literally only last year) was stronger than expected, dampening the idea that consumers are unwilling and unable to spend on goods and services

Still… taking all the above into account, I am willing to stick my neck out… I’ve bet one client a pint on the outcome, and therefore why not come out with it?

I think it will be 5-4 in favour of….

… a 0.25% cut

🙈

28/07/2024

It’s Sunday 28:07/2024, and here’s a update over the … it’s !

🏡 ASKING PRICES FALL (but sales are up) 🏡In a sports-filled, politics-obsessed few weeks - and being summer to boot, whi...
28/07/2024

🏡 ASKING PRICES FALL (but sales are up) 🏡

In a sports-filled, politics-obsessed few weeks - and being summer to boot, which usually heralds a slowdown in the property market - it isn’t too surprising to see The UK’s leading propert portal Rightmove announce that asking prices on new listings dropped slightly this month, by 0.4% (although notably by 2% in the South-East).

Nevertheless, in encouraging signs that the market is waking up, new sales are up by 15% compared to the same period in 2023 - a period when we were facing the peak of mortgage rates, compared to now when no matter what the Bank of England does with their base rate on August 1st, mortgage lenders are taking the bull by the horns and starting to cut rates.

Halifax, the UK’s biggest lender, has reduced rates by up to 0.13%. Barclays has cut their rates by a whole 0.33%, and this week the Nationwide became the first lender to drop one of its five year fixed rate mortgages to below 4% for the first time since February this year - down to 3.99%, but there are already signs that other lenders are beginning to compete.

Whether the Bank of England cuts the base rate on Thursday or not, the expectation is there that it is coming, and even if the summer itself remains relatively subdued - as summers do - I expect a pretty active autumn market; not least, because Tim Bannister, Director of Property Science Innovation at Rightmove, forecasts the same…

“A first base rate cut for over four years, together with new political certainty, could set the scene for a positive autumn market, with improved affordability and a more confident outlook in the second half of the year,” he predicts.

That 2% drop in asking prices in the South East of England is likely to correct itself fairly quickly, and more in fact. I would go as far as to say that by the end of October we will be used to seeing headlines about a new ‘property boom’.

It won’t be a boom, actually - but it will be an increasingly positive 8 to 10 week period through September to mid November for property listings and sales, combined with nominal house price growth in the low digits, feeding a feeling of general positivity.

Cue a natural Christmas slowdown, but only to tee up what I personally think will look like a very positive first half of 2025 as a result, as sales momentum catches up and mortgage rates in the region of 3.25% to 3.75% start to look and sound normal again.

If you are thinking of selling your property, or if you have been trying but feeling like you’ve been hitting a brick wall, you may want to take a look at the post-summer period this year - it’s going to be decent.

Here’s a question: proportionately speaking, what do you think makes up the greater percentage of UK properties? Owned, ...
25/07/2024

Here’s a question: proportionately speaking, what do you think makes up the greater percentage of UK properties? Owned, or Rented?

And actually, just for fun, let’s play a game - split that further, into 1st, 2nd, 3rd and 4th places, deciding which takes a larger proportion of properties: those owned outright; those owned with a mortgage; those privately rented; and those which are ‘social rent’….?
Ok, have you written down your answers?

Well, as it goes, I actually already gave them to you in the right order.

Here is how UK property occupancy breaks down into percentages:

- Owned Outright = 36%
- Owned but paying a mortgage = 28%
- Privately Rented = 19%
- Social Rent = 17%

So did you get the order right?

It’s interesting.

We hear that home ownership is out of reach - yet almost two thirds of adults in the UK are in homes they own.

We know that the property market is affected by mortgage lending - yet only a little over one on four properties are mortgaged.

We hear that there is a mass exodus of landlords from the private rented sector - yet that accounts for less than one in five properties.

We hear we need to build more social housing - and yet, at just 17% of the market, that’s less than one in six… roll a dice (ok, a die), get a six, I challenge ya!

So seriously, what is all the fuss about? Why are you complaining?!

Ahhh… apologies… I forgot to give you some other stats:

The average age of a first time buyer in 2004 was 28 years old; in 2024 it is 35.

The average mortgage term for a first time buyer in 2024 was 25 years old; now, it is 32.

Your average 28 year old first time buyer in 2004 will own their home outright by the age of 53, in 2029… just five years to go guys, well done!! And many will have overpaid in the post-credit-crunch years, taking advantage of super low mortgage rates, and may own their home already… either that, or they blitzed out and overextended themselves, and now live on alphabetty-spaghetti on toast with no lights or heating on, in their turreted Cotswolds pad with swimming pool…

Anyway, that’s by the by, the point is that your average 35 year old first time buyer in 2024 will finish paying that mortgage off in 2056, aged 67.

Big difference.

Oh, and here’s another stat to add in…. Not everyone in the UK has a home.

309,000 people in the UK are homeless. One in every two hundred people.

And that, my friends, is why we have a housing crisis, that’s why need so many new homes built, and that’s why Labour needs to stand by its promise. No excuses now.



Yesterday, it was announced that UK inflation held steady at the Bank of England’s target of 2% for the second month in ...
18/07/2024

Yesterday, it was announced that UK inflation held steady at the Bank of England’s target of 2% for the second month in a row.

Good news right? Increases the likelihood of Bank of England base rate cuts in August..? Surely?

Well, oddly not.

Financial Markets, who had been upbeat about a further drop in inflation this month, revised their prediction for an August cut from being a 50/50 before the ONS data was released, reducing to just a 35% chance thereafter.

So what changed? What caused inflation to remain at 2%, when so many predictions had been to expect further drops to as low even as just 1.5% (although that prediction was madness).

Well, a major factor - and a curveball, really - was that the cost of a hotel room shot up by about 9% in June, counteracting the general drop in inflation that might otherwise have been.

And why?

The UK leg of Taylor Swift’s Eras tour.

Mad? Not really - and when the prevailing inflation of hotel room prices had been 1.7%, you can understand why it did make such a difference to the overall inflation figure this month.

A base rate cut in August isn’t impossible by any means; even at a 35% chance, that’s like rolling a dice and winning on the roll of a 5 or 6, right?

But nevertheless, if you’re a Swifty but you are also a mortgagee looking to fix a decent two year or five year rate, holding off until early august to capitalise on falling mortgage rates… well, sorry if you feel there’s a bit of bad blood.

Just going through the King’s Speech, working out what it all means, and came across this typo that is perhaps more like...
17/07/2024

Just going through the King’s Speech, working out what it all means, and came across this typo that is perhaps more like a Freudian slip, because actually that’s not a bad description at all…

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