With the US subprime crisis spreading to Europe, shockwaves in Northern Rock which would spread to other banks, UK economy growth not looking healthy, increasing trade deficits, sharply rising mortgage costs, falling corporate profits and job cuts especially in the City, and as market turmoils escalates, housing price which shows a first drop of 2.6% (from Rightmove last month), this are the signs of the beginning of a housing crash. PROPERTY SHARES ARE A SELL!

Taylor Wimpey is 86p now

oh dear.....2.5% drop in house prices this month.....thats average 5k of everyone house.

oil price booming.....food prices rocketing.......real inflation has been calcalated to be 14.5%, not gordon brown made up fantasy figure.

unemployment rising.....even the poles r starting to leave.

also, rampant violence under the the anger ridden people of uk with the soft approach taken by blair in past who couldnt even deal with his own children.

public finances r screwed too........gov must increase taxation and keep hoping oil goes up so that petrol is at least 1.50 quid or even 2 to raise revenue. also northern rock to pay and extra 50 billion to banks plus iraq to fund......oh and to double its amount given to europe for next SIX YEARS! LOL

THE COUNTRY IS SCREWED

Things are not looking that rosy Scot but stagflation is a global phenomenon and there are plenty of far worse places to live than the UK. The UK presss seem to make out it's only happening here. May be we should be looking for a new planet!

http://www.telegraph.co.uk/money/main.jhtml?view=DETAILS&grid=A1YourView&xml=/money/2008/05/26/ccom126.xml

Taylor Wimpey is the biggest casualty - 75p now.

yes, things maybe worse in places like korea, iraq, zimbaBwe etc but this is uk! we used to rule quarter of the world....we used to be caring, well educated, well mannered people, well dressed too........i cant say any of these things anymore. people in this country r apathetic and dont want to work but expect to be wealthy and have 2 holidays a year, modern gadgetry, designer clothes etc, lol.

just read that 350 aussie bankers left uk as they r fed up looking at impoverished people in uk......lol, hilarious.....aye, you dont see poverty in oz like you do in britain. thats from a country thats REDUCED taxation by 15% in last decade, not increasing it with stealth taxes like capitalist labour

Barratt Developments (BDEV.L: Quote, Profile, Research), Britain's second largest house builder by volume, said on Wednesday reservations in 2008 were down a third year-on-year as buyers struggle to get mortgages in the global credit crunch.

"Since the end of March, market conditions have deteriorated significantly as a result of an unprecedented reduction in mortgage availability and tightening lending criteria, combined with a decline in consumer confidence," Barratt said.

The comment chimes with recent statements from rivals and the timing ties in with a report early in April from Halifax, the country's biggest mortgage lender, that house prices fell 2.5 percent in March, as competition in the mortgage market all but disappeared and availability dried up.

house prices still rising in scotland!!!

My niece lives in Scotland.

She says the 'experts' there are saying you are about to join us in the plunge

it depends where u live really......aberdeen is awash with money and imagine double digit increases again.....on top of 35% increases in last 2 years each....houses have doubled in price there in 2.5 years almost.

growth of 4% right now this year overall in scotland from what was on in news.

its just credit crunch.....and hornby the devious git says it will last at least 18 months more......so dont expect much houses being bought in england, if any are bought these days......capitalism between goverments and banks etc are falling apart and we r to endure it for well over 2 if not up to 4 years by some analysts.......maybe marx, stalin etc was right

Being the contrarion as always...............;-)

I am hearing high level banking figures talking about a recovery in the money markets as soon as Q4 this year.
These guys are also talking of house prices falling by as little as 2%. The most vocal of these has put his money where his mouth is and relaxed criteria on his BTL range of mortgages. This is the first relaxation of criteria in a year and goes against the tide.
Other companies are also now swimming against the tide in other ways.
Abbey and Skipton, to name 2, have re-introduced exclusive products for intermediary sales, and very good ones they are too, better in some ways than the direct offerings. This flies against the Nationwides and HBOS who have kept the very best exclusives for branch use only.
Perhaps not the green shoots of recovery, but the odd seedling starting to sprout.

The announcement I have just posted on Lloy BB does seem to indicate that there is plenty of money available if the deal is right. Lloy would seem to be going cherry picking which seems to indicate that there are good opportunities around for the shrewd.

I have been looking at the Builders from a contrarian viewpoint, a sector in which I have no share holdings at present. Although the background is not encouraging it may be a worthwhile exercise to consider the Companies that are better placed once a bottom has been found. Although I have more homework to do, my initial view is that the prospects for Taylor Wimpey and Barratts look awful so I have cast them aside. The better ones may be Bovis and Bellway and perhaps the more diversified Galliford Try, the directors of which have been buying shares around the 50p level although the sp has weakened since. I agree that we probably have more bad news to come but I can not help thinking that the market is beginning to discount alot of the prospective bad news in repect of some of the stocks. However, still watching at present.

Probably very wise, Gus.
Inevitably, the new build sector will be one of the last to benefit from an end of the crisis. There will be many indicators before then.
You are right about Lloyds cherry picking. They all are. There are odd exceptions to be found, but they are mainly mutuals. Most mutuals seem to have almost identical criteria, and LTV levels as before the crunch, though some have redrawn their geographic criteria.
The point I was making was that the onset of the credit crunch saw lenders scrambling to ensure their offerings were not market leading. They did not want to be exposed. Now we are just starting to see a reverse as some lenders are trying to top the comparison charts (though with large fees). This is a sign that they have money to lend out and are willing to buy business, and therefore a sign that we may have seen the worst.

Following on from yesterday, today sees one small lender increasing its available LTV's from 75% to 90%, and Leeds increasing their BTL LTV's to 80%.
This is a good sign of returning confidence within the lending institutions, but there is a long way to go yet.

I would't get too carried away, just wait for christmas, and then a long hard winter.
I believe were only at the very start of a downturn, that could potentailly be rather nasty!
imo

The jury is out, Neil, but I think it has bottomed in the financial markets. It may bump along for a while and it will be some time before the real economy feels the full effect, but I think the balance of "news" from banks etc. will now be neutral and will turn more positive through late 2008.
Just like you, imo.
Alan

And within the last 30 minutes a very odd announcement.
Cannot disclose the lender, but they have announced they are only making their high LTV product available as a fixed, not at their SVR.
The public reason for this, when announced, will be to mitigate the borrowers risk from potentially increased payments. No lender is that altruistic. I beleive the real reason is more likely to be profitablity. I think they are expecting their LTV to drop in the coming months and anyone on a fixed rate will be paying much more than otherwise and face large penalties to get out of the fix.
A kind of fleece 'em while you can scenario. Normally they would pull their fixes and replace them with lower fixes, but with them being one of the few available over 90%, they do not need to work hard to attract borrowers.

Alan - what sort of term is it fixed for? Seems to me that major cause of banks' troubles is lending long and borrowing short, so from their perspective the deal makes sense if they have sourced the funds. If only for a few years, however, surely the borrower is back to the mercy of rates when the deal expires?

Just 3 years, Partridge.
I still read it as profiteering from a restricted supply by ensuring as supply eases and rates come down they are enjoying large margins.