Best of the Week
Most Popular
1. Crude Oil and Water: How Climate Change is Threatening our Two Most Precious Commodities - Richard_Mills
2.The Potential $54 Trillion Cost Of The Fed's Planned Interest Rate Increases - Dan_Amerman
3.Best Cash ISA Savings for Rising UK Interest Rates and High Inflation - March 2018 - Nadeem_Walayat
4.Fed Interest Hikes, US Dollar, and Gold - Zeal_LLC
5.What Happens Next after February’s Stock Market Selloff - Troy_Bombardia
6.The 'Beast from the East' UK Extreme Snow Weather - Sheffield Day 2 - N_Walayat
7.Currencies Will Be ‘Flushed Down the Toilet’ Triggering a ‘Mad Rush into Gold’ - MoneyMetals
8.Significant Decline In Stocks On The Cards! -Enda_Glynn
9.Land Rover Discovery Sport Extreme Driving "Beast from the East" Snow Weather Test - N_Walayat
10.SILVER Large Specualtors Net Short Position 15 Year Anniversary - Clive_Maund
Last 7 days
Can Bitcoin Price Rally Continue After Paypal Fake FUD Attack? - 19th Mar 18
2018 Reversal Dates for Gold, Silver and Gold Stocks - 19th Mar 18
This Tech Breakthrough Could Save The Electric Car Market - 19th Mar 18
Stocks Set to Open Lower, Should You Buy? - 19th Mar 18
The Wealth Machine That Rising Interest Rates Create Conflict With The National Debt - 19th Mar 18
Affiliate Marketing Tips and Network Recommendations - 19th Mar 18
Do Stocks Bull Market Tops Need Breadth Divergences? - 19th Mar 18
Doritos Instant £500 Win! Why Super Market Shelves are Empty - 19th Mar 18
Bonds, Inflation & the Market Amigos - 19th Mar 18
US Housing Real Estate Market and Banking Pressures Are Building - 19th Mar 18
Stock Market Bulls Last Stand? - 18th Mar 18
Putin Flip-Flops Like A Drunken Whore On Bitcoin Cryptocurrency Legalization - 18th Mar 18
How to Legally Manipulate Interest Rates - 18th Mar 18
Return of Stock Market Volatility Amidst Political Chaos and Uncertain Economy - 18th Mar 18
Bitcoin Price Trend Forecast, Paypal FUD Fake Cryptocurrency Warning - 17th Mar 18
Strong Earnings Growth is Bullish for Stocks - 17th Mar 18
The War on the Post Office - 17th Mar 18
GDX Gold Mining Stocks Fundamentals - 16th Mar 18
Nationalism, Not the Russians, got Trump Elected - 16th Mar 18
Has Bitcoin Bought It? - 16th Mar 18
Crude Oil Price – Who Wants the Triangle? - 16th Mar 18
PayPal Cease Trading Crypto Currency Bitcoin Warning Email Sophisticated Fake Scam? - 16th Mar 18
EUR/USD – Something Old, Something New and… Something Blue - 16th Mar 18
DasCoin: A 5-Minute Guide to How It Works - 15th Mar 18
Stock Market Downward Pressure Mounting - 15th Mar 18
The Stock Market Trend is Your Friend ’til the Very End - 15th Mar 18
6 Easy Ways to Get What Women Want, for Less! - 15th Mar 18
This Isn’t Your Grandfather’s (1960s) Inflation Scare - 15th Mar 18
Eye Opening Stock Market Index, Volatility, Charts and Predictions - 15th Mar 18
Gold Cup At Cheltenham – Gold Is For Winners, Not For Gamblers - 15th Mar 18
Upcoming Turnaround in Gold - 14th Mar 18
Will the Stock Market Make Another Correction this Year? - 14th Mar 18
4 Ways To Writing An Interesting Education Research Paper - 14th Mar 18
China Toward Sustainable Economic Growth - 14th Mar 18
Stock Market Direction Is No Longer Important - 14th Mar 18
Trade Tariffs Defeat Globalists and Return Prosperity - 14th Mar 18
Stock Market Crash is Underway and Cannot be Stopped! - 14th Mar 18
Are Energy Sector Stocks Bottoming? - 14th Mar 18
Nasdaq Stocks Soars to New Record High After Strong Job Reports - 14th Mar 18
Bitcoin BTCUSD Elliott Wave View Calling for Rally toward $15,000 - 13th Mar 18
Hungary’s Gold Repatriation Adds To Growing Protest Against US Dollar Hegemony - 13th Mar 18
Record Low Volatility in Precious Metals and What it Means - 13th Mar 18
Tips for Writing and Assembling the Classification Essay - 13th Mar 18
Gerald Celente "If Rates go up too High, the Economy goes Down, End of Story" - 13th Mar 18
Stock Market Selloff Showed Gold Can Reduce Portfolio Risk  - 13th Mar 18
Silver Does it Again! Severe Consequences - 12th Mar 18
Has the Stock Market Rally Run Out of Steam? - 12th Mar 18
S&P 500 at 2,800 Again, Stock Market Breakout or Fakeout? - 12th Mar 18
The No.1 Energy Stock To Buy Right Now - 12th Mar 18
What Happens Next When Stock Market Investor Sentiment is Neutral - 12th Mar 18
Economic Pressures To Driving Gold and Silver Prices Higher Long-Term - 12th Mar 18
Labour Sheffield City Councils Secret Plan to Fell 50% of Street Trees Exposed! - 12th Mar 18

Market Oracle FREE Newsletter

Urgent Stock Market Message

UK Housing Market to be Hit by the Big HIPs Freeze During December

Housing-Market / UK Housing Nov 23, 2007 - 12:16 AM GMT

By: Nadeem_Walayat

Housing-Market The British Government's decision to expand the requirement for ALL UK Home Sellers to provide a Home Information Pack as of 14th December 07, will likely result in a big freeze on transactions hitting the UK housing market from 14th December 07. As fewer properties are put onto the market and thereby less transactions take place. Whilst this could be construed as being short-term supportive of house prices, it will hit the housing sector hard, which includes mortgage lenders and estate agents that could see as much as a 25% drop in business over a short space of time, and therefore the expectations are for further shocks in the housing and financial sector, this time focused on estate agencies.

The HIPS had been originally planned to come in force during June 2007, but have been delayed and staggered in the rollout due to industry concerns and lack of qualified energy assessors.

However after the initial slump in transactions, this extra cost of approx £500, associated with selling properties will lead to a further deflationary effect on the UK housing market as Home Buyers will still have to conduct their own surveys before mortgages would be approved. Especially as HIPs do not contain a compulsory home condition report.

First Time Buyers are expected to be hit the hardest from the HIPS freeze as the £500 cost is a greater percentage of a typical first time home buyer priced house in the region of £100,000 to £150,000, and therefore the supply of these properties are expected to be reduced the most. This will ripple out and be felt all along the housing chain and thus contributing to a Big FREEZE in the UK Housing Market which will contribute to a further loss of confidence.

The Home Information Packs (HIPs) were ironically introduced to increase the speed transactions in the Housing market as each potential buyer would no longer need to conduct expensive repetitive searches on the same property before discovering potential problems that could lead to the sale falling through.

The HIPs packs include the following compulsory documents:

  • Home Information Pack Index
  • Energy Performance Certificate
  • Sale statement
  • Standard searches
  • Evidence of title
  • Additional information for leasehold and common hold sales, where appropriate.

Additional optional documents may be included such as flood risk search and home condition survey report. HIps sample

The current consensus forecast is now for a stagnating UK housing market during 2008. The expectation is that as house price declines occur, this consensus will eventually change to recognise a declining housing market in line with the Market Oracle forecast of at targeted 7% drop during 2008 and a 15% drop over 2 years.

The next date for Home Owners / Sellers and Buyers to watch is 1st of April 08, when the capital gains tax change could result in an avalanche of buy to let selling. This tax change is such a bad move for the UK housing market that I would not be surprised if the Chancellor did a u-turn during the March 08 budget. However, despite a possible u-turn, the buy to let sector is primed for a crash as the buy to let lenders evaporate from the market place in the face of the credit crunch squeeze on intra-bank lending, which is playing itself out with the likes of Northern Rock and Paragon this week, with many other lenders and players in the coming months to come forth for their own mini-share price crashes and bringing many to and over the edge of liquidation. Two key banks at risk are Alliance & Leicester and Bradford & Bingley, with a plethora of other non bank buy to let and subprime lenders about to burst onto the news scene over the coming months.

UK Housing Market Forecast for 2008-09 - As of 22nd August 2007
UK House Prices to fall by 15% over two years, falling prices to be accompanied by cuts in UK interest rates. (22nd Aug 07),


By Nadeem Walayat
Copyright (c) 2005-07 (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 20 years experience of analysing and trading the financial markets and is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication. We present in-depth analysis from over 100 experienced analysts on a range of views of the probable direction of the financial markets. Thus enabling our readers to arrive at an informed opinion on future market direction.

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2018 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules